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Heavy-Knit Business in Bangladesh

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Mamun Abdullah, Business Unit Manager, M&S

whatsapp-image-2021-01-06-at-2-40-38-pmHowever the  COVID-19 has changed the way retail apparel business will be done from now onwards—the pre-Covid-19 era business model was all about being Pro-active, whereas, the post Covid-19 era is a very Reactive business model,  in which the customers /buyers will wait till the maximum possible time to gauge how the market behaves and reacts to trends and situations before making decisions, hence, this new business model mandates shorter lead-time, quick sampling, swift communication and first-time perfect execution from the suppliers on samples and bulk. As per my opinion 2021 sweater business will be started with slow pace for this pandemic reason but after vaccination take place in Most of the countries in EU & USA then things will move faster, hopefully at the end of the year 2021 we will see a positive growth.

Bangladesh is majorly disadvantaged and has a big challenge in adopting to the new Reactive business model due to the dearth in backward integration in yarn spinning, especially fancy and structured yarns, as currently China holds a big advantage on this and 90% of this type of yarn is still manufactured in China; hence, they have a very big advantage on sample and bulk lead-times, which is of paramount importance to the new reactive business model; until Bangladesh make significant investment on this area, Bangladesh will continue to lag behind China and will drop further away with the new situation.

In my view, this is the single most Important factor that will help to grow the heavy-knit business in Bangladesh; on the other hand, failing to invest in this area, will significantly reduce the heavy-knit business from Bangladesh in the coming years, as we will always fall short on the key performance areas- shorter lead time, quick sampling, and product innovation.

Secondly, an important factor that is shaping the retail industry is the profile of the new end-customer, who is defined as the “Conscious Customer” this new customer profile is conscious about the way their decision making and living style is contributing to the nature and the world at large; “Renewable”, “Recycled”, and “Sustainable”  are the words that shape their decision making when it comes to buying apparels, hence it is of paramount importance that the retailer/manufacturer takes this new customer profile in to serious consideration in their sourcing strategy—sustainable material, renewable energy, globally accepted compliant working method are key to this– failing to do this will result in loss of business for the retailer and for Bangladesh eventually.

And finally, for Bangladesh, to make that leap to get to the next level, sweater manufactures has to invest sufficiently to improve and upgrade the product capabilities, skill enhancement, cost management productivity and organization maturity to match China and Vietnam, because low prices will no longer be the critical competitive component for business growth.

Strengths :

One of the strengths behind the success of RMG of Bangladesh is the availability of low cost labor compared to other countries in the region. The labor rates in textile industry show that the average hourly wage rates for Bangladesh, India, Pakistan and Sri Lanka were respectively US$ 0.23, $0.56, $0.49 and $0.39. Being in the manufacturing of RMG for two decades, Bangladesh now posses a large pool of skilled & semiskilled manpower. Moreover, there are many unemployed young men and women who can easily be converted into a skilled workforce if needed. Given the fairly long learning curve in this industry, extensive experience in dealing with foreign buyers, offshore bankers, shippers, and Clearing and Forwarding (C&F) agents is a valuable asset for the exporters of Bangladesh. Also few other positive notes as below :-

**Due to global Geo politics ….lots of brands are on process to shift their orders from China to other suitable countries.(lots of USA ,Japanese & others are in the list)

**Bangladesh have large number of factories which are well compliant along with massive capacity.

**Many factories have their own product development team along with efficient merchants , marketing, production team.

**Stable political situation

**Quality product with competitive price

**few factories can offer very sharp lead time even better than China.

Weaknesses :

Dependence on others for raw materials, low productivity, limited knowledge in international marketing information, poor infrastructure, disruptive trade unionism, inefficiency in port management, and excessive dependence on RMG sub-sector are the major weaknesses of the industry.

And most of the factories doesn’t have their own R&D team. They completely depend on customers t-pack and design team, and we are not offering diversified product ranges which need to be improved  rather depending on basic products, we have very limited options for fancy yarn in local, we are not very efficient in our product presentation, and only few factories can manage short lead time orders.

 

Explore to New Products:

>Knitted Night wear

>Knitted beach wear

>knitted active wear

>knitted lounge wear

>knitted accessories, hats, beanie, gloves, Scarfs mittens, bedroom slippers, masks etc.

 

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