Uniqlo's parent company: Factories in Vietnam are not as good as those in China

Responding to Nikkei, Fast Retailing CEO Tadashi Yanai said the company will not follow the trend of shifting away from China.

Fast Retailing CEO Tadashi Yanai - Photo: REUTERS

Tadashi Yanai, CEO of Fast Retailing (parent company of Uniqlo brand), said that production in China remains important to the fashion company, despite the context that many other multinational businesses are moving out of the country of a billion people.

In an interview with Nikkei Asia , Mr. Yanai affirmed that Fast Retailing has always developed with the Chinese textile industry. Accordingly, the importance of Beijing, or the management of Chinese factories, is "unchanged".

“Tens of thousands of young workers work in a factory in this country, unlike factories in Japan with only about 100 workers,” said Mr. Yanai.

Meanwhile, Nikkei reported that many global businesses, including major US technology companies, are moving towards a "China plus one" strategy to diversify their investments into countries other than China, with some countries with outstanding potential such as India and Vietnam.

These businesses consider factors for the shift such as China's slowing economy , the US-China trade conflict, and other environmental issues.

However, Mr. Yanai made it clear that Fast Retailing said "no" to the "China plus one" strategy, even though the upcoming US President-elect Donald Trump could impose tariffs of up to 60% on imported goods from Beijing.

"There is no easy way to build large-scale factories to replace the facilities in China, where we have many years of experience. Factories in Vietnam cannot be as good as those in China, unless a large number of Japanese personnel are sent there," the CEO of Fast Retailing explained.

Mr. Yanai believes that Chinese manufacturers are the ones who can achieve the criteria of high-volume and high-quality production.

As of September 2, 2024, of the 397 garment factories that are partners of Fast Retailing, there are 211 factories in China, 61 factories in Vietnam, and 26 factories in Bangladesh.

Fast Retailing also cooperates with 155 fabric manufacturing facilities around the world , including 75 factories in China.

For years, Fast Retailing has sent teams of experts called Takumi to partner factories in China, Vietnam and other countries to provide technical guidance such as dyeing and sewing techniques to workers.

Mr. Yanai did not specifically name the country where some factories were performing “not very well” compared to Fast Retailing’s manufacturing partners in China.

He said these factories, although not ensuring high-quality output, still serve a number of other fashion retailers with products sold in the European and US markets.

"Japan has the world's leading pop culture, and people are very strict about (the quality of) clothing regardless of price," Mr. Yanai emphasized.

Source: https://tuoitre.vn/cong-ty-me-cua-uniqlo-nha-may-tai-viet-nam-chua-tot-bang-o-trung-quoc-20241126181652219.htm