Over the past decade TFG's wholly owned Prestige Clothing has become SA's largest apparel maker, helping its parent group - which previously had zero in-house manufacturing capacity - to weather Covid's supply chain disruptions.
TFG CEO Anthony Thunstrom said this week the group plans to ramp up its manufacturing capacity further to keep up with store expansion plans.
"We currently employ 2,470 staff directly in these factories, with an additional 288 previously unemployed youth completing their NQF2 [national qualification framework 2] learnerships in the wings. Prestige Clothing will grow to about 5,000 direct employees over the next three to four years."
This excludes the thousands of indirect employment opportunities created in TFG's ever-growing local supply chain, he said.
The NQF2 is the apparel manufacturing qualification in sewing, cutting or finishing for factory employees.
TFG employs about 22,000 people in SA. The company wants to add 1,000 new stores across its brands - which include Markham and Sportscene - over the next three years, to bring its store count to about 4,000. With this will come new jobs.
The new stores will expand TFG's staff complement in its retail outlets by as many as 8,000 posts.
5,000
The expected staff complement at Prestige Clothing over the next three to four years
In terms of the planned growth in manufacturing capacity, Thunstrom said some existing facilities will be expanded and new plants will be added.
Currently, 72% of its clothing products are sourced locally, and the balance is imported from the Far East - a modest slice that those at the mercy of supply chains in that region might envy.
The disruption to global supply chains was initially sparked by the first hard lockdowns and border closures around the world during the pandemic.
Supply chains are now skewed to the larger, more profitable markets such as the US, which has greater pent-up demand, meaning others such as SA have to wait in line for goods.
Thunstrom said he expects other retailers to ramp up local content, both in terms of the 2019 retail clothing, textile, footwear and leather master plan - which aims to create 160,000 jobs by 2030 - they signed with the government and also to reduce their vulnerability to global supply dynamics.
Even before Covid there were excessive lead times between when orders were placed and when the goods arrived, which was challenging for fashion retailing because trends can change so quickly.
For example, Thunstrom said, before Covid the time taken between goods being ordered from China and their arrival in SA could be anywhere from 150 to 180 days, whereas having local manufacturing means a retailer can get its goods in store within 56 days, in some cases in half that time. This is what informed the group's initial decision in 2012 to adopt a "quick response manufacturing strategy".
Protea Capital Management analyst Richard Cheesman said TFG's move into local manufacturing has been "very fortuitous" given the pressure Covid-induced supply constraints have placed on some other retailers.
He said TFG was "best placed among the South African-listed clothing retailers" when it comes to manufacturing capabilities and the ability to navigate supply-side constraints due to the pandemic.
This week the group added to its capabilities with the official launch of a Prestige Clothing manufacturing facility in Nugget Street in Hillbrow, Johannesburg. The group already has three Prestige factories in the Western Cape and one in KwaZulu-Natal.
The acquisition last week of bedding, duvet and pillow group Granny Goose and associated manufacturer Cotton Traders means TFG has six manufacturing facilities.
The site for the new Prestige Clothing manufacturing facility, which involved the redevelopment of existing premises, was chosen because of its history. Hillbrow, particularly Nugget Street, used to be Johannesburg's clothing manufacturing centre before crime levels rose in the area.
According to TFG, clothing mass production for women's fashion started in 1929 in the Johannesburg city centre. During World War 2, Johannesburg became the fashion centre of SA, with most apparel being manufactured there and elsewhere on the Witwatersrand.
At the launch in Hillbrow on Monday, trade, industry & competition minister Ebrahim Patel said: "If I took you back in a time machine . 70 years ago, you would have seen in this area the heart of the South African clothing industry. This area, together with Salt River in Cape Town, were the two places where sewing machines were humming, buttons were being made . There were hundreds of workers every morning getting off their public transport and streaming into the factories."
Thunstrom said the site had been redeveloped in partnership with sewing machine wholesaler Berzacks, a Bidvest subsidiary.
TFG CFO Bongiwe Ntuli said the Nugget Street property was converted and made ready for modern manufacturing with a view to providing jobs for school leavers from St Vincent's School for the Deaf.
Thunstrom said the manufacturing facility was the first in that area in about a decade. "We will expand it further. We project to employ 150 deaf staff within 18 months. If we add 50-100 students a year, we can get to 500 in the medium term."
Thunstrom said it would take a long time for the greater Hillbrow area to "come right".
"But we are the little jewel in the centre there now and we do have expansion plans."
Graham Choice, MD of TFG's merchandise and supply chain, said the facility aims to be producing between 800,000 and 1-million units of T-shirts, blankets and bags for Jet and TFG's corporate social responsibility projects within the next year.
Patel said the skills training at TFG's new Hillbrow facility was a critical element in the new development.
"This is how South Africa becomes competitive. It is not just by asserting that we want localisation, but by training South Africans," he said.
"Our hands are as skilled as any others who make clothing, and we know we have that capability. Skills training provides opportunity for that innate capability."
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