Gildan bets on Bangladesh hub to expand apparel output in Asia

Bloomberg

Apparel giant Gildan Activewear Inc is building a new manufacturing hub in Bangladesh, aiming to supply both Europe and a Chinese market that it described as “on fire.”
The Montreal-based manufacturer of T-shirts and innerwear spent $45 million to buy land in the South Asian country, where it’s been since 2010 and currently employs 3,500 people.
Gildan expects the complex, which will comprise “two large textile facilities and related sewing operations,” to eventually support $500 million in annual sales.
Gildan says Bangladesh offers low costs, access to more than 4 million garment workers, and duty-free entry into several Asia markets.
The company, which competes with Hanesbrands Inc and Berkshire Hathaway Inc’s Fruit of the Loom, has production capacity in Central America and the Caribbean, but that’s not well suited to serving Asia.
‘‘We built a global, low-cost manufacturing hub in Central America that really is great for this market and the fact is that we just can’t use that to support China, Japan,” Gildan CEO Glenn Chamandy told analysts. The new hub “opens up a lot of doors for us.”
Most of Gildan’s revenue comes from selling blank T-shirts and other items that wholesalers can customise, though it’s been increasingly selling branded apparel directly to retailers. It also bought the American Apparel brand in a 2017 bankruptcy auction.