Uniform success

By webadmin on 08:37 am Mar 29, 2012
Category Archive

Ardhian Novianto

Most of the guests who visit the operations of PT Sri Rejeki Isman, whether they be ambassadors, military officers or foreign buyers, are mesmerized. Few expect to find a plant spread over a massive 130-hectare integrated manufacturing site.

It’s not a familiar name, but PT Sri Rejeki Isman (Sritex) is one of the largest integrated textile companies in Southeast Asia, with operations ranging right from the spinning of yarn to finished garments, producing annual sales of around Rp5 trillion (around $550 million).

Tucked away in rural Central Java, Sritex hosts a high-tech plant divided into 45 separate units spread over 130 hectares of land that operates with a current workforce of 28,000. Last year sales were up to Rp6.7 trillion and that figure looks to grow quickly, with two new factories to come on line mid-year, boosting employee strength by a further 10,000.

According to Ade Sudradjat, the chairman of the Indonesian Textile Association (API), this puts Sritex among Indonesia’s largest textile companies, a group which also includes Indorama and Kahatex. With a total of 17,000 employees, sales at the former amounted to $204.38 million or Rp1.8 trillion last year. “As Kahatex is a private company, we do not have sales data but it has 35,000 employees and a total factory area of 150 hectares,” he says. “Sritex is better known as a textile company that has a high-end market,” adds Ade.

HM Lukminto, the founder of Sritex Group, started out poor. Born in 1946 in Kertosono, Nganjuk, East Java, Lukminto`s family lived nearby to the family of Harmoko, who went on to become a powerful politician in the last decade of the Suharto era as Minister for Information.

“He was my close friend since childhood,” says Lukminto, who became equally successful, albeit in a less high-profile way. Money was tight and every member of the family had to work hard to survive. “Since I was just a child I was taught to trade. After school, together with my brother, I would sell snacks such as fried peanuts, candy and cigarettes,” he recalls.

“Both our parents always emphasized to us that we had to become successful. We were always taught not to be satisfied with what we had. If today we got the same as what we got yesterday, we were told to think that this actually meant we had made a loss.”

In 1966 Lukminto set off in the textile business as a small retailer. At first he went door to door before he could scrape up the money for a small stall at the Klewer traditional market in Solo, Central Java. Slowly but steadily, his small trading business expanded by producing bleached and dyed fabrics in a first factory on the banks of the Bengawan Solo river in 1968. In 1976 the company moved to Sukoharjo and expanded its production of fabric. Then in 1982, he expanded to spinning and weaving.

“A significant transformation began in 1990, when I decided to move into the upstream industry and built an integrated textile manufacturing operation, from spinning to finished garment products,” Lukminto recalls. “I worked very hard to succeed.  Hard work and discipline, building a strong network and lobby to create trust, and even doing some Javanese cultural asceticism.” 

In the first year after the transformation, with an array of fabrics and the ability to meet high standards, Sritex was able to penetrate the international fashion industry, expanding its markets to 40 countries around the world. Sritex’s fashion clients include top retailers and brands, such as JC Penney, Sears, Wal-Mart, Timberland, Guess, Quiksilver, Gymboree, Charles Vogele, Okaidi, Zara and more.
The group is now a player in the major business league and, while it maintains its focus on the textile business, it has now entered the hotel and restaurant business.

And, adds Lukminto, since 2007 the group has enjoyed sales growth of 25% per year. The group exports between 83% and 90% of production, while the remainder goes to the domestic market. July will see the culmination of Rp2.5 trillion in new investment with the completion of the two new plants.

Read more in GlobeAsia April 2012 printed edition out now at newsstands