German retailer to boost apparel purchase from Bangladesh

German retail giant Lidl will increase its garment purchase from Bangladesh by 20 percent in 2015 as the company thinks the country is still competitive for low prices.

In 2014, the company purchased 251 million pieces of apparel from Bangladesh, Markus Reinken, buying director of Lidl, said in an interview with The Daily Star in Narayanganj.

Currently, the company purchases garments worth $700-$800 million from Bangladesh a year, said a company official.

“Bangladesh is an important source for apparel items for Lidl and we purchase a substantial volume from here,” said Reinken.

He however declined to mention the percentage of the company's total purchase from Bangladesh. Lidl also sells non-apparel items in different countries.

“We will increase our purchase of garments from Bangladesh in the near future, as other sourcing countries have become expensive due to higher costs of production and a shortage of workers there.”

“We have long term plans for Bangladesh, as the country is improving in regards to compliance and diversification of fashion and technology uses in garment production,” Reinken added.

Compliance is not a problem for Bangladesh alone, it is a problem for other countries as well, he said.

Lidl prefers purchasing garment items from factories that not only make business but also invest in water saving and green technologies, he added.

“We will start a water-saving technology or WST next month in the factories from where Lidl purchases garment items in Bangladesh,” he said. The company will pay higher prices to buy the garment items, if any company invests in WST, he added.

WST will primarily be launched in 30 factories as those are currently capable of adopting the new technology; it will gradually be adopted in other factories as well, he said.

All the factories that Lidl sources garments from do not have the capacity to adopt WST, he said. “So, it will take time to introduce WST in its all client factories.”

Lidl aims to reduce water use by 50 percent. Currently in Bangladesh, 15 litres of water are required to produce a T-shirt. “Our target is to reduce this figure to 7 litres.”

Reinken visited Narayanganj-based Plummy Fashions Ltd to place work orders with the green factory.

“We support factories like Plummy. This could be the future. We need to go in the direction that Plummy has gone.”

Located in Narayanganj, 20 kilometres south of the capital, Plummy Fashions, a LEED Platinum certified company, began its production in March by employing 1200 workers.

Leadership in Energy and Environmental Design (LEED) certification is a rating system that reviews a factory's green initiatives, such as site development, energy and water conservation, material selection and indoor environmental conditions.

To receive LEED Platinum certification, a company must score 80 out of the available 110 points. “Plummy received 92 points from the US Green Building Council,” said Fazlul Hoque, managing director of Plummy Fashions.

The two-storey manufacturing unit is situated on a campus of 5.5 acres, 50 percent of which are open areas with lush greenery. Its six reservoirs will store around six lakh litres of rainwater and use it for washroom flushing.