Two Central Java Garment Firms Go Bankrupt, Over 1,400 Workers Face Layoffs

Two major garment manufacturers in Indonesia's Central Java province, PT Victory Apparel Semarang and PT Samwon Busana Indonesia Jepara, have ceased operations, leaving more than 1,400 workers facing job losses.

The companies' bankruptcies stem from prolonged financial losses. PT Samwon Busana Indonesia reportedly incurred losses for five consecutive years, while PT Victory Apparel faced financial difficulties starting in late 2025. Officials cited the lingering effects of the COVID-19 pandemic, ongoing issues with buyers, and persistent problems with raw material procurement as key factors contributing to the firms' downfall.

An audit by a public accounting firm confirmed the significant financial distress of both companies. Before closing, PT Victory and PT Samwon reportedly explored various measures to sustain their businesses, including furloughing staff, reducing working hours, and eliminating overtime pay. The decision to close was presented as a last resort after these attempts failed.

PT Samwon Busana Indonesia is scheduled to officially cease operations on August 1, 2026. Details regarding PT Victory Apparel's closure timeline are still pending. Both companies are currently engaged in mediation processes with their affected employees to ensure the fulfillment of their post-layoff rights. The Central Java Manpower and Transmigration Office is overseeing these mediations, with local labor departments providing support. At PT Victory, 807 workers are impacted, with some already reaching agreements on severance pay, while others continue negotiations. PT Samwon faces layoffs for approximately 600 workers.