Beyond Better Business

Despite the highly competitive and quota-laden garments export industry, one company has consistently stayed on the right side of the cut. For 15 years now, CS Garments has been supplying men’s shirts to the demanding European market.

"It‘s basically delivering quality, style and value to the customer. And to be able to do that without being a tyrant, you have to learn to run a business with a firm but caring hand," says Claus Sudhoff, president and CEO of CS Garments, Inc., one of the largest exporters of men’s shirts. "That‘s always been my motto... and that’s always what I’ve been doing."

With production of over a million branded shirts for men every year, few will disagree or argue with him.

"I firmly believe that the measure of business success is not solely based on financial terms but whether or not you have accomplished your social responsibilities to the community to uplift people’s lives" says Sudhoff, whose factory at the Export Processing Zone in Dasmariñas, Cavite currently employs over 400 female workers.

It may sound like just another standard public relations line, but CS Garments’ numerous plaques and citations from different sectors in the local exporting industry prove that his preaching is practised on the factory floor.

The company holds one of the most coveted titles, being a consistent and deserving Hall of Famer as "Outstanding Manufacturer of Garments for Export" given by the Consumers Union of the Philippines, as well as a Child-Friendly Firm Awardee and a Special Mention from the Quality of Worklife group.

All these are a testament to CS Garments’ resolve to provide an opportunity for people to demonstrate the "human face" of business. From the beginning, Sudhoff‘s approach had gone beyond the mere observance of the minimum requirements of law. "We were always willing to share more," he says simply.

"We started with the creation of the Code of Conduct, which is responsive to the worldwide demand that products must be environment-friendly and socially acceptable," he shares. "Ask anyone here, and they’ll tell you we’re for fair payment of wages and benefits, freedom of association, good working conditions, prohibition against corporal punishment, physical and mental coercion, programs to combat child labor and forced labor."

Indeed, looking at the bright and airy factory space and the relaxed but focused workers, one can almost forget that this is a multi-million business with strict delivery deadlines and quality controls to follow.

To add value to all this, Sudhoff also decided to subscribe to principles to strengthen the company’s advocacy projects. He stresses that Corporate Social Responsibility really makes good sense. "We adhere to the nine universally-accepted principles of the Global Compact, a decision which strengthened more the company’s advocacy programs to support various measures and initiatives positively affecting sustainable development through an economic activity," he says. "To put our awareness into action, we’ve collaborated with various sectors of the society to expand more our views and ideas to concretize implementation of our ideals. We are committed to put our heart and resources to it."

That is one side of this success story. The other involves keen business sense and foresight.

The technical reason for Sudhoff’s success is how he went off the beaten path of the local garments industry. Despite the gloom pervading in the garment industry that it is a sunset business in the Philippines and nearby countries, Sudhoff pursued the opposite strategy and invested heavily in the latest technological innovations. He went after a market that is non-traditional for the local manufacturers. Of course, it helps that he knows the European garments market and is able to maintain the high quality standards required at his Cavite operations.

It is therefore no surprise that over the last 15 years, Sudhoff has profitably exported over a million Philippine made shirts every year to Europe even while everyone else was tied up with the quota system in the U.S.

"But I don’t want it to sound like a landmark," he brushes aside compliments on his success. "If I can do it, so can any Pinoy garments manufacturer who is up to the challenge of competing in a world market without the safety net of a quota. That’s a more refreshing way of looking at it, right?"

Quality plays a major role in this business, which is why all the finished products from CS Garments are certified that it came only from the best fabric, the most modern machines and trained workers. It is not surprising coming from someone who has been in the shirt business for most of his life. He was vice-chairman of the Employers Confideration of the Philippines (ECOP) several years back and, more recently, served as president of the Cavite Economic Zone of Investors Association (CEZIA) and head of the European Chamber of Commerce of the Philippines. In effect, Sudhoff likes to see himself now as actually close to being a full-blooded Pinoy–even if he still can’t speak Filipino fluently. He’s been living in the country for over two decades now–his wife is Filipina–particularly in Cavite, where he is openly considered to be one of the province’s favorite adopted sons.

"I think of the Philippines as my home away from home," he says. "I think of the people here just like I would my fellow contrymen. And I think of the employees at my factory just like I would my own family."

On the whole, CS Garments is more than just a manufacturer of fine clothes for men in Europe. It provides livelihood to Filipinos, and attracts foreign money into the economy.It has trained highly skilled workers in the garment industry, the country’s third largest export, and aids locally-made garments find a niche in the highly competitive non-quota European market.

CS Garment has already trained 194 garment seamstresses in an 18-month program over the last five years. The training programs were developed according to German standards and customized to Philippine requirements. Other programs cover such areas as family planning and poverty alleviation in the poorest provinces of the Philippines. Moreover, the high quality associated with German capital goods has given the Philippines dependable infrastructure in very basic services to move the ever-struggling economy forward.

"It certainly goes beyond employing people and making a profit," Sudhoff says. "What we have here is something really special: It’s value creation. That’s what we do best. We devote most of our resources toward innovation, and make sure it rewards our team members and again, extend assistance to the community to make this world a better place to live in.

"I think that’s pretty much what makes a factory as happy and cheerful a workplace as anywhere, don’t you think?"