Its helps you to gather more knowledge about the supply chain management and how its function, and factors that affecting the business.

2. 2
Table of Contents
Introduction ....................................................................................................3
Why Bangladesh is a good opportunity for investment?...........................3
Problems associated with the supply chain management of Bangladesh.4
Some prospective sectors for diversification ..............................................6
Activities of the Ministry of Supply Chain Management and its impact.8
Risk Management ........................................................................................13
Warehouse and Inventory Management Regulation By Ministry ..........14
Sustainable Supply chain Ministry of Bangladesh...................................15
Impact on Supply Chain Management's Performance Drivers……….. 16
Budget of the Proposal ................................................................................17

3. 3
Introduction:
Almost 80% of the export of Bangladesh is based on garment sector. If it is not diversified, it will
not be possible for Bangladesh to achieve an annual growth rate of 8% by 2020 and sustain it.
Bangladesh has several prospective sectors to diversify out. These sectors are;
 Automobile Sector
 Electronic Sector
 Pharmaceutical Sector
Bangladesh has several supply chain related problems such as, poor infrastructure, insufficient
power generation, high level of corruption etc. The formulation of the Ministry of Supply Chain
Management can focus solely on the development of supply chain process and mitigate all these
problems through different actions which will help Bangladesh to be a new Asian Tiger.
Why Bangladesh is a good opportunity for investment?
In last one decade, Bangladesh’s economy has grown at a consistent rate of more than 6%, making
it one of the fastest growing economies in the Asia. In the last fiscal year GDP growth rate was
7.24%. Last year for the first time, foreign direct investment into Bangladesh crossed $2 billion
and a 44%increase from the year before. Whereas, In 2004 Bangladesh had about 276 million FDI
and this number is increasing day by day.
Now Bangladesh government is actively seeking to attract foreign investment, particularly in the
areas of energy and infrastructure. Many incentives have been implemented through industrial
policy, growth strategy by exports and public-private partnership (PPP).
0
500
1000
1500
2000
2500
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
793 748
961 913
779
1195
1731
1480
1834
2003.53
Bangladesh Foreign Investment
Bangladesh Foreign Investment

4. 4
According to US based international Republican institute, 83% of Bangladeshis surveyed said that
the security situation is good and 77%people believe that Bangladesh is politically stable. In
Bangladesh, there are some favorable factors which attract the foreign Investors:
The cost of establishing business (in Bangladesh) is relatively low and Bangladesh has eight fully
operational EPZs and is setting up 100 economic zones. Today this economy stands at about $180
billion. According to W.B, economy will rise to $322 billion by 2021, creating many more scalable
investment opportunities.
Problems associated with the supply chain management of Bangladesh:
Lack of R&D: Pharmaceuticals and Automobiles sectors have great prospects in Bangladesh with
high potential to grow. But there are lack of laboratories and R&D centers to improve these sectors.
Lack of training: Bangladesh has the cheapest source of labor but this labor force is not efficient
and there are lack of training opportunities.
Insufficient Infrastructure: The entire country is not well connected. Transportation facilities
are not up to the mark. There is no bridge over many rivers, roads are not well planned, and railway
and air transportation services are not reliable.
Financial difficulties: Small and start up enterprises find it difficult to get loans from banks. As
a result, new and prospective sectors have less chance to grow.

5. 5
Location: Almost all the business
activities of Bangladesh are centered
in Dhaka city. As a result
transportation cost, labor cost, and
materials acquisition cost in Dhaka
are increasing.
Lack of utility: It is very difficult for
new enterprises to get gas and
electricity connections. Level of
power generation is not enough to
meet the demand of the entire
country. As a result, companies have
to use back-up power generators
which is very costly.
Complexity in land acquisition:
Companies have to go through a lot of
procedures to purchase and register
lands for new facility improvements.
Insufficient flow of information: Because of the lack of ICT development there is no proper
integration between all the parties within a supply chain. So, sometimes it is impossible to get
necessary information.
Fragmented factories: Basically in the RMG sector a specific company has factories in different
locations with several tasks done in several locations to produce finished products. It increases the
intensity of traffic within factories, bottlenecks, and lead time.
High level of corruption: There are unofficial bureaucratic costs to register a new business. 37
permissions from different government agencies are now needed to open an enterprise.
Lack of diversification: Although Bangladesh has several sectors with high growth potentials,
almost 80% of the exports are RMG oriented.
Lack of country promotion: Instead of being one of the attractive places of doing business in,
Bangladesh has lack of promotional activities to let foreign investors know about its prospective
sectors.

