Located in Ho Chi Minh, Vietnam, leading sportswear and knitwear manufacturer, ThanhCong Textile Garment Investment Trading JSC, is a world-renowned textile manufacturer offering afully integrated vertical production system ofspinning, weaving, knitting and dyeing garment production.
Since its inception in 1979, the company hasachieved steady growth, and now boasts anannual turnover of over $130,000,000. Customersinclude: CSW, Adidas, New Balance, Eddie Bauer,SanMar, Kohl’s and JCP, and it is listed as one ofVietnam’s Top 500 largest enterprises. ThanhCong has additionally won a variety of awards,such as: Eddie Bauer’s Product Quality and On-Time Delivery Award; JC Penney’s OperationalExcellence Award and a Gold Brand Certificate Award from Ho Chi Minh City.
Manually created cost forecasts based onhistorical data- were inaccurate and lacked fullteam visibility, which meant gaps incommunication between sales, planning andproduction teams, resulting in reducedefficiencies, unnecessary levels of waste and lostorders.Prior to implementing Coats Digital’s SaaS-basedcost optimisation solution, GSDCost, Thanh Cong,based its cost and capacity forecasts oninaccurate historical data stored on a variety of Excel spread sheets which were notoriously difficult to update in real time across all costing,capacity planning and manufacturing teams. As aresult of inaccurate standard minute values(SMVs) regarding CM (Cost to Make) production times, and poor costing and planning visibility,Thanh Cong suffered low efficiency rates, high defect rates and late deliveries, which often resultedin additional air shipment costs and an unnecessaryamount of material and people-hour wastage.
With rising CM costs in both labour and rawmaterials and a high variation in productionquality, due to time studies based purely onhistorical experiences, Thanh Cong needed a standardised solution that would accurately record SMVs through effective, standard motion digitised codes so it could optimise its costing processes, significantly enhance global manufacturing efficiencies and ultimately ensure it remainedprofitable in a highly volatile industry environment.
Following the implementation of GSDCost, ThanhCong was able to establish international standardtime benchmarks based on standard motion codesand predetermined times. This enabled the sales,costing, planning and manufacturing teams tocommunicate efficiently using the same language,based on a scientific method for correctly analysing manufacturing costs.As a result, business units could confidently andfairly negotiate product prices with customers, anda more succinct single view of overall CM costsenabled Thanh Cong to realise a production efficiency increase of 13.82%.In a nutshell, because capacity planning andmaterial requirements were based on realforecasts, Thanh Cong not only benefited from reduced material wastage and overtime staffcosts, but also avoided having to pay extra highshipping and air-freight charges, as orders weresignificantly less likely to be delayed. Thanh Cong reports that an initial analysis of 22,000 pieces resulted in an equivalent saving of $12,000 as aresult of higher efficiency cost planning, and theabsence of emergency costs, previously requiredto deliver orders on time.
An open and transparent production capacity platform has also enabled Thanh Congmanagement to set achievable productivity goalsbased on a fair standard of working hours. Theintroduction of achievable performance incentiveshas consequently greatly improved staff moraleand motivation, as goal setting targets are nowbased on realisable targets.Coats Digital’s GSDCost method analysis andpre-determined times solution is widely acknowledged as the de-facto international standard across the sewn products industry.The solution supports a more collaborative, transparent and sustainable supply chain, in whichbrands and manufacturers establish and optimise‘ International Standard Time Benchmarks’ usingstandard motion codes and predetermined times.This use of a common language and standards supports accurate cost prediction, fact-based negotiation, and a more efficient garment manufacturing process, while concurrentlydelivering on CSR commitments.Coats Digital’s enhanced feature of a globalisedFair Wage Tool combines the internationalstandard time for any given style, with detailed factory efficiencies, contracted hours and the fairliving wage for the country (data provided by theFair Wage Network).This added tool enables brands and manufacturers to quickly agree the fair living wage allowance for any given garment, in any factory in the world.
"GSDCost is the only globally recognisedinternational method-time-cost standard to successfully achieve cost optimisation andsustainable improvements to productivity. Wecertainly have not been disappointed. CoatsDigital’s latest SaaS version of GSDCost has enabled us to not only increase our overallefficiencies by a staggering 14%, but is set tovery positively impact our bottom line, bysaving us the equivalent of $12,000 for22,000 pieces following the initial analysis." Smart Factory Team LeaderThanh Cong.
"We are delighted that Thanh Cong has realised such fantastic efficiency results andsignificantly increased its profitability as aresult of implementing GSDCost. ThanhCong’s planning and sales teams were quickat learning how to get the most out of theGSDCost solution and its waste reduction achievements and increased transparency around labour costs, will greatly support thecompany and its brand partners’ social responsibility goals to meet increasing consumer demands for a more transparent,sustainable and ethically responsible apparelsupply chain."
