Prepared By : Mazadul Hasan sheshir
13th Batch (session 2009-2013)
Department : Wet Processing Technology
Blog : www. Textilelab.blogspot.com (visit)
Department Of Textile Engineering
I/A 251,252 Tejgaon Dhaka Bangladesh
Prepared By :
Initial level of Textile
Sector in Bangladesh
Initial level RMG Sector in
There were only 9 export oriented garment manufacturing
industry in 1978, earned only 1 million dollar.
Some of them were very small, produced RMG for local
market as well.
Four such small and pioneer garments were Reaz garments,
Paris garments, Jewel garments and Boishakhi garments.
Reaz garments established in 1960, as a small tailoring outfit,
named Reaz store in Dhaka. Served only domestic market of
its initial 15 years.
In 1973, it changed its name to Reaz Garments Ltd and started to export by
selling 10 000 pieces of shirt to France, valued 13 million franc in 1978.That
was the first direct export of apparel.
Desh Garments Ltd., first joint venture in Bangladesh, Technical and
marketing collaboration with S. Korean Daewoo Corporation, established in
First 100% export oriented company.
In 1980, Youngone (49%) and Trexim (51% equity) formed a company named
younone Bangladesh exported first consignment of padded and non padded
jackets to sweden in dec 1980.
It had trained 120 operators including 3 women in S. Korea Went to the
production in 1980.
Till to the end of 1982, there were only 47 garment manufacturing
Break through occurred in 1984-85 when numbers of garment
factories increased to 587.
In 1999, there were 2900 garment factory in the country.
Average growth rate of garment export is 22%.
Now, the numbers of garment manufacturing units in Bangladesh is
1. GATT Approved multi fiber agreement (MFA)
3. As a LDC, get preferential access in EU.
1. 5% cash incentives
2. No import duty
3. Bonded warehouse facilities
4. Back to back L/C
5. Concessionary rates of interests
6. FDI of Joint venture facilities
7. Concessionary duty on imported machinary
8. EPZ facilities
Michael Porter in 1985 introduced in his book ‘ The Competitive
Advantage: Creating and sustaining Superior performance’ the
concept of the Value Chain.
Michael Porter suggested that the organization is split into ‘primary
activities’ and ‘support activities’.
Primary activities: Operation, Logistics, marketing, Service,
Support Activities: Procurement, Technology development, Human
resource mgt, Infrastructure.
Almost complete value chain
Some of the factories fully vertically integrated : Spinning to
Competitive wage, Easily trainable workforce, Expanding supply
side capacity, government supporting policy helped to gain
Core strength is backward linkage.
90%-95% knit fabric produced locally
Net export is higher than woven.
In FY 2006-07, Export share of knit and woven
were 37.39% and 38.25% respectively.
Cumulative average growth of knitwear is 27%.
Advantages of Bangladeshi Knitwear:
Self sufficient – 95% fabric and
Good capacity exists
Unbeatable in price
Cheap labor with high stitching capability
Good reputation of Bangladeshi Knit
apparels all over the world.
Only a few weaving factories that offer quality product.
So, majority of fabrics has to be imported – higher purchasing cost,
dependency on external supplier, pricing disadvantages.
Can meet only 15% of fabric demand.
More than 220 modern weaving mill need to be set up, each with an
annual capacity of 10 million yards.
Annual Consumption of fabric: 3 billion yards.
• Supporting Industry
• Spinning, weaving/knitting, dyeing, finishing Industries.
• In addition to these, Interlining, labels, buttons, sewing threads, packing
and packaging materials, zippers, draw strings all are backward linked
• 70% of accessories collected locally.
• Share of BB L/C in total export dropped from 68.33% in FY 1995 to
45.1% in the first eight months of FY 2001.
• Total investment in backward linkage is US$ 2B.
Competitive price advantage due to cheap labor and Governmental
Skilled Human Resource
Duty and Quota free access and GSP in EU
Integrated Supply Chain, Specially in Knitwear
International Image of a reliable supplier of basic Products.
Weak Structure, in particular production efficiency, product
development, marketing skill, customer service, controlling, planning,
management skill, technical know how
Producing mainly basic products,
Heavily depend on importing woven fabrics, low value addition
Poor image of adapting international and Corporate social standards
Political, Social and worker unrest.
Potential for higher value addition by developing backward linkage.
Reduce lead time by developing infrastructure of transportation, faster custom
clearance, strong backward linkage
Improved image by adapting environmental and social standards
Diversifying apparel product; switching from basic product to fashionable
May get preferential access in USA and Canadian market in near future.
Risk of loosing competitive advantages-development steps required.
Poor political and investment climate leading declined interest of
Poor capital formation
Risk of loosing know-how transfer, staff qualification,
Totally depend on others for raw materials as Bangladesh produce
neither natural fiber nor MMF.
Increased international competition
Woven sector requires huge investment
Single market concentration
The government of Bangladesh undertook significant steps during the 1980s.
Consequently there was a tremendous increase in the export of ready-made-
garments and knitwear, which garnered maximum foreign exchange for the country.
Cheap labor and low conversion costs are the major factors behind the growth of
Bangladesh’s garment industry. Over 3 million Bangladeshis (90% women) are
employed in this industry. Bangladesh shares excellent trade relations with the US,
showing noteworthy trade surplus with the latter. The country is an active partner of
the Asia Pacific Trade Agreement and the World Trade Organization. A number of
export processing zones have been set up by the government to enhance economic
growth by attracting foreign investment.
1. Exports in Bangladesh increased to 3024.30 USD Million in July of 2013
from 2705.50 USD Million in June of 2013.
2. Exports in Bangladesh is reported by the Bangladesh Bank. Bangladesh
Exports averaged 3267.27 USD Million from 1995 until 2013, reaching an
all time high of 15565.20 USD Million in June of 2009 and a record low of
1024 USD Million in October of 2009.
3. Bangladesh exports mainly ready made garments including knit wear and
hosiery (75% of exports revenue).
At first we want to give a special thanks to our Sir for giving us this kind of
assignment. Textile and Apparel sector is the backbone our economy. As a
developing country our improvement cannot be ignored but to sustain in
the cutting edge of the competitive Apparel & Clothing market, the
apparel industry of Bangladesh has to minimize production and
distribution time. So we need to take necessary steps to utilize this sector