(Filed Under wholesale Basics News). Hanesbrand, Inc. has entered into an agreement to sell the majority of its yarn manufacturing operations to Gasonia, NC-based yarn manufacturer Parkdale as part of its plan to stop making its own yarn.
The company expects the sale to close during the fourth quarter of 2009, which will result in Parkdale taking over operations of Hanesbrands' Rabun Gap, GA, Mountain City, Tenn., and Galax, VA yarn production plants, which have a combined 780 employees. The company will close its remaining Sanford, NC plant, resulting in job loss for its approximately 150 employees, and by the end of the year will also close its cotton warehouse in Advance, NC, and yarn warehouse in Clemmons, NC, which will result in the job loss of its combined 25 employees. The company reported that it will source any remaining yarn needs from large-scale yarn suppliers.
According to Hanesbrand, by outsourcing yarn production it will “create a competitive long-term supply of Western Hemisphere yarn at no material charge” and expects to generate $100 million of balance sheet benefits in the six months following the sale due to working capital improvement, reduced raw material requirements, reduced inventory and sale proceeds.
“We are focused on optimizing the investments we have made in our supply chain that give us a competitive advantage,” said chairman and chief executive officer Richard A. Noll. “Producing our own yarn, when more than adequate large-scale supplies exist, serves no strategic purpose. Outsourcing yarn is a logical evolutionary step to drive value and improve the use of our assets.”
“We are leveraging our assets in areas where we can differentiate ourselves and use our scale and expertise for better returns,” Gerald Evans, Hanesbrands’ president of international business and global supply chain, commented. “We are keenly focused on optimizing the working capital needs of our supply chain through several initiatives, such as supplier-managed inventory for raw materials, sourced goods ownership relationships and other efforts.”
Hanesbrands Inc. is a major manufacturer, designers and marketer of innerwear, hosiery, activewear and outerwear under the Hanes, Champion, Playtex, Bali, Just My Size, Barely There and Wonderbra brands. The company employs a staff of approximately 45,000 across more than 25 countries. For further information, call Brian Lanz: (336) 519-7130.
Disclaimer: The views expressed in comments published on bodymagazine.us are those of the comment writers alone. They do not represent the views or opinions of Bodymagazine or its staff.
NOTE: Your Email will not be displayed.