Global Apparels, a Malaysian-owned readymade garment factory in Phnom Penh, Cambodia, plans to shut down.Reasons include fierce regional competition, lack of orders and a year of losses.
The factory will close down completely by October 2016. It says it will not be able to pay its workers if it continues to operate beyond that and shutting down is the only option.
Productivity issues have been the foremost concern for a lot of readymade garment factories in Cambodia, as strong competitor countries like Vietnam and Bangladesh are showcasing higher productivity at lower costs. In addition labor unrest crops up now and then. It’s possible that many such companies will find the going unviable and wind up. This is a development that needs urgent attention. Efficiency is often measured in terms of how fast output can be scaled up. In the race to hike output many companies find themselves outmanoeuvred.
Global Apparels was incorporated in October 2003, built on a land of 80,000 sq. ft. The company, which manufactures knits and woven apparels, has a monthly production capacity of six lakh pieces. It currently employs approximately 2,000 employees and primarily exports to the United States, Europe, and Japan.