Korean Garment Maker Seeks Fullerton Site : Manufacturing: K.U.M. Ltd. hopes to get state agency to issue $4 million in tax-free bonds to help finance plant.
A Korean garment maker whose customers include Victoria’s Secret and The Limited has its eye on a site in Fullerton for its first U.S. manufacturing plant.
K.U.M. Ltd., a subsidiary of Kum Kyung Ltd. in Seoul, is seeking the permission of the Fullerton City Council in a special session tonight to have the California Statewide Communities Development Authority issue $4 million in tax-free bonds to help finance the $6-million project.
The plant, to open by early 1993, would add 100 jobs to the area’s economy by 1995, said Gary Chalupsky, executive director of the Fullerton Redevelopment Agency. The plant would hire 40 people when it opened and gradually add to its work force until it reached 100 employees, Chalupsky said. About 80% of the hires would be skilled workers earning between $10 and $15 an hour. The remaining 20% of the workers will be evenly split between managerial staff and minimum wage workers.
Employees at the plant would use computerized sewing machines to add fine details and embroidery to garments manufactured in Costa Rica for Kum Kyung.
“What is important here is that we are not moving jobs from one city to another,” Chalupsky said. “These are new jobs and that makes it more attractive.”
Kum Kyung, incorporated in 1982, reported sales of about $70 million in 1991. Its U.S. customers include Home Shopping Network, J.C. Penney Co. and Wal-Mart Inc. It also makes clothes that are licensed under such designer labels as Christian Dior and Yves Saint Laurent.
The proposal calls for garments, most of which would be women’s wear, to be finished at the Fullerton site, then shipped to K.U.M.’s United States customers.
K.U.M. Ltd. plans to spend $2 million to buy a warehouse near Fullerton Municipal Airport to house the plant. Another $4 million would be used for site preparation and for the high-technology equipment needed for the operation.
The Fullerton City Council will hear public comment on the proposal tonight, then vote on whether to allow the bonds to be issued by the development authority. Passage appears likely, for the city does not assume any financial risk.
“It’s a requirement that the city in which the manufacturing development takes place has to concur,” Chalupsky said. “The city of Fullerton is not at risk, and we are not issuing the bonds.”
But at least one economist said Fullerton may not have much to gain from the project, arguing that the plant would bring little new revenue to the city from either taxes or spillover spending by employees.
“I don’t know how many Fullerton residents will get jobs,” said Stewart Long, co-director of the Institute for Economic and Environmental Studies at Cal State Fullerton. “I don’t want to sneeze at $10 an hour, but these are really low- to medium-technology wages.”
Long also said that many cities don’t see garment-making jobs as desirable. The industry, he said, is not a very stable business, and many employees often have minimal skills and earn low wages:
“In general, the garment industry in Southern California is not high-technology.”
