Global Business Guide Indonesia

Export
Pan Brothers Tbk
Mrs Anne P. Sutanto

Mrs Anne P. Sutanto, Vice President Director

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Pan Brothers Tbk was established in August 1980 and has since expanded under new management to become a leading garment producer in Indonesia. Please present the background of the company, milestones to date and the current strategies being applied to position the company as a leading garment manufacturer in Asia.

Mrs Anne P. Sutanto

The company was listed on the Indonesia Stock Exchange in August 1990 and was then taken over by the current management in 1997. In 2001, the decision was taken to refocus the company to garment manufacture. Under new management, the company grew significantly from annual sales of less than 50 billion RP in 1996 to 2,170 billion RP in 2011 and profits of 72,121 billion RP. Market capitalisation based on the share price was 1,531 billion RP at the end of 2011.

For the future strategy, this year in 2012 will see Pan Brothers expand in both the upstream and downstream channels. In the upstream, we will build our capacity in textile fabric production as a majority shareholder in a new joint venture. Moving further upstream into spinning and fibre production is also an area currently under consideration and we are in negotiations to establish a new venture in this field. Within downstream garment manufacturing, we will move into producing new products such as uniforms.

Establishing our own apparel collection for the retail market is also an area that we are going to explore in the near future. Using our network of sourcing and buying offices as well as our partnership with PT Hollit International, we will consolidate our expertise in the garment business to move into the apparel retail business. We expect to enter into retail in the next 2-3 years beginning with the main cities in Indonesia. Within the next 4-5 years we aim to expand into the ASEAN and other countries in Asia under our own brand collection.

The expansion of our manufacturing facilities in Boyolali, Central Java was completed at the end of 2011 and is now fully operational. The new facilities have state of the art equipment and provide extended capacity for embroidery, printing and dyeing services for our customer base.

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How is the company positioned for working with international companies in the form of joint ventures for your future expansion plans?

Mrs Anne P. Sutanto

We currently engage with international partners for CMT (cut, make and trim) in Bangladesh, Vietnam, Cambodia and Myanmar. We are always open to new opportunities for joint ventures in garment manufacturing for companies coming into Indonesia as well as in other countries in Asia.

gbg

Pan Brothers is already present in international markets and supplying to leading brands in North America and Europe as well as Asia. Which markets will the company be targeting for exports in the future?

Mrs Anne P. Sutanto

Our export markets continue to focus on our existing markets of North America, Europe, Australia, China and Japan. Particularly for Japan, we have seen order growth triple from 2011 to 2012 especially from our client Uniqlo.

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The global textile and garment market is becoming increasingly competitive. For Indonesia, the introduction of the ASEAN - China Free Trade Agreement in January 2010 has heightened this competitiveness. In such a context, what differentiates Pan Brothers as a garment producer from its competitors in Indonesia and the region?

Mrs Anne P. Sutanto

Pan Brothers prides itself on being a completely integrated garment producer. Our capabilities span almost every kind of garment type so we can meet any customer requirements and specifications. We are also unique in being supported by our network of buyers, sourcing agents, product development specialists and vendors in Indonesia and throughout Asia. This means we are always ahead with the latest fabric ranges, fashion trends and new technology which has secured Pan Brothers as the number one garment supplier for many household brands worldwide.

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In 2011, Pan Brothers Tbk acquired a 51% stake in buying agent Hollit International. What was the strategy behind this partnership and what advantages will it bring to the company and its customers?

Mrs Anne P. Sutanto

We believe that the future of the garment industry lies in the ability to develop as well as produce products for the international market. Hollit International’s strengths in product development and its concentration on value added fashion products have made it unique in the industry. The merger with Pan Brothers will therefore bring us closer to achieving our vision of offering a vertically integrated service that combines knowledge of garment manufacturing and product development.

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What should potential clients and partners remember about Pan Brothers Tbk?

Mrs Anne P. Sutanto

Pan Brothers offers the full range of apparel products and guarantees the highest levels of quality as well as on time delivery. Our extensive client list which is made up of leading international luxury brands illustrates our achievements in customer satisfaction and consistent production quality.

Potential clients should remember Pan Brothers as among the best garment manufacturers in Indonesia and worldwide that offers a wholly integrated service and is positioned for long term, sustainable growth.