MODIFI, the global commerce platform for Business Payments and Trade Management, participated in Denim Expo 2022, which took place on November 15th and 16th in Dhaka. Organized by Bangladesh Garment Manufacturers & Exporters Association (BGMEA) in partnership with Bangladesh Apparel Exchange (BAE), the expo was part of Made in Bangladesh Week – a week-long initiative comprising various events, summits, awards, factory tours, and cultural shows focused on promoting the apparel industry in Bangladesh. Bangladesh has a rapidly growing garment industry, with much of its growth driven by exports to markets like Germany, Spain, France, and the US. The sector contributes over 80% of the country’s entire export revenue and is a key contributor to the rapid economic growth Bangladesh has experienced over the last three decades.
Textile Focus interviewed Matthias Hendrichs, MODIFI’s Chief Commercial Officer (CCO) and Luke Tuttle, MODIFI’s General Manager for North America and Trade Services. Both interviewees spoke with Textile Focus special correspondent Md. Rakibul Islam highlighted the vast potential of the export industry in Bangladesh as well as how MODIFI can further support exporters in growing their international business.
“MODIFI’s contribution to exporters here in Bangladesh can be to help them with their growth trajectory“–Matthias Hendrichs, Chief Commercial Officer (CCO), MODIFI
Q. How do you see Bangladesh contributing to the global trade sector?
Matthias Hendrichs: Bangladesh has an amazing future. We saw in recent years that Bangladesh was able to grow its base of business on the back of fantastic entrepreneurs here in the market [despite] global circumstances – coming out of COVID quickly and taking opportunities from the Chinese lockdown situation, for example – to band build their business in a great way.
Q. What are some of the major significant challenges faced by the exporters in the Textile/apparel industry in Bangladesh?
Matthias Hendrichs: Well, the challenges and opportunities at the same time are maybe the global economies. Whereas we’ve had a very strong probably face a little bit more headwind economically in 2023. However, where there’s a challenge, there’s always an opportunity. I think, for the right exporters here in Bangladesh, you can actually position yourself as a solution to the problem. You can work with your importers overseas to overcome some of the changes, to work on stock and inventory challenges, and turn the challenge into an opportunity.
Q. Can you tell us more about MODIFI and its growth story?
Matthias Hendrichs: MODIFI is a four year old company headquartered in Germany, Berlin. We are active in ten countries around the world, all the way from China to Bangladesh, India, Dubai and the US. We provide financing solutions and payment services to exporters around the world, helping them grow their businesses and overcome some of the liquidity challenges, for example, that Letter of Credit would impose. So our solutions, our services go beyond just providing money. We also offer, for example, shipment checking and other trade management services that are very, very useful for exporters.
Q. Why did you decide to focus on Bangladesh?
Matthias Hendrichs: Bangladesh is an amazing market. Not only are the Bangladeshis some of the friendliest people I have met but also the business and the entrepreneurship is on a very, very high level. I think the future for Bangladesh is very bright, and we as a company have dedicated resources – We have people on the ground; we have an office here in Bangladesh to help, grow this market and even today, it is a significant part of our global business.
Q. What role can MODIFI play in boosting the export industry in Bangladesh?
Matthias Hendrichs: MODIFI’s contribution to exporters here in Bangladesh can be to help them with their growth trajectory. We provide liquidity that is much needed to pay for inventory and for their own raw material supply and help bridge the gap between when your buyers and importers pay you. We bridge that gap in a very smooth and quick manner.
Q. What are some of the important aspects that exporters should focus on while choosing a trade finance provider?
Matthias Hendrichs: It is very important when exporters consider a trade service solution, to pick the right company to work with. 1. You want to partner with someone who understands global trade and is not just active in one or two markets but is globally present and has a team on the ground in most of your relevant markets. 2. You want to partner with somebody who is strong and credible and has partnerships in the back – the financing partners, the banks that help you find a partner that is sustainable for the long term.
Q. Do you want to add any message for the Bangladesh industry?
Matthias Hendrichs: It is my first time here in Bangladesh, but I’m already a big fan of the country. The culture, the food and the people are amazing and I can’t wait to come back here.
“Bangladesh is certainly one of the strongest options for companies looking to diversify their base outside of China.“–Luke Tuttle, General Manager for North America and Trade Services, MODIFI
Q. From the market perspective, how do the buyers in the US or EU see Bangladeshi suppliers/products?
Luke Tuttle: What we’re seeing with Bangladesh for buyers in the US is part of many of their strategies, looking at what has come to be known as a China Plus One, or in some cases, even a China Plus Three – and what that means is large buyers in the US and other countries are looking to diversify their supplier base. Bangladesh is one of the key places to add on to a country from where they’re getting goods, and that gives them country diversification. But in addition to that, we’re also seeing geographic diversification as well. Bangladesh is certainly one of the strongest options for companies that are looking to diversify their base outside of China.
Q. Apart from the payments solutions, MODIFI is also focusing on providing trade management services on their platform? Can you tell us more about it?
Luke Tuttle: The core tenant of MODIFI is to produce a digital platform that exporters can use to manage their trade overall. In the beginning, MODIFI focused predominantly on trade finance, but as those suppliers or exporters are using our tool, they found they needed to do other actions like tracking their shipments. So we’ve added on a shipment tracker and are currently in the development for other services that enable the suppliers to grow their trade. Finance is a key way to help with their liquidity, but there are also things like finding new suppliers, new buyers, understanding the quality of buyers that they work with, where data that we are able to service to them can be used as they make their business decisions about how to grow their exports and their business overall.
Q. You have met a lot of people at the exhibition. How do you feel about it?
Luke Tuttle: This is my first time in Bangladesh, so I wasn’t sure what to expect. But one of the things that’s really come across to me is the amount of innovation from manufacturers. So here I was expecting just to see the denim exposure, to see the materials being produced, but there’s a tremendous amount of innovation in that, particularly in the ESG, so sustainability, but also in the equipment that’s used to create these products. It’s extremely clear there’s a very strong entrepreneurial spirit in Bangladesh. Besides that, the people have been wonderful, the food has been fantastic and the culture overall has been very welcoming. So my perspective on Bangladesh is extremely positive and I hope to come back again soon. To learn more about MODIFI and how they can help you grow your business visit their website at www.modifi.com/bd-en