Thai Textile Industry PCL

rom modest beginnings, Thai Textile Industry (TTI) Public Co. Ltd. (PCL) has developed
over the years into one of Thailand’s leading vertical suppliers of high-quality fabrics. With an
impeccable sense of timing, a manufacturing enterprise has emerged that is now traded on the stock
exchange and, among other activities, operates a remarkable yarn dyehouse.

TTI — located in Samutprakarn, a roughly two-hour drive from Bangkok — was founded in 1970 as
a knitting shop. The business was subsequently supplemented by a weaving mill and a dyehouse, and
more recently has become a vertical company, with TTI’s current activities ranging from spinning to
making-up. Moreover, as its Executive Director Kumjorn Chuenchoochit explained, TTI has developed
into a listed group with a number of subsidiaries.


Thai Textile Industry (TTI) PCL Executive Director Kumjorn Chuenchoochit

TTI turns 90 percent of the dyed yarn it produces into fabrics for shirts and blouses.
Production takes place in a weaving mill equipped with modern European shaft and jacquard looms.
The products consist of 100-percent cotton, cotton/polyester blends, and intimate blends with
linen. Roughly 10 percent of production is employed in making slightly heavier qualities for
outerwear, and greige fabrics 130 inches wide are woven for bed linen. Accordingly, TTI’s main
customers consist of shirt, blouse and bed linen producers.

Chuenchoochit studied economics and finance in the United Kingdom, and has worked at TTI
since 1984. “I started well down the pecking order, and this still helps me today, when seeking to
understand and solve a diversity of problems,” he said.

Step By Step

Chuenchoochit described the continual
improvement of company performance as his personal challenge. “We have to remain competitive in an
increasingly tough market,” he said. “To this end, one needs the right partners for both the up-
and downstream production phases.” He also sees timing as being a factor of vast significance in
every regard.

“Initially, everything began on a small scale, the start being made with a knitting shop,”
Chuenchoochit said. “Then, in the late 1970s, a weaving mill for the production of shirt fabrics
was added. And in the mid-1980s, there followed the listing on the Bangkok stock exchange. This
proved to be an extremely important step in the company’s history and led to the rapid expansion of
our enterprise into its current form.”


Ninety percent of the dyed yarn produced at TTI goes into shirt and blouse fabrics produced
in an extremely clean weaving mill using modern European shaft and jacquard looms.


The dyehouse was designed with a two-floor layout. Allwin yarn-dyeing systems for medium to
large batches are located on the left side of the hall.

Wide-Based Markets

According to Chuenchoochit,
approximately 70 percent of TTI’s production is exported — 35 percent directly and a further 35
percent by foreign customers. The remaining 30 percent of output remains in Thailand for additional
processing. TTI deliberately does not have especially dominant export markets. “We wish to keep our
production on the widest possible base and not rely on particular markets,” he said. “Nonetheless,
we enjoy an especially high reputation in the Middle East. This approach also is the reason why
there is no outstanding main seller in the product program. In-house collections are also not
created, production being exclusively to customer order.”

When asked about the current market, Chuenchoochit responded by saying the market for
yarn-dyed goods is positive. “The problem is not a lack of orders because the demand for dyed yarn
goods is positive,” he said. “Our difficulties are caused by the strength of the baht, which
hinders our exports. At present, we are confronted by a Thai currency which is 20 percent up on its
usual exchange rate against the US dollar, in which we sell 96 percent of our production.
Therefore, we have been forced to raise our prices, which was easier said than done. The baht is a
free currency and not tied to the dollar, which is the main reason why it has gained some 20
percent in value in the past two years.”


The optically separate right-hand side of TTI’s dyehouse houses the Labwin yarn-dyeing
machines designed for sample and small batches.

Massive Changes

In his more-than-20-year history with
the company, Chuenchoochit has developed a precise knowledge of the market and also has witnessed
many changes. “In the past, we had neither so many, nor such good competitors,” he said. “The
margins, and therefore the prices, were better and not just because of the strong baht.
Furthermore, and this certainly does not apply exclusively to Thai suppliers, the demands of the
market are constantly increasing. In the past, the standard delivery periods amounted to four to
five months, whereas today, everything must be in the hands of the customer within two months at
the latest. Moreover, quality should be continually improved.

