Joseph Seroussi, owner of J&R Enterprises, one of Romania's biggest clothing manufacturers, which employs around 6,000 people, stated that he had cancelled contracts with renowned retailers, such as Hugo Boss, a company that chose to sign partnerships with manufacturers in Turkey.
"We did deliver suits to the parent company of Hugo Boss, but we will stop because they did not agree on the price we offered. At the time, they said they could get much better prices in Turkey," said Seroussi.
The businessman explained there have been instances when the company has lost foreign partners because of personnel shortages, which rendered it unable to deliver international orders on time.
"I'm currently in the situation where I have to reject contracts because I don't have enough workers. At present, I could sell three times more than I manufacture, but I will have to wait. Despite losing money, we will try to stay afloat for as long as possible, at a moderate rate. At a some point the industry will rebound and I expect this to happen within the next five years," explained Seroussi.
Companies in the textile industry have been seriously hit by the wave of employees who emigrate to work abroad, which has created a vacuum on the domestic labour market. The number of employees at factories owned by Seroussi has fallen by more than 1,000 people over the past two years, a trend that is expected to continue.
"This is a very serious issue. I sensed back in 2005 that something would happen for a limited period of time, but I didn't predict that it would last for so long. In 2006, I employed around 7,000 people and now there are less than 6,000. In the West, the salary of a textile industry worker is 3 times higher than in Romania. However, many of the people who decide to leave are not aware that their expenses are 5 times higher abroad," stated Seroussi.
The average salary in Seroussi's factories revolves around 250 euros, but the owner says this is the maximum amount that he can offer.
The immediate result of employees leaving to work abroad was a cut in production, from 1 million suits produced per year to 700,000 suits, and a reduction in the number of shifts.
"I reduced the number of shifts from two to one, but this is the best I can do. People suggested to me that I should move the factories to Ukraine or other countries, but this is not an option I will consider," added Seroussi.
Amid a reduction in production, exports were also affected and have lately witnessed a 30% decline. A solution would be the return of workers who left Romania to work abroad.
Seroussi first came in Romania in 1965, and up until now has made domestic investments worth above 90m euros. Seroussi said that if he had to start from scratch again today, he would probably invest in real estate and retail.
On the retail segment, Seroussi owns 4 No. 36 stores and another 27 stores that operate under the shop-in-shop concept.
Joseph Seroussi
First arrived in Romania in 1965 and up until now has made domestic investments worth above 90m euros
Owns stakes in Ikos Conf in Odorheiu Secuiesc (with a turnover worth 14.8m euros in 2006), Norada also in Odorheiu Secuiesc (8m-euro turnover), Serconf in Botosani (7.3m-euro turnover) and T.J.R. Industries in Tulcea (0.7m-euro turnover)
On the retail segment, Seroussi owns 4 No. 36 stores and another 27 stores that operate under the shop-in-shop concept
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