Clothing maker transfers production bulk to Cebu

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Friday, February 14, 2014


HOMEGROWN clothing brand Loalde announced last Wednesday that they have transferred the bulk of their production to Cebu from Hong Kong and China to improve retail production operations.

“We have been shifting the operations over the last 10 years from 30 percent local production to 70 percent. We have seen nothing but advantages with this shift of ratio,” said Loalde Group president Chris P. Aldeguer in a media briefing.

Previously, Loalde's Hong Kong and China production was at 70 percent. Cebu's production was only 30 percent.

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For Aldeguer, going local means faster turnover, less shipping costs, and simpler and higher quality assurance. It also means providing more employment within the local community and strengthening of brand heritage.

Loalde is a homegrown brand that has been in the retail industry for 37 years.

“The shift to local production will allow us to deliver new designs, increase frequency of delivery twice per week, and produce wider assortment,” he said.

Customers

With the shift, Aldeguer said, the firm can now deliver 1,500 styles per year or 150,000 pieces, unlike when production was based in Hong Kong and China, where they could only deliver 750 styles a year.

The higher local production would also enable the company to quickly respond to the needs of customers, he said.

Loalde, in the past, posted high sales growth--between 15 and 18 percent in 2010--but the next three succeeding years, sales growth has been stagnant due to competition and failure to deliver customer needs.

According to Aldeguer, instead of the usual six-month cycle of manufacturing turnover, local production will enable them to trim it down significantly to a one-month cycle.

This means that the in-demand designs will get to the customers right away.

Aldeguer noted that people nowadays are more fashion-conscious compared with the past years, so the ability to respond to fast-changing trends remains a challenge to clothing companies.

Market

But with the local production in place, he said the ability to determine if a certain clothing style sells, will be made easier.

“We'd like to focus more on the reaction of the market rather than the forecast so we would know which is fast-moving and which is not,” said Aldeguer, adding that the result would be more frequent visits of customers to check on new items.

Loalde has a total of 14 stores nationwide. It has two branches each in Cebu, Manila, Cagayan de Oro, Bacolod and Iloilo, while Davao has three outlets.

Amid stiff market competition with the entry of foreign brands as well cheaper apparel items from Thailand and Korea, Aldeguer believes Loalde has remained competitive.

“Exclusivity, for one, is our edge in the market. Our quantities per design is controlled. Second, is the affordability of our products,” he said.

Like other homegrown retailers, Loalde is now strengthening its foothold in the local market in preparation for the Association of Southeast Asian Nations (Asean) economic integration by next year. On top of moving the production here, Aldeguer said they are working on further improving their designs to stay competitive.

“Competition is stiffer but we still have a good market share. We have a good local brand that can compete well with the foreign brands,” he said.

The company now has two satellite production facilities here employing Cebuano designers. About 60 personnel are involved in the production, which Aldeguer plans to increase by 80 within the year.

Published in the Sun.Star Cebu newspaper on February 14, 2014.

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