Mohammad Nurul Alam
The ready-made garment sector of Bangladesh has observed an exponential export growth of 10.27 % year-on-year in the last fiscal year. The achievement has been seen amid of huge global economic crisis. But despite of positive business growth sweaters experienced an increase of only 5.35 % during the same period.
Bangladesh earned $5.94 billion through sweater export in the last fiscal year as per the report published by the Export Promotion Bureau (EPB), which was $5.64 billion in FY22. On the other hand, the country earned $46.99 billion in FY23, and the $42.61 billion was marked in FY22.
The heavy-knit sector posted a 39.21% in FY22 year-on-year growth, and it was 12.62 % in FY21 at that time its exports fetched $4.05 billion.
According to industry insiders, the current worldwide situation is impacting users’ purchase powers. They are in short of financial strength to buy expensive products like sweaters. So in comparison to circular knit, the sweater is observing a short fall in regular growth.
Bangladesh’s RMG sector is still lagging behind competitors when compared to worker efficiency. As the country’s apparel production mostly depends on the volume base basic products workers are not well trained for fancy and exclusive products which results in efficiency.
“Now we have the challenge of 4IR, upskilling and reskilling workers for more productivity by learning modern technology and automation. If we can do that, we will achieve them otherwise lose them,” said Abdullah Hil Rakib, Managing Director, of TEAM Group and Director, of BGMEA.
“Skilled manpower shortage is a big challenge for the Sweater Industry” said Md. Raihan Uddin Khan, Managing Director, Ocean Sweater Ind. (Pvt.) Ltd.
Raw materials such as yarn for sweater is not available in the local market unless this is based on cotton. The fancy yarn might need to be ordered from China and also there is a big issue of MOQ to order for lucrative yarn. This is a big barrier to maintaining lead time to grab orders for sweaters, the owner expressed the limitation.
“From my perspective, 1st challenge for this industry is – “Vertical supply chain or inshore yarn sourcing” which can be overcome by encouraging investments in yarn manufacturing” opined Abdullah Al Mamun, Business Unit Manager, Marks & Spencer.
According to Tania Ahmed, Director of Operation, Mitali Group “overcoming the present crisis situations of Bangladesh RMG sector is possible by collaboration and collective efforts.” She also said,” The major challenges of Bangladesh RMG industry today can only be realistically solved and overcome when there is true collaboration can be done among the manufacturers.”
Improper costing method for sweaters is another big obligation to get a competitive price for a profitable business. Many of the factory some time fails to properly calculate of cost during order negotiation and so profit-making seems to be reversed in losses that are becoming a reason for be closure of business. This is the reason why sweater manufacturing units are getting shut due to a lack of profitability and good business growth.
“The garments and sweater manufacturers must be careful with their costings and must keep room for unseen price movements and potential supply disruptions,” said Mostafa Quamrus Sobhan is the Chairman of Dragon Sweater and Spinning. He also said, “During my trips abroad I have noticed that Bangladeshi products are sold at the lowest price spectrums whereas similar products with same fabrics/yarns imported from Vietnam, Cambodia or elsewhere are being sold at a higher price spectrum.”
Md. Jasim Uddin, Managing Director, Texture BD, expressed his views that “We need to improve our product selection knowledge and cost parameters and increase production efficiency to maximize profits. In addition, everyone should analyze the risk parameters before taking any orders, which might increase profitability”.
Another reason for less business growth and profit is – that most Bangladeshi manufacturers are much more interested in catching volume business at a cheap price rather than getting value addition in business. The result ends up with few profits or no profit and because of such minimal profit and income, the industry is losing its strength and competency in the worldwide business.
Md. Sirazul Islam, Former Executive Chairman, of Bangladesh Investment Development Authority (BIDA) expressed an opinion to The Textile Focus “Exporting more amount is not a fact, the fact is how much we are earning by export. If we want to earn more by exporting less amount then we must add value to RMG products, we have to diversify our product range from Basic items.”
