MALAYSIA: Top Glove to focus on increased automation, better human capital - chairman

The world's largest rubber glove maker Top Glove Corp Bhd, which targets 30 % of global market share by 2020 from the 25 % presently, will focus on increased automation and hiring highly qualified researchers.

Speaking at the FMM Factory Management Conference 2016 in Petaling Jaya, Top Glove chairman Tan Sri Dr Lim Wee Chai expressed the company's desire to improve its business processes in the wake of increased challenges faced by the manufacturing industry.

He explained that the glove business industry had become more competitive. "I remember 20 years ago we used to produce rubber gloves with heavy cost and with quality that was not as good as now. Twenty  years ago the price was USD 80 (MYR 353.32) for a carton of 1,000 gloves. Today the export price is about USD 20. Can you imagine? The price dropped so much. But the quality is better. We have no choice but to reduce the cost. If we don't reduce it, we'll be out from the market. So we have no choice but to [continue to] invest in research and development.

"Why do so many [in the field] leave Malaysia for other countries? There are not enough factories in Malaysia. We [also] need to invest in more factories in the country" said Lim.

Lim said Top Glove hires 200 to 300 fresh graduates every year and aims to hire more than 300 next year.

"Investing in local talent is good for [the] long run. We need to reduce the number of foreign workers that we hire," he said.

"We [can] save a lot; over the past three years we've saved [hiring] 1,000 workers. Now one worker costs MYR 2,000. So 1,000 can save us MYR 2 million a month. In a year we can save MYR 24 million. In 10 years we can save MYR 240 million. There's a lot to save. So it's the right direction to invest in automation. However, automation requires research. So research requires hiring [more] graduates, scientists, chemists," he added.

Asked whether he was pleased with the quality of work of local graduates, Lim commented, "University Malaya produces good graduates. [However,] they can be better, compared to German graduates for example."

"Hiring foreign workers [involves] cost that is very high. The quality of product is not consistent as compared to products produced by automation. In the long term the cost will go down," he added.

The company currently owns and operates 28 factories across Malaysia, Thailand and China with a total of 500 production lines and production capacity of 46.6 billion pieces of gloves per annum. It serves a growing network of over 2,000 customers in 200 countries. As at 26 Sept 2016, Top Glove's market capitalisation stood at MYR 6 billion or USD 1.5 billion.

Source: Daily “The Edge Market”, Kuala Lumpur; 22 Nov 2016

(Syed Rashid Ali, Karachi, Pakistan)