This report was prepared on RMG of BD as per the instruction of my respected teacher .....Done by wasim from IBA-ju (2014)..enjoy !!! :D

1. vii
READYMADE GARMENTS(RMG)
INDUSTRY OF BANGLADESH
BASED ON A (2014) STUDY OVER INTERNET
11/5/2014

2. ii
Report On
READYMADE GARMENTS (RMG)
INDUSTRY OF BANGLADESH
BASED ON A (2014) STUDY OVER INTERNET
Prepared for
Arafat Rahman
Assistant professor
IBA-JU
Prepared by
S.M. Aminul Haque
ID-1814
IBA-JU (23rd
batch)
Submission on: November 5, 2014

3. iii

4. iv
Letter of Transmittal
November 5, 2014
Arafat Rahman
Course Instructor, BUS-104
Institute of Business Administration
Jahangirnagar University.
Dear Sir,
In attachment please find the precise report on the “Readymade garments industry of
Bangladesh: Based on a (2014) study over internet” that you proposed us to prepare as
one of the requirements for our Business Communication course. The report has been
prepared focusing on readymade garments industry of Bangladesh, its contribution, limitation
and possibility. The report is furnished with several recommendations that are recommended
to be incorporated to make the industry more efficient.
I am thankfully acknowledging my satisfaction that you have chosen myself to submit the
report.
In presenting this report, i have tried my level best to include the relevant information and to
make the report informative and comprehensive. It was very inspiring and encouraging for me
to get involved in preparing this report as it has given us a scope to have an in-depth review
to get relevant information about the garments industry. My report writing skills have also
improved significantly while preparing this report.
Please feel free to call me for further clarifications regarding this report if required.
Yours sincerely,
S.M. Aminul Haque
ID: 1814
IBA-JU (23rd Batch)

5. v
ACKNOWLEDGEMENT
A lot of efforts and study was made to bring this report to a reality. This would not have been
possible without the selfless support and assistance provided by the people whom I
approached during the various stages of writing this report. Although space and time
prevented me to mention all their names, I am nevertheless thankful and grateful for their
help.
I would like to thank Arafat Rahman for assigning us and giving me the opportunity to work on
such an interesting topic. This has provided me with the chance of working with realistic
aspects, which helped me to acquire clear insights about the subject knowledge and practical
issues of the readymade garments industry.
Last but not the least; I am thankful to the IBA seminar library authority and all my classmates
for continuous support, assistance, and inspiration.

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TABLE OF CONTENTS
Sl Title Page No.
Chapter1
Executive Summary viii
1.1 Introduction 1
1.2 Origin of the report 1
1.3 Scope of the Report 1
1.4 Objective of the Report 1
1.5 Methodology 1
1.6 Limitation 1
1.7 Acronyms 1
Chapter2
2.1
Literature review of RMG sector of Bangladesh 2
2.2 Overview of RMG industry of Bangladesh 2
2.2.0 System of production 3
2.2.1 Management system 3
2.2.2 Major competitors 4
2.2.3 Impact on society 5
Chapter 3
3.1 Prospect In Bangladesh 7
3.1.0 Export performance 7
3.1.1 Contribution to economy 8
3.1.2 Contribution to GDP 8
3.1.3 Reasons behind success 9
3.1.4 Opportunities 9
3.1.5 Future prospect 9
3.1.6 RMG vs other sectors 9
Chapter 4 4.1 Problems of RMG Sector in Bangladesh
10
Chapter 5
5.1 Recommendation 11
5.1.0 Enhancing workforce 11
5.1.1 Economic and political stability 11
5.1.2 Infrastructure and Communication Development 11
5.1.3 Improvement of product quality 11
5.1.4 Online Marketing 11
Chapter 6 Conclusion 12
Reference 12

7. vii
LIST OF ILLUSTRATES
LIST OF TABLES
TITLE OFTABLES:
1.Bangladesh vs Vietnam in export performance…………………………………………………………………5
2.Export performance of Bangladesh (lastthree financial year)…………………………………………..7
LIST OF FIGURES
TITLE OFFIGURES
1.production process……………………………………………………………………………………………………………..3
2.Urbanization level of Bangladesh………………………………………………………………………………………..6
3.RMG export performance of total export…………………………………………………………………………… .8
4.GDP performance for lastfiveyears…………………………………………………………………………………....8
5. RMG vs other sectors contribution…………………………………………………………………………………….10

