How We Transformed an Indonesia Spinning Mill into Top 3 Yarn Supplier​

Background

The Indonesia based cotton spinning industry continues to face sustained pressure from rising labor costs, volatile energy prices, and increasing quality expectations from global buyers. In 2018, a two-unit spinning operation with over 60,000 spindles initiated a long-term transformation program to safeguard competitiveness, protect margins, and move up the value chain.


At project start, production was stable but heavily dependent on manpower, predominantly carded yarn, and constrained by quality perception. Competitors with superior quality positioning commanded significant price premiums, eroding market share and profitability.

Transformation Objectives

To sustain manufacturing costs while improving profitability, quality, and capacity through modernization, automation, and calibrated shift from carded to combed yarn production. 



Target: Average Ne 24s, 100% cotton, 80% combed yarn and 20% carded yarn.

Key Challenges

  • 5–8% annual salary escalation and rising fuel/electricity costs
  • Inefficient labor structure causing operational disruptions
  • Limited automation and high manpower dependency
  • Quality positioning below premium market benchmarks
  • Production constrained to 1,190 tons/month

Texcoms Strategic Transformation

Labor Restructuring

  • Transition to management-supportive union with labor outsourcing and regional wage benchmarking.

Strategic Investments

  • Timely, well-planned capital investments aligned with operational priorities.

Spinning Mill Automation

  • Link Coner, bobbin transport/sorting systems, semi-auto packing.
  • Achieved 30% manpower reduction and UKG improvement.

Capacity Expansion

  • 30% spindle capacity increase utilizing unused building space.

Operational Excellence

  • Systematic process re-engineering with standardized work systems.

Product Mix Optimization

  • Increased combed yarn production to drive higher margins/profitability.

Key Achievements

Business Impact

This transformation demonstrates how Indonesia spinning mills sustain competitiveness through strategic management, spinning mill automation, and product mix optimization.

Texcoms operational excellence framework reduced OPEX, scaled production, and elevated quality positioning - turning a cost-pressured operation into top yarn supplier status.

Want to transform your spinning mill? Contact Texcoms today.