Friday, September 20

Protective Apparel Co. Shifts Manufacturing to Vietnam

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Lakeland Industries, a maker of protective clothing for industry, health care and first responders, reported increases in income and revenues – and said it had shifted more of its manufacturing to Vietnam.

The Ronkonkoma-based company said second-quarter net income rose to $1.4 million from $1 million a year ago as net sales rose from $25.6 million to $27.5 million

“Quarterly revenues reached the highest level in company history due in large part to filling backlog orders when not including sales relating to emergency demand,” CEO Christopher Ryan said.

He said the company reported growth “in the Americas, while Europe and China were negatively impacted by currencies as reported in U.S. dollars.”

Ryan also said the company had been expanding production in Vietnam, which isn’t impacted by tariffs. But he said Lakelan decided to grow in that nation even before tariffs became an issue.

“This was not done as a response to tariff wars, but instead was a matter of vigilantly managing our cost structure,” Ryan said. “Simply put, China is far more expensive for manufacturing today as compared to 23-plus years ago when we first arrived there.”

He said the company has “a solid base of sales domestically in China along with both manufacturing and regional Southeast Asian sales.”

“Our China operations currently has a manufacturing team of nearly 540, down from as high as 800 just a few years ago,” Ryan added. “Two years into executing our planned expansion into Vietnam, we now have a manufacturing team of over 750 in this location.”

He said Lakeland has essentially finished its manufacturing expansion into Vietnam “including capital equipment purchases, investments in property and plant, and hiring of staff.”

The company expects to see economic benefits from this shift, although it hopes to see the full impact in about two years.

“While efficiencies are improving, we are not expecting to be fully maximized until the second half of fiscal 2021,” Ryan said. “This gives us ample runway for continued growth in our largest operating market, the U.S., where import tariffs are not applicable, as well as other international markets.”

Many of Lakeland’s products sold in North America are made in Mexico, China, India, the United States and, the company said, “increasin


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