“This situation will not change in the future, but instead continue to become increasingly
problematic. Many smaller suppliers will be forced out of the market, and the big guns will become
larger, stronger and better. As I mentioned, we do not intend to compete with the major companies,
and this will allow us to spread our risks more evenly — an approach that up to now has clearly
been successful,” Chuenchoochit continued.

At the present time, TTI operates exclusively Allwin yarn-dyeing systems from Hong
Kong-based Fong’s National Engineering Co. Ltd. “Initially, we only had European and Japanese
equipment, but when considering an investment in a new dyehouse, we asked ourselves if Chinese or
Taiwanese machinery might not be an alternative,” Chuenchoochit said. “We invited Fong’s National
to tender and were positively surprised by the standard and competence of the consulting that we
received. In 2002, Fong’s was awarded the order, and industrial production commenced only a year
later. All in all, we now have 61 yarn- and beam-dyeing machines that process around 1 million
pounds of yarn monthly.”


In the basement, a sophisticated piping system prevents unnecessary heating of the

Special Machine Layout

The dyehouse was designed with a
unique layout. All the Allwin yarn-dyeing systems for medium to large batches are located on two
floors on the left side of the hall, and in keeping with TTI’s wishes, the dyeing machines were
produced in gradually increasing size. The optically separate right-hand side of the hall houses
the Labwin yarn-dyeing machines, which are designed for samples and small batches. As a weaver of
colored fabrics, TTI relies on maximum flexibility and cost efficiency.

In the basement, a sophisticated piping system prevents unnecessary heating of the dyehouse,
and therefore, when one walks through the production hall, one barely notices a difference from the
temperature outside.

Chuenchoochit stated that the biggest advantages of the Fong’s machinery are the low liquor
ratios, a flexible spindle system and multifunctional rinsing system. Moreover, he also pointed to
the price/performance ratio, support during the entire installation period and after-sales services
as other positive factors.

“We are extremely satisfied with the Fong’s machinery, and all our requirements were met,”
Chuenchoochit said. “Should we seek to expand at an appropriate point in the future, we are likely
to opt for the same machines again.

“When we started production, the
major competition came from Korea, Japan and Taiwan, places that today number among our customers,”
Chuenchoochit said. “It may be difficult to credit, but for a long time, one of our greatest
problems was the recruitment of a good workforce. In the past, it was not possible to recruit
foreign workers, but for the past five years, we have been allowed to take on employees from
Myanmar, Laos and Cambodia.

“What we would like to see in the future is open and free trade, which at present is not
always, if ever, the case,” Chuenchoochit continued. “Lip service to free trade is insufficient —
it must actually exist. If certain large countries and continents would give us a fair crack of the
whip, then it will be possible for smaller countries such as Thailand to remain competitive.”

TTI is well-known as a leading supplier of shirt fabrics and yarn-dyed products. “We do not
number among the large suppliers, but we wish to be among the best,” Chuenchoochit said. “We not
only make massive investments in equipment, but also our employees, because our customers should
have confidence in our performance. In this connection, I would like to mention the fact that 80
percent of our customers have been loyal to us for more than 25 years.

Chuenchoochit concluded by saying: “We are also of the opinion that excellent teamwork with
our equipment suppliers is also vital, as to a certain extent we are at the mercy of the market
with regard to our machinery pool. Hence our great satisfaction with Fong’s National.”

We concentrate on essentials and want to do what we do best as well as possible,” Chuenchoochit
said, describing the company’s corporate philosophy. “This means avoiding an excessively large
product range. We wish to number among the best shirt fabric weaving companies and offer our
customers the correct, desired quality; the necessary value-added; and first-class service. This
represents our ideal positioning.”

“It is still said that Asians continue to lag behind European developments and that there is a
lack of research and development capacity,” Chuenchoochit said. “This is not entirely false, and
the final analysis relates to the fact that education in general, and that of the workforce in
particular, has to be improved. We are working with our employees intensively in this regard,
especially in the finishing area, where we wish to be creative.

“Relationships with our suppliers, especially those in the machinery and chemical production
areas, are of special importance to me. Now, we also have a national Thai Textile Institute, a
government-supported body in which I am personally extremely active. These are just two examples of
how we can extend our knowledge and thus improve our chances,” Chuenchoochit added.

September/October 2007