8. viii
EXECUTIVE SUMMARY
The macro economic performance of Bangladesh is heavily dependent on its Readymade
Garment (RMG) manufacturing sector. After the failure of jute sector, the demand of RMG
has dramatically risen. The RMG sector alone does export worth $21.5 billion a year, which is
79 percent of the total export earnings of our country.
Currently some of the leading companies of Bangladesh in garments sector are Ha-Meem
groups, Squire fashion limited, Mohammadi group,Habib group ltd etc. They have some
common departments for smooth functioning their production.
RMG has a tremendous effect in our society. Women empowerment has established and
increased, job sources has been created, population growth rate has been fallen but it has
also promoted child labor.
RMG has improved the economic sectors like agricultural, industry as well as GDP of
Bangladesh. More jobs have been created. More people have been employed and has also
developed the GDP of the country.
The fact that the RMG sector has responded to calls for taking initiatives to improve the
wellbeing of its workers by means of opening up health and recreational facilities is helping to
improve its image as a responsible sector to foreign buyers. It is not only the Scandinavians
who have faith in Bangladesh's potential to become the country of choice for sourcing
different types of garments but also other big guns like USA have facilitated our RMG sector.
Bangladeshi RMG is growing in a vast way. Expanding RMG sector has to face some
competitors.one of the major competitors is Vietnam which is proved a challenging competitor
for our RMG sector.
There are some reasons lying behind our RMG sector’s success. Flexible labor market law,
availability of raw materials, price competitiveness are one of them.
But some of the problems are slowing down our RMG sectors growth just like infrastructure,
political instability, poor transportation system etc.
Here are some personal recommendation for the well growth of RMG sector and eradicating
its problem:
 Provide structured in-house training for workers and managers.
 Ensure fair wages and incentive schemes.
 The long term partnership should be established between the suppliers and buyers.
 Investment in education requires broad initiatives.

9. Page | 1
CHAPTER-1
1.1INTRODUCTION:
Readymade garments sector is very popular and prospective business among microfinance
sector. RMG sector in Bangladesh is based on different manufacturing units and mostly
located in industrial areas, operated by the workforce. Total number of workforce associated
with the industry stands approximately over 4 millions working in more than 4500 garments.
1.2 ORIGIN OF THE REPORT:
The purpose of this report is to familiarize students with the basic issues of “READYMADE
GARMENTS OF BANGLADESH”. Arafat Rahman, Assistant professor, Institute of Business
Administration, Jahangirnagar University authorized it, on October 15, 2014 and it is
supposed to be submitted on November 5, 2014.
1.3 SCOPE OF THE REPORT:
The report describes about the present situation of Readymade garments industry of
Bangladesh and the future prospects and opportunities available in this sector.
1.4 OBJECTIVE OF THE REPORT:
 To be familiar with readymade garments sector.
 Impact of RMG in Bangladesh
 Contribution of RMG in economic sector
 prospect of RMG
 Problems regarding this sector
 Problem solving way
1.5 METHODOLOGY:
This report is based on secondary data. All data have been collected from internet
1.6 LIMITATION:
 Time constraints
 Lack of prior experience
 Unavailability of data over internet
1.7 ACRONYMS:
1. FY= Fiscal Year. 2. BGMEA= Bangladesh Garment Manufacturers and Exporters
Association. 3. RMG= Ready-Made Garments.

10. 2
CHAPTER-2
2.1 Literature review of RMG sector of Bangladesh:
Ready Made Garments(RMG) are mass-produced finished textile products of the clothing
industry. Some common types of RMG are shirt, pant, sweaters ,T-shirt etc. Origin of the
RMG was after 1970 after the decreasing demand of jute industry . It took decades to stand
itself as the leading profit making sector of our country. Today with many public and private
organizers are giving the technological and other facilities for the this sector as a result it is
becoming strong and has shaped thus today.
There are two types of process for producing RMG in our country. They are Knitted and
woven. Among them Knitted is mostly used. Every year RMG earns the most of our
economy. BGMEA is formed for the welfare and maintenance of RMG.
2.2 Overview of RMG industry of Bangladesh:
RMG sector in Bangladesh is comprises with large manufacturing units. It is located in
industrial areas operated by large workforce along with technique for producing goods in
Garments industry complex . The number of workforce associated with the industry stands
about four millions. There are various types of products from RMG.
Historically Bangladesh focused on producing Woven garments but in recent times
Bangladesh is more successful in Knitwear production . Bangladesh is exporting its RMG in
most of the economic developed country. Many foreign buyers come to Bangladesh for
buying its products. Bangladesh exports its RMG in many international brands like H&M,
C&A, GAP, UNIQLO, M&S, Wal-Mart etc. exported RMG products are:
 Shirts
 Pants
 Sweaters
 Jeans
 T-shirts
 Blazers
 T-shirts & Polo shirts
 Tank tops,
 Pajamas,