6. 6
Some prospective sectors for diversification:
Some prospective sectors that Bangladesh should focus on for diversification are Automobile,
Electronic, and Pharmaceutical sector.
Automobile sector: Currently, domestic demand for automobiles is met by importing from Japan,
India, and China. Bangladesh’s Automobile industry is one of the fastest growing industries in the
country. According to wordpress.com stakeholders are expecting 25% annual growth rate in the
next five years. Bangladesh has available supply of iron needed to produce automobiles; import
tax on spare parts are comparatively lower and cheap labor forces. So, Bangladesh Road Transport
Authority (BRTA) should coordinate with FBCCI, BSTI, BUET, and NBR to improve this sector.
Pharmaceuticals: According to www.idlc.com, Bangladesh manufacturers can produce drugs at
40%-50% of the cost compared to the rest of the world. Bangladesh pharmaceutical industry have
good chemicals, skilled workforce and process reengineering skills which give Bangladeshi
companies a competitive advantage in terms of cost efficiency. The rising level of middle class
family, level of education, and good machinery and infrastructure have increased the demand for
local medicine brands.
Fig. SupplyChain ofPharmaceuticals
Fig. SupplyChain ofAutomobile

7. 7
Electronic Goods Industry: Electronics industry of Bangladesh produces TVs, Radios,
Refrigerators, Ovens, ACs, Washing Machines, Fans, Lights etc. But most of the spares parts are
imported from abroad and then assembled in Bangladesh. This sector has high possibility to boom
for different reasons. These are;
 Easily attainable consumer loans from banks
 Increasing level of income
 Demand for low cost electronics goods
 Cheap labor force
 Increasing level of electricity production
 Locally available spare parts
Fig. SupplyChain ofElectronic goods

8. 8
Activities of the Ministry of Supply Chain Management and its impact:
Fig.Outlookofthewebsite

9. 9
a) A website to bring suppliers of targeted industries to potential investors and create a
sound phase of supply chain by using a new IT infrastructure:
One of the proposals of Supply Chain Ministry will be to create a website where there
will be 3 parts. 1. Supplier 2. Transportation 3. Business Consultants & Lobby
Houses.
1. Supplier part:
 5 industries’ suppliers will be brought in one web at primary launch.
 Supplier information will be there.
 Suppliers will have account, investors will also have account on that website.
 Investing Enterprises can contact or place order online.
 Supplier Bidding Portal: If enterprises want competitive pricing, they can put
order in “Bidding Portal” where suppliers will bid with the lowest price.
 Supplier Rating: There’ll be “Supplier Rating” given by Enterprises after each
successful trade cycle. Improvement suggestions can also be given.
 Supplier Audit: To ensure the fairness of rating and supplier quality a “Supplier
Audit Team” will be in ministry to monitor suppliers’ materials and service
quality.
2. Transport part:
 There’ll be 4 transport options available Road, Water, Rail and Air freight.
 Each type will have 3 options. Transport Company Information and contact
window, Transport bidding portal.

