2024 was a busy year for Hansae. In the last 12 months, the South Korea-based original design manufacturer has expanded its operations in strategic markets to better serve its customers, including behemoth brands like Gap Inc., Walmart and Target.
Two key pillars of this investment are nearshoring and verticality, as Hansae looks to establish textile mills, garment factories and R&D offices closer to its partner retailers, who themselves are increasingly expanding across the globe. By leveraging a combination of proximity and fabric production capabilities, Hansae creates a stronger collaboration with clients while shortening lead times for more responsive production.
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Kyung Kim, CEO of Hansae Co., Ltd., spoke with Sourcing Journal about some of the company’s 2024 highlights and what is next for its vertical development and nearshoring ventures.
Sourcing Journal: Could you outline Hansae’s global growth and acquisition strategy?
Kyung Kim: Hansae is pursuing a global manufacturing capacity balance of 40-30-30 between Vietnam, Asia and Central America by 2029. To do that, we are concentrating on investment and expansion in the Americas.
Another goal is widening our market penetration by expanding to synthetic products, including swimwear, activewear and intimates. Hansae acquired Los Angeles-based synthetic fabric mill Texollini in September, which will be our core facility to further expand our performance and functional product mix.
Also, we are streamlining production through more verticalization, from raw materials to final garments. The recent opening of our third Color & Touch fabric mill in Vietnam will scale our verticalization in Asia. We expanded to a new country of origin, El Salvador, and we hope to begin operation of our all-in-one vertical complex in Guatemala by next year.
Why is activewear such a key focus for Hansae? How are you supporting growth in this category?
K.K.: The activewear and sportswear category showed remarkable acceleration in 2024, surpassing the average growth of the whole fashion market. Interestingly, this expansion is led by new brands, including Hoka, Columbia Sportswear, On, Dick’s Sporting Goods and Vuori, who are splitting the market share of the big four — Nike, Adidas, Under Armour and Puma.
Reacting to this trend, Hansae is engaging new activewear and sportswear clients. Leveraging our experience with Alo Yoga, Athleta and Aritzia, Hansae is adopting a sales task force team model to streamline the initial phase for new brands and offer optimized manufacturing and/or business options. We also share our vast archive and ODM/OEM know-how developed over our more than 40-year history.
How has the need for nearshoring advanced in recent years? How is Hansae adapting?
K.K.: Post-pandemic, nearshoring has been many clients’ key need to minimize supply chain vulnerability. In response, Hansae is investing more in the Americas, where most of our clients are based.
We are also expanding our R&D and sales office footprint in our customers’ home markets, with sales offices in Bentonville, Arkansas; Minneapolis, and San Francisco. We launched a Barcelona R&D office in 2022, and we will be finalizing our Tokyo R&D office in 2025. This will strengthen our access to market trends and design adaptivity, as well as reducing physical distance from our clients.
As you prioritize verticalization, what have been your latest developments in this area?
K.K.: Hansae’s verticalization started back in 2013 with the acquisition of Vietnam-based fabric manufacturer C&T. Now, we are expanding even further in the value chain to yarn manufacturing. With a fully vertical complex project in Guatemala, Hansae is literally building the verticalized value chain by our own hands. What differs here is the consideration of sustainability, closed-loop logistics, traceability and landmark design. We plan to implement a conveyer belt connecting each facility within the complex to minimize unnecessary packaging for transit through the manufacturing process, and the complex will use renewable energy, such as rooftop solar panels and groundwater cooling systems.
Finally, we are in discussions with a renowned architect to design the complex’s buildings, focusing on aesthetics in addition to the usual priorities of efficiency and productivity so it becomes a landmark in Guatemala. The construction project will create jobs and economic opportunities, and we want the resulting structure to be loved by the community in the region.
Hansae’s verticalization has become more about direct investments, implementing the industry’s latest needs and trends and giving back to local society.
What have been Hansae’s biggest wins this year?
K.K.: Being awarded Supplier of the Year from Gap Inc., with recognition of our devotion to sustainability and manufacturing excellence. We were also invited to Walmart’s Sustainability Milestone Summit, where we were the only manufacturer who presented a case study.
Looking ahead at the rest of 2025, what are three main action items or goals for Hansae?
K.K.: First, completing our full vertical capacity to the yarn level.
Second, we will be expanding our business in Europe and Japan, both of which we expect to bear much growth potential.
Lastly, we plan to streamline our way of working. This may include localization of personnel or digitalization of sales, manufacturing and business forecasting on a single platform.
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