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 Sport wear,
 Under garments,
 Men’s & Ladies fashion wear
 Kids wear
Leading RMG companies of our country are:
 Ha-Meem groups
 Squire Fashion Limited
 Apparel Fashion BD
 Mohammadi Group
 Habib Group ltd
 FORTUNE GARMENTS LTD.
 FRIENDS WORLD KNITWEARS LTD.
 A & H ENTERPRISES LTD.
 3A GARMENTS & HOSIERY (PVT.) LTD.
 A J FASHIONS LTD.
2.2.0 System of production:
RMG products are of two major types:Knit garments and Woven garments. Firstly,natural orman-made fabrics
are transformed intoyarn through spinning process. Then they are converted woven or knittedfabrics by the
virtue of weaving or knittingprocess. After that,through cuttingand sewing process, garments products are
made. Here is an illustration showing the production process:
Figure 1:Production process of apparel or garments
Source: http://www.fairbd.net/Details.php?Id=524
2.2.1 Management system:
Management system of most of our garments are:
Merchandising department:
The term merchandising defines as buying and selling of products. However, there is a
specific meaning for garments merchandising which means buying raw materials and
accessories, producing garments, maintaining required quality level and exporting the

12. 4
garments within scheduled time (Nickels, J. M. McHugh; 1986). This department performs a
very significant role in satisfying customers by delivering specified goods of specified quality
on designated date and time.
Supply chain department:
The supply chain department mainly involves in procurement of raw materials, equipment,
design, and distribute among the stakeholders related to production and distribution channel.
Commercial Department:
The commercial department is responsible for maintain of business relationship with the
buyers, buying agents, banks, suppliers. This department performs significant role in handling
following documentations relating to import and export performance;
Production department:
The production department is the key department that ensures the quality, consistency,
design and time bound full production of garments and knit wear products (Nickels et al.).
There are several sub departments under this section that involve in making finish products
starting from cutting of fabrics and stitching of dress
Compliance department:
This department fulfill the rules and procedures for better ways to protect the health, safety,
and fundamental rights of the employees. Also create congenial environment in which they
operate. In general, compliance conforms the rule, such as a specification, policy, standard or
laws (Kotler & Armstrong, 2006). Regulatory compliance describes the goal that corporations
or public agencies aims to in their efforts to ensure that personnel are aware of and take
steps to comply with relevant laws and regulations.
Human resource management:
The term human resource management refers to the process of human resource needs and
then recruiting,selecting,developing,motivating,evaluating,compensating, and scheduling
employees to achieve organizational goals (Nickels, J. M. McHugh; 1986).
2.2.2 Major competitors:
Bangladesh RMG sector is facing tough competition from china, India and Vietnam.
Vietnamese garments companies are strengthening their business in markets, putting more
pressure on the Bangladeshi garments sector. Garment exports from Bangladesh was
12.69 percent to $21.51 billion in 2012-13 from the previous year, on the other hand it was
6.97 percent to $19.9 billion in 2011-12 from 2010-11, according to BGMEA analysis.
Bangladeshi exported garment items worth $17.91 billion in 2010-11 and $12.5 billion in the
year . Now , the number of garment factories in Bangladesh is 5,000 and 2,000 in Vietnam,
according to the McKinsey report.

13. 5
Table 1:Bangladesh vs Vietnam as export competitor
Source: http://archive.thedailystar.net/beta2/news/vietnam-a-close-competitor-to-
bangladesh-rmg/
2.2.3 Impact on society:
RMG has changed Bangladeshi society, changed the workplace condition.in the past men
were the mostly worker but with the rise of garments industry the situation has changed
reversely. In RMG sectors, not men, women are the major participants.80% of the garments
workers are women.
WOMEN EMPOWERMENT:
The garment sector is the largest employer of women in Bangladesh.[3] The garment sector
has provided employment opportunities to women from the rural areas that previously did not
have any opportunity to be part of the formal workforce.
CHILD LABOR:
The bitter fact is the rate of success in the RMG sector has also resulted in the worst form of
child labor in many factories, especially in the non-compliant ones. In cases, it assumes the
form of even bonded labor.
STADARD OF LIVING:
RMG has dramatically increased the standard of living in Bangladesh. People with low
income are improving their condition with the money they earn. Though their money is not
sufficient enough but have been able to increase their standard of living.
EDUCATION GROWTH:
Educational rate has been risen as an impact of RMG in society. Garments worker are mostly
women. So, they don’t get enough time to look after their child. As a reason, they get their
children admitted into school. Another reason is improved financial condition of garments
worker.