10. 10
 Transporters will have accounts in website. Through which enterprises can contact
them or give consignment to them on web.
 Transport Bidding: Enterprises or Suppliers (Who has the freight responsibility)
can also place their freight details on transport bidding portal. There’ll be a bid by
transport companies or interested truckers. (Not for Railway)
 Track your Freight: There’ll be a tracking monitor where the vehicle carrying
the freight can be tracked on map. As all registered vehicles will have mandatory
tracking device installed. (Will be imported with subsidy and provided in minimal
cost)
 Trucker Rating: After every successful freight transport companies will also be
rated.
3. Consultancy and Business Development Centers’ Information (Details Covered
Later) Effects of this Plan:
 For starters of 5 specific industries, almost all the information and support from
3rd party will already be provided there.
 Selection of Supplier and dealing with them will be easier.
 Uninterrupted procurement can be ensured by ensuring monitored supply and
transportation.
 Supplier certification can be done through “Customer Rating” and “Supplier
Audit” done by the ministry.
 Information, Sourcing, Pricing, Transportation altogether becomes more efficient
through this online facility.
 Overall, Supplier>Transport>Factory will be totally hassle free.
 Monitored Transportation and Supply can reduce delivery delay, which will
directly reduce the raw materials inventory cost, because sound system will
increase enterprise’s confidence on suppliers and the whole market.
b) 24 Hour DedicatedHelpline to handle any Problem and Corruption in the (a) process:
1. Truck drivers can call anytime wherever they will get stuck for police corruption and
other corruption related problems.
2. This team will immediately handle that via authoritative power to cut cost of the
transportation.
3. Enterprises can complain anytime if they think something is going wrong in the
process. It’ll immediately handle that.
4. The effective side of this service will mainly be a team of efficient police and army
personnel to get authority over any problematic situation.
Effects of this plan:
1. Corruption in system can be countered and solved to smoothen the supply chain.

11. 11
2. System loss in the processes will be reduced, cost will get down, businesses will
boom.
c) Licensed Consultancy and Business Development Centers:
1. There’ll be government subsidized “Consultancy and Business Development Centers”.
2. They will have 2 wings, 1) “SBU and Strategic Operation Related Help Desk”
2) “Business Development Section”
3. 1st unit will help both international and national investors with their Strategic Business
Unit (SBU) related issues (Marketing, Finance etc.) for very minimal fee.
4. 2nd one will deal with all the government procedures to smoothen the business’s fastest
run. They’ll also take care of the customs issues and other corruption related issues.
Effects of this plan:
1. Hassle for investors due to corruption in government offices will be easy to avoid.
2. Low cost SBU and Strategic support can ensure proper growth of those industries.
3. It will affect country’s GDP directly because operation will become efficient and
costs will decrease.

12. 12
d) Research for development:
 This ministry will do extensive research on finding the gaps among every
element of the supply chain cycle.
 They will synchronize with respective ministry (Land, Roads & Highways,
Railway etc. ministry and prime minister’s office) on those findings.
 They’ll search for foreign funds like USAid, UKAid etc. which are encouraging
innovation in Bangladesh to fund Innovative Supply Chain Ideas in Bangladeshi
perspective.
Effects of this plan:
1. Innovation will come out.
2. Those innovations can later on shape the country’s overall supply chain factors in a
better way.
3. Solely development based ministries will be able to predict trade related positive
effects of their development decisions.
e) Country Branding Team:
 “New Asian Tiger” will be the Brand Name for this Process.
 1st Brand Promises Need to be determined by Supply Chain Ministry.
 Then they will work together with BIDA (Bangladesh Investment Development
Authority) to promote this brand inside Bangladesh
 They’ll also work with Foreign Ministry to promote the brand outside of
Bangladesh via Embassies, High Commissions and Consulates.
Effects of this plan:
1. It will help investors understand the promises of Bangladesh Government to make our
country the next “Asian Tiger”.
2. Investors can also be taught about the new IT Infrastructure they can use to set up their
business in Bangladesh.

13. 13
Risk Management:
Bangladesh supply chain ministry will try to identify and
minimize risks in the supply chain. Risk is the big factor
which interrupt the total supply, transformation, delivery,
and customer demand. So ministry will consider many
more strategies such as dual sourcing, buffering, and
forward buying which will minimize financial impact
uncertainties such as yields, timing, pricing, and
catastrophic events. These strategies can be suggested to
enterprises.
Bangladesh Supply Chain Ministry will involve in three step process to mitigate the total risk:

14. 14
Warehouse and Inventory Management Regulation by Ministry:
Warehousing and inventory management is a big issue of every enterprise now a days to maximize
profitability. For that there are various global practices which are,
 Minimum stock level
 Stock review
 Just in Time (JIT)
 Economic Order quantity(EOQ)
 Batch control
 Fixed quantity and interval
 First in, first out (FIFO)
Bangladesh Supply chain ministry will try to promote these concepts to the enterprises for ensuring
their profitable operations. Government is also trying to implement a digital country, so everything
will be computer based. Supply chain ministry will build suitable software for companies to keep
track and control their inventories. Some useful features are given below:

