PEP CLOTHING

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Supplying garments to leading South African retailers for the last 40 years

P e pC l o t h i n g

The Fabric of

SouthAfrica Pep Clothing provides insight into the current market conditions for the garment manufacturing industry in South Africa and the company’s biggest achievements as we approach the end of 2014 Writer Emily Jarvis Project Manager Tom Cullum

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That makes you a unique contender in the clothing market?

Apparel manufacturer Pep Clothing (a division of Pepkor Retail Limited) has been supplying garments to leading southern African retailers for the past 40 years. Our manufacturing operations are situated 10 minutes’ drive from Cape Town International Airport and 25 minutes from the shipping harbour in Cape Town, South Africa. As a low-cost, high-volume mass manufacturer, Pep Clothing is unique within the southern African clothing industry.

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We have always invested heavily in training and developing of our team members through internal and external interventions. We have a culture of personal growth and mutual respect. Consequently, this has enabled us to achieve excellence in our processes which ensures that we continuously deliver high quality products with consistent quality performance year after year. Product consistency is extremely important in the school clothing market, as consistency in product quality is essential for repeat orders. We stand out from the crowd as a result of this commitment to our customers and our team culture.

Talk me through your main achievements for this year

Pep Clothing’s four factory divisions manufacture basic school clothing including trousers, shirts, dresses and a range of basic knitted underwear. The company is currently the largest clothing manufacturer under one roof in Southern Africa, employing over 1,600 people and delivering more than 7 million garments annually to our retail customers.

Our main objective was to stabilise performance during our extensive factory renovations, as well as reducing waste in the process. We are proud to report that we have to date managed to recover all production losses that were a result of the renovations.

Additionally, we have improved our productivity with one percentage point on the British Standards International, as well as reduced overall downtime.

We have also developed new fabric types with two of our major fabric suppliers, which will greatly enhance our product offering.

As it stands, we are now 75% complete in renovating the entire factory as part of our Continuous Improvement Projects. We have redesigned the factory layout in order to save 4400m2 of space. This entails moving each of the four factories to a temporary area while the current space is refurbished. Three of the four factories are now complete and in operation. Once these renovations are complete in 2015, we will implement an additional shift in order to increase production capacity; further enabling

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us to create economies of scale and in doing so deliver more value to our team members and shareholders.

I believe that our Moreover, the new areas are laid out more effectively in terms of value leadership style streams as well as health and safety nurtures a culture of standards. We are also replacing all growth and our light fittings with new T5 type appreciation. This in lights which are more environmentally friendly and use less electricity. turn creates loyal staff Furthermore, we are now in our team members who third year of upgrading our machines give their very best each and equipment as part of the Production Incentive programme hour of every day through the Department of Trade and Industry. We acquired a new automatic cutting machine that will improve productivity, reduce waste and ensure Tariff Code structure is a constraint accurate cutting quality. insofar that one code covers several different fabrics, some of which are manufactured locally. This requires a What issues would complicated mechanism to provide you say have been affecting the clothing relief to companies who desperately need it, and at the same time protect industry as a whole? the existing textiles factories that still For many companies including Pep exist in South Africa. To date there Clothing - who use fabrics that are has not yet been a solution to this not manufactured locally - the high trade barrier, but we are hopeful this import duties on fabrics are a barrier will change. to securing competitiveness. The HS

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In order for our Industry to compete nationally and internationally, we not only need lower input costs such as raw materials and utility costs, but we also need to resolve the shortage of skilled workers and capable technical management. The solution lies in managing these different expectations responsibly.

Where do you source your raw materials and why?

There are areas in the clothing manufacturing industry that show growth, especially manufacturers that manage to deliver products and services to their customers that are of superior quality than the relatively cheaper imports. Local retailers are also starting to see the potential benefit in shorter lead-times from local manufacturers when compared with imported products. This interest in purchasing products locally is due to two main factors: the weak rand making imports more expensive relative to the previous year(s), and the shorter lead times due to geographic location. The challenge still remains though; the high cost of raw materials, especially those that attract import duties even though those fabrics are not manufactured locally.

More than 90% of our fabric is imported as they are not manufactured locally, which places our supply chain as a critically important part of our business.

We manage our operation on a just in time basis and have a dedicated supply chain team on staff who ensure our inbound, internal and outbound supply chain activities are optimised.

From your perspective, why has Pep Clothing continued to grow from strength to strength?

I believe that our leadership style nurtures a culture of growth and appreciation. This in turn creates loyal staff team members who give their very best each hour of every day. As a result of our tenacity and strong position in the market, Pep Clothing received the award for Best Company in Reducing Waste in 2013-2014 from the Cape Clothing and Textile Cluster, as well as several other supplier awards from our customers. And of course, we work within the communities in which we operate. As one of our core markets is children’s school clothing, we actively support the Kidz2Kidz Foundation in Managing the Donations2Distibutions network as well as other monthly volunteer work.

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E n q u iries Tel (UK): +44 (0) 1603 559 151 Tel (SA): +27 (0) 21 527 0053 ben.weaver@outlookpublishing.com

S U B S C R I P T I ON S

PEP Clothing PO Box 6027 Parrow East 7501 Cape Town

Tel (UK): +44 (0) 1603 559 152 emily.jarvis@outlookpublishing.com

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Tel: +27 21 937 2300 Fax: +27 21 937 2739