Youngone aims to create global textile-specialized cities

Chairman Kihak Sung [Photo by Lee Chung-woo]

Companies must constantly create new values based on strong financial foundations, according to Kihak Sung, chairman of South Korean outdoor apparel maker Youngone Corp.

“We have been managing our company with the KYUNG GEUN IL SHIN spirit, a family teaching that means respecting hard work and diligence alongside everyday innovation.”

His remarks were made during a recent interview with Maeil Business Newspaper.

Youngone began manufacturing and exporting foreign brand clothing in 1974 and has grown into an original equipment manufacturer (OEM) specializing in sports and outdoor brands. As it celebrates its 50th anniversary in 2024, it has grown into a global company with annual sales of nearly 4 trillion won ($2.89 billion) as of 2023.

Sung founded Youngone at the tender age of 27. An avid sports enthusiast who was active in the mountaineering club in college, Sung brought American outdoor brand The North Face to Korea in 1997 and turned it into a ‘national brand’ with annual sales exceeding 1 trillion won.

The company is targeting a second leap forward in the global market. It has completed a large-scale development center in Bangladesh, its main production base, as part of a ‘textile specialized city’ project and is also exploring new markets such as India and Kenya.

It also redeveloped its former clothing factory site in Seongnam, Gyeonggi Province, into a complex development center for the future fashion industry.

The 77-year-old Sung continues to practice field management by constantly visiting overseas production sites and sales markets, attributing his success in growing the company to his hands-on management approach. He also ensured his second daughter, Youngone Vice Chairman Rae Eun Sung, experienced the importance of field management by having her visit factories from an early age.

[Photo by Lee Chung-woo]

The following are excerpts from the interview.

―How do you feel about Youngone Corp. celebrating its 50th anniversary in 2024?

▷I have never had a moment to relax and reminisce. Time has flown by since the company‘s founding, and now it has already been 50 years. My late father worried that I had a restless personality and could not keep my focus on one thing. But having managed one company for this long, I do not think he needs to worry about that anymore.

―What was the most challenging moment in management, and how did you overcome it?

▷A cyclone and tsunami hit our newly built factory in Chittagong, eastern Bangladesh in 1991, flooding it. I calmed our distressed employees on the ground and urgently sourced fabrics from Korea. We also recruited an additional 700 employees to join the 800 existing employees to run the factory at full capacity. We also informed our buyers that deliveries would be delayed by a month and kept that promise. They were greatly impressed by our commitment to the promise and subsequently gave us a large volume of orders. We were able to make a comeback by prioritizing trust.

―Why do you stick to the principle of field management?

▷Business is not perfect, and everyone has shortcomings. That is why you need to be on-site and check everything yourself. Neglecting this is, in my opinion, a betrayal of customer trust. I make it a point to go to all the production lines and see the finished products. If there is a problem, we discuss it with each other to improve it immediately.

―What is your motto in corporate management?

▷It is KYUNG GEUN IL SHIN. This is a teaching from our ancestral houses, KYUNG GEUN dang and IL SHIN dang, which means ‘respecting hard work and diligence alongside everyday innovation.’ Relying on just one successful product can lead to a sudden loss of competitiveness and induce laziness, so we must always stay vigilant.

―You started investing in India as your sixth overseas production base in 2023. What are your plans moving forward?

▷We were asked by the Indian government to be a key player in an industrial complex being developed to revitalize the textile industry in Warangal, Telangana. India has a high population growth rate and a growing middle class. We expect high-end clothing products to sell well moving forward. We are also planning to invest about $50 million to establish a mass production system in Kenya.

Youngone Chairman Kihak Sung and his daughter, Vice Chairman Rae Eun Sung, pose at the opening ceremony of the Engelbert Strauss R&D center at Bangladesh’s KEPZ in October 2022.

―What are your long-term plans for overseas production bases such as Bangladesh?

▷We have been strongly promoting a textile specialized city at the Korean Export Processing Zone in Bangladesh as part of our 10-year roadmap and have completed more than seven large-scale development centers as a result. We are currently hiring personnel there, and plan to promote similar textile specialization strategies in India, Kenya, and Central America, although the scale and depth will differ.

―Have there been any changes to the domestic research and development (R&D) facilities?

▷We completed a large-scale knowledge industry center in Seongnam earlier in 2024. This is part of a project to actively promote the rapid design and development of products needed in the Korean and global markets. This location has significant meaning as it is where Youngone’s first factory was opened in 1976, closed in 1996, and is now reborn as the Knowledge Industry Center.

―Is there anything new you would like to challenge yourself with?

▷I am extremely interested in Hunminjeongeum, the 15th-century manuscript that introduced the Korean alphabet Hangul. The North Face recently released ‘Hangeul T-shirts’ based on Hangul characters, which have been particularly well-received by foreign tourists. Alongside the Youngone business, I would like to support academic research on Hunminjeongeum.

―What is your vision for Youngone to leap forward as a 100-year company?

▷Although we have grown into an excellent company within our industry, we are still considered a small to medium-sized enterprise globally. I hope Vice Chairman Sung will strive for innovative management and achieve great results moving forward.