Amid industry upheaval, Bangladesh is a safe pair of hands
High streets around the world are changing rapidly. The coronavirus pandemic has led to a great many store closures and seen more and more businesses shift online in our major export markets. These changes look like they will be permanent, as it is simply more profitable for brands to avoid the costly outlay of paying rent on physical stores. In fact, in future, there is talk that major brands may have just a few "flagship" stories as a showcase for their products—with the rest of their business going online.
There are major implications here for garment manufacturers. More than ever, production hubs need to adapt and evolve to remain relevant for brands and to be able to service their ever-changing requirements.
Bangladesh must not be a passive bystander, like a rabbit caught in the headlights, amid this shifting environment. We must embrace the changes which are taking place, and with this in mind, I offer five suggestions on how the Bangladeshi RMG sector can improve its offering to brands.
Number one is speed. As indicated, brands are wanting shorter runs, but they want them faster. This focus on rapid changeovers is a particular hallmark of the online fashion market, where the emphasis is on the continued updating of styles and lines. For evidence, one only needs to visit the website of an online business such as Asos, where the sheer wealth and breadth of offering and the way things are updated at such a rapid rate is something to behold. Consider also, here, Boohoo. This British business now produces a lot of its clothing in the UK, to be closer to market and provide it with speed and agility. This is what we are competing with in Bangladesh, therefore, everyone along the value chain need to be on board, whether that be logistics, infrastructure, factory layout and so on.
Number two is safety. One of the strengths of Bangladesh's RMG industry is that it is now acknowledged as among the safest in the world after the work of the Bangladesh Accord and US-based Alliance in improving factory safety. As an industry we can still use this as a selling tool with our brand partners. Just recently we saw a factory disaster in Morocco, and we continue to see other incidents in sourcing hubs such as India and Pakistan. Ours is an industry where health and safety was for far too long neglected. Thankfully, Bangladesh went through a massive investment process to make its factories safer for workers. This is a continuous process of improvement but, at the present time, we can say with confidence that ours is the safest major garment manufacturing country in the world. That's a huge sell to brands.
The third sell for brands is recycling and circularity. It was announced recently that dozens of RMG factories in Bangladesh will take part in a new circular fashion partnership, a cross-sectorial project led by Global Fashion Agenda, with partners Reverse Resources, BGMEA and P4G.
We need more initiatives like this. Recycling and circularity is the future for our industry. Brands love it and will always want to be involved in projects which promote the circular economy. Often it is difficult for brands to find the right industrial partners for this kind of work, so Bangladesh needs to make itself a one-stop-shop—a place where brands can go to establish turnkey solutions to meet their circularity objectives.
The above brings us onto point number four which is sustainable production. Let us not wait for brands to nudge and push us on sustainability issues. Instead, why can't we take the lead ourselves as individual factory owners and as an industry collectively? We must stop seeing sustainability as a "cost" and a headache and instead start seeing it as a prerequisite for doing business with large, blue chip retail brands. That is the stark commercial reality we are facing right now, in common with our competitors. We can all complain about the costs of investment (which I know can be onerous) but these issues are not going to go away. As an industry, we all have to bite the bullet and make the necessary investments in factory and technological upgrading, in renewable energy and so on. The "return" on this investment will be the continued business of brands in a world where issues such as carbon emissions are becoming more and more prominent in purchasing decisions.
The final selling tool for brands I would propose right now is Bangladesh as a safe pair of hands. Who would have thought one might ever be able to say that about Bangladesh and its RMG sector? In fact, we have had a very stable period in the years since Rana Plaza, which was such a huge wake up call for all of us.
Industrial relations are not perfect, but they are far less volatile than in other competitor garment hubs. We have not had the "forced/prison" labour issues witnessed in China during the past 12 months (which the US has responded to by placing sanctions on products facing Chinese cotton). We do not have the political upheaval we are seeing in Myanmar and, to a lesser extent, Ethiopia. In fact, of all the sourcing hubs, I would say Bangladesh has been the most stable over the past five years (with the exception of the unforeseen event of Covid-19, a pandemic which has impacted us all in different ways).
In short, brands know what they are getting when they come to Bangladesh: good quality goods and highly competitive prices, working with knowledgeable, seasoned manufacturers. In an uncertain world and these unprecedented times in which we are living, it's impossible to put a price on this kind of stability and familiarity.
Mostafiz Uddin is the Managing Director of Denim Expert Limited. He is also the Founder and CEO of Bangladesh Apparel Exchange (BAE).