14. 6
URBANIZATION:
A statistical report says that In 1985, urbanization level in Bangladesh was only 13.4% while
it is expected to be dramatically risen 37.3% in 2025.This statistical report proves that RMG
has a sweeping effect for the urbanization in Bangladesh. By urbanization, there has been
major changes in our country.
Figure 2: Urbanization level of Bangladesh
Source:http://ww2.unhabitat.org/habrdd/conditions/socentasia/banglade.htm

15. 7
CHAPTER-3
3.1 prospect in Bangladesh:
Prospect of RMG in Bangladesh is facilitated by diversified and supportive retails. They are
given below:
3.1.0 Export performance:
RMG has a significant effect on Bangladeshi export .In 1983 the export was
31.57million $(USD) where total export of Bangladesh was 811 million $(USD), with the
passage of time the export performance of RMG has been grown.in 2013-2014 year, the
money coming from export sector is 24491.88 $(USD) from the total money of
30186.62$(usd) which was the rate of 81.13 %of the total income of the country in export
sight. From the analysis we can simply understand how important RMG sector is in our export
sector. Here is a relevant data as a document of this rising sector :
year Export of
rmg(in
million
US$)
Total export of
Bangladesh(in
million US$)
% of RMG
to total
export
2011-12 19089.69 24287.66 78.60
2012-13 21515.73 27027.36 79.61
2013-14 24491.88 30186.62 81.13
Table 2:Export performance of Bangladesh(last three years)
Source: http://bgmea.com.bd/home/pages/TradeInformation#.VFIPT_Bepd1

16. 8
Figure 3:RMG export performance of total export
Source: http://textilelearner.blogspot.com/2014/07/rmg-leading-earning-sector-in-
bangladesh.html#ixzz3Hd759pCW
3.1.1 CONTRIBUTION TO ECONOMY:
 The sector contributes 38% of industrial value addition.
 It earns about 78% of total export earnings.
 It has approximately 4.5 million workforce of which women are the major individuals.
 Creates long cliental base for Banking, Insurance etc sectors.
 Provides indirect employment for 0.80 million workforces.
 Provides 0.2 millions job for waste recycle industry.
3.1.2 CONTRIBUTION TO GDP:
RMG has improved the economic sectors like agricultural, industry as well as GDP of
Bangladesh. More jobs have been created. More people have been employed .Here is a
graph showing the GDP improvement of Bangladesh:
Figure-4:GDP contribution for lastfiveyears
Source: http://www.slideshare.net/ShahriarRawshon/contribution-of-rmg-sector-in-economic-
growth-of-bd?related=2

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3.1.3 REASONS BEHIND SUCCESS:
 Price Competitiveness
 Flexible Labor Market Laws and Regulations
 Easy access to skilled labor force
 Lower labor and production cost
 Strong & Expanding Backward Linkage especially in Cotton items
 90% of domestic supply meet total fabric requirement and 75% of the total yarn
Requirement
3.1.4 Opportunities:
The garments business can be developed by ensuring proper use of the following
opportunities.
i) Rising demand and usages of national garments products in fashion industry.
ii) Development of sectors like retail that offers great requirements of garments products.
iii) Developing of domestic sector.
iv) E-commerce and Internet are emerged as promissory distributions channels to market and
sell the garments products.
3.1.5 Future prospect:
The garments industry in Bangladesh has grown in an unplanned manner and a critical
demand-supply gap has arisen for both yarn and fabric. The crisis will naturally deepen
unless appropriate backward linkages, the incorporation of the fundamental steps in the
textile industry all through to the RMG industry, can be built to meet the rapidly approaching
challenges in the global textile market. As the population is growing and the standard of living
is increasing in Bangladesh, the demand for textiles is increasing rapidly.
Dramatically increase capacities in spinning, weaving, knitting, and dyeing, printing, and
finishing sub-sectors. This will require the adoption of the most modern and appropriate
technology to ensure quality products at competitive prices.
3.1.6 RMG vs other sector:
RMG is far way ahead than other sectors. A pie chart shows the proof :

18. 10
Figure 5:RMG vs other sectors contribution
Source: http://textilefashionstudy.tumblr.com/page/4
CHAPTER-4
4.1 Problems of RMG in Bangladesh:
There are some problems regardingour RMG sector like,
Infrastructure:
 Infrastructure is the largest issue that obstacles Bangladesh’s RMG industry.
 The transportation problem, road congestion, gas scarcity, sea-port inefficiencies
create hurdle for RMG industry.
 Government has planned to expand the Dhaka-Chittagong Highway and doubled the
train container capacity
Raw materials:
 The dependency on imports are considered as major risks.
 High price in raw materials and rapid fluctuation in the price level.
 The lack of efficiencies and risk takers may hinder this approach.

19. 11
Economic and political instability:
 Corruption is the main hurdle in BD.
 High interest rates is an obstacle to invest in RMG sector.
 Political unrest and strikes are the highest risks in sourcing from Bangladesh.
 Governmental intervention may cause political instability
Low wage:
 Low wage lessens the productivity of the worker.
 Workers are focusing to work more on the overseas country. As a result we are losing
skilled worker.
CHAPTER-5
5.1 RECOMMENDATION:
Some advices for improving our RMG sectors are:
5.1.0 Enhancing workforce:
workers must be trained in order to get better result.
5.1.1 Economic and political stability:
Economic and political stability must be brought for the success of RMG industry.
5.1.2 Infrastructure and Communication Development:
Infrastructure and communication should be developed. Because of it not only handicraft
industry but also other small industries are getting affected. If the communication system can
be developed then the products of rural handicrafts can reach cities and go beyond our
country.
5.1.3 Improvement of product quality:
High quality but affordable products must be produced in order to rule overseas and national
market .
5.1.4 Online Marketing:
Now a days is all about digitalization. People are getting familiar with online .they are
spending much time on the virtual world. So online marketing has become a weapon for the
businessman’s. they are selling and displaying their products in online. Again people are
taking it as a buying source. Now days people want to buy from online stores. So handicraft
products must be marketed online. Because by online marketing products get maximum
promotion. And so people will trend to buy this things. Again by online marketing we can

20. 12
display this kind of products to outside world also. Many leading brands tend to find products
online. Thus our handicraft products can get international value.
CHAPTER-6
Conclusion:
In our country the readymade garments area unit primarily regulated by non-technical
persons having little technical data and there is no involvement of textile Engineers (thus
development and quality product is kind of impossible). The employees are primarily unskilled
ladies and youngsters who can develop this sector as a good earning sector to contribute to
our economic system by developing manpower ability. Finally it ought to be useful introduce
our tradition or culture to the world. Efforts area unit a foot through shut collaboration of public
and personal sectors toward product promotion diversification and export selling. However,
there is still the necessity for intensification of efforts at the degree of production and selling
as well as style innovation and adaptation. Our exporters of handicrafts ought to bear in mind
that while creation of export market may be a lot of challenging one obsessed on regular
provides, quality assurance and last however not the smallest amount fulfillment’s of the
patron check and preferences.
References:
1) Kotler P. & Armstrong G. (2006), Principles of marketing, Prentice-Hall of India, New Delhi.
2)Nickels, J.M. McHugh & S.M. McHugh (1986), Understanding Business, (9th ed.), Chap – 9,
Productions & Operations Management. New York: McGraw-Hill Co.
3)Nickels, J.M. McHugh & S.M. McHugh (1986), Understanding Business, (9th ed.), Chap – 11,
Human Resource Management. New York: McGraw-Hill Co.
4) Vietnam-a-close-competitor-to-bangladesh-rmg (2013,October 13):The Daily Star. Retrieved from
http://archive.thedailystar.net/beta2/news/vietnam-a-close-competitor-to-bangladesh-rmg/
5) http://www.fairbd.net/Details.php?Id=524,Retrieved-28/10/2014
6) http://ww2.unhabitat.org/habrdd/conditions/socentasia/banglade.htm,Retrived-28/10/2014
7) http://bgmea.com.bd/home/pages/TradeInformation#.VFIPT_Bepd1,Retrieved-29/10/2014
8) http://textilelearner.blogspot.com/2014/07/rmg-leading-earning-sector-in-
bangladesh.html#ixzz3Hd759pCW,Retrived-29/10/2014
9)
http://www.slideshare.net/ShahriarRawshon/contribution-of-rmg-sector-in-economic-growth-of-
bd?related=2
10) http://textilefashionstudy.tumblr.com/page/4,Retrieved -29/10/2014