15. 15
Sustainable Supply chain Ministry of Bangladesh:
Supply chain ministry will be more concerned about sustainability. It will build a sustainable
supply chain in whole country and logistics network in terms of environmental, risk, and waste
costs. Sustainability in the supply chain will increase long term profitability and change monetary
cost, value, and speed.
To build a sustainable ministry it will take some steps. Ministry will also push the companies to
follow the environmentally helpful issues. These are given below:

16. 16
Impact on the Supply Chain Management’s performance drivers:
The proposal given above will have direct impact on six performance drivers of supply chain
management of Bangladesh.

17. 17
Budget of the Proposal:
Year 1 Year 2 Year 3 Year 4 Year 5
Land Acquisition cost 1,000,000,000 - - - -
Construction cost 800,000,000 - - - -
Furniture and Fixture 200,000,000 - - - -
Ministry Maintenance cost 120,000,000 120,000,000 120,000,000 120,000,000 120,000,000
Website development 250,000,000 - - - -
Website Maintenance 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000
Software cost 20,000,000 20,000,000 20,000,000 20,000,000 20,000,000
R & D expenses 50,000,000 52,500,000 55,125,000 57,881,250 60,775,313
Audit (Supplier +Transporter) 45,000,000 48,375,000 52,003,125 55,903,359 60,096,111
Lobbying house 600,000,000 250,000,000 275,000,000 302,500,000 332,750,000
Consultancy center 400,000,000 200,000,000 224,000,000 250,880,000 280,985,600
Country Branding cost 200,000,000 200,000,000 200,000,000 200,000,000 200,000,000
Travel cost 250,000,000 262,500,000 275,625,000 289,406,250 303,876,563
Meals and Entertainment 150,000,000 165,000,000 181,500,000 199,650,000 219,615,000
Training expense 220,000,000 220,000,000 220,000,000 220,000,000 220,000,000
Legal costs 200,000,000 230,000,000 264,500,000 304,175,000 349,801,250
Subsidies 500,000,000 550,000,000 605,000,000 665,500,000 732,050,000
Annual Budget of Ministry 5,015,000,000 2,328,375,000 2,502,753,125 2,695,895,859 2,909,949,836
Forecasted Annual Budget for First 5 Years (BDT)
Fixed Costs
IT Management
Total

18. 18
References
1. APICS Supply Chain Council. (2015). SUPPLY CHAIN RISKS CHALLENGES AND
PRACTICES. Retrieved from http://www.apics.org/docs/default-source/default-
document-library/supply-chain-risk-challenges-and-practices.pdf?sfvrsn=0
2. APICS Supply Chain Managers Career Pack. (2014). SUPPLY CHAIN MANAGR
COMPETENCY MODEL. Retrieved from http://www.apics.org/docs/default-
source/careers-competency-models/supply-chain-manager-competency-model.pdf
3. Bangladesh Economic News. (n.d.). Local Motorcycles Could Grab Asian Market. Retrieved
from https://bangladesheconomy.wordpress.com/category/automobilesvehicles/
4. Hutchison, C. (2015). How Much Does an ERP Implementation Cost. Retrieved from
http://blog.clientsfirst-ax.com/blog-1/how-much-is-erp
5. Papon, M. (2013, July 15). The Electronics Industry in Bangladesh. Retrieved from
https://issuu.com/md.papon/docs/the_electronics_industry_in_banglad
6. Rahman, M. M., & Abdin, J. M. (2012, May). Electronic Sector in Bangladesh: Problems &
Prospects. Retrieved from https://www.researchgate.net/publication/256020781
7. Shawon, S. A. (2011). Pharmaceutical Industry of Bangladesh. Retrieved from
http://www.idlc.com/sector_coverage/1332567100Research%20Report%20on%20Pharm
aceutical%20Sector%20of%20BD-Initiation,%20June%2028,%202011.pdf
8. Trading Economics. (2017). Bangladesh Foreign Direct Investment. Retrieved from
http://www.tradingeconomics.com/bangladesh/foreign-direct-investment