Measure the option of continue or closure of the Malaysian or Thailand operations. Should HCF see get downing its ain label? Sing to the instance. HCF have two options either to go on or shutdown operations in Malaysia or Thailand. If they choose to shutdown operation in both Malaysia and Thailand. HCF should see a few things. First. the closing down all mills in Malaysia and Thailand would dearly-won around RM4. 3 million. The costs are refer to the sale of Penang and Butterworth mills ( RM8. 5 million ) . Chieng Mai and Jitra ( RM1. 2 million ) and redundancy payments around RM3. 0 million at lower limit. Here. at that place have advantage and disadvantage of drawing down operation in Malaysia and Thailand. One of the consequence of shuting down is harm HCF repute as quality industry for both men’s and women’s apparels. In add-ons. shuting down the mills in Malaysia and Thailand causes HCF loss of human capital. As said by Teoh Chin Teh. Factory Operation Director. a big figure of employees would hold to be retrenched and most of them are working with HCF more than 10 old ages.
Therefore. it will impact to workers if Malaysia mills are closed. Second. HCF has an option to shut down the mills in Jitra and Chieng Mai merely. The costs of closing down both mills are RM1. 2 million. Besides that. Jitra and Chieng Mai are located in rural country and will do HCF difficult to happen new purchasers to sell the mills instead than Penang and Butterworth mills which is located in strategic location. Other than that. HCF can salvage cost of workers in Jitra and Chieng Mai and concentrated the operation in Penang and Butterworth. Sing the issue about HCF program to hold their ain label. they should take a few consideration before proceed with the planning. First. the cost for apparatus the label is RM32. 1 million ( fixed costs and advertisement costs ) . Besides. the chance Idaho bring forthing ain label is little about 70 % while the successful is merely 30 % . Thus. HCF should non yet started their ain label until the companies acquiring stable and have net income.