Where next for our industry beyond Covid-19? | The Daily Star
12:00 AM, July 06, 2020 / LAST MODIFIED: 12:00 AM, July 06, 2020

Where next for our industry beyond Covid-19?

Three months after most of the major global markets of Bangladeshi garments entered a lockdown period and closed many of their shops, we are beginning to get a better picture of how the industry might look as we move beyond Covid-19. 

The most obvious thing to state right now is that it does not look like we will return to business as usual any time soon. In fact, it is looking more and more like we will all be operating in a very different environment once the dust settles.

Among our customers—brands and retailers—a few trends have become obvious. The first is that there has been an obvious move towards online sales during lockdown. Online clothing sales have rocketed for the likes of H&M and Inditex. Both these major retailers say they expect large swathes of this shift towards digital to be permanent.

Another, arguably more significant trend, is the industry talk of moving towards a more sustainable industry. There is a renewed push towards slower fashion and the discussion about the environmental problems associated with fast fashion have once again been reignited.

On social media, the hashtag #BounceBackBetter has been trending for several weeks. Influential bodies in our industry have been saying that now is the time for the industry to change and that Covid-19 has brought forward many conversations which should have been happening anyway. We are producing too much clothing and we have to slow down.

These are reasonable points, although there are social issues for Bangladesh here which cannot be ignored.

What does all this mean for Bangladesh ready-made garment factories? The short message is that only the strong will survive. We have all spent the past few months licking our wounds as orders have dried up and customers have failed to pay their bills. That's unfortunate but there is no changing it now; we are all in the same boat so we just have to roll up our sleeves and get on with it.

What is important is what we do collectively as an industry. There are a number of changes I see. Firstly, I think we may see a move towards lower minimum order quantities (MOQs). Our customer base is shifting, becoming increasingly seamless and responding faster than ever to the demands of their own customers—the public. As suppliers, we have to be ready to respond—to be more nimble, agile and flexible in our offerings. The ability to respond rapidly to demands for small, niche lines could be vital in the new landscape.

Secondly, I see a move towards even shorter lead times. Pressure on our RMG sector is already immense but, in future, it will more than ever be a buyer's market. Things are not going to get easier beyond Covid-19. A rationalisation of the industry at our end is inevitable, and suppliers will have to respond accordingly. Those who survive in the new landscape will be the cream of the crop.

Thirdly, as consumers re-assess their priorities in the post-Covid-19 world, it's likely that elements of discretionary spending will be challenged. As more companies realised their staff can work from home, less people will go to office. Hence, there will be less dressing up. People are not attending events now and therefore there will also be less appetite for new clothes. When the less is more, there will be high demand for better products, demand for the clothes long last with more sustainable footprints. We were already seeing pressure on suppliers to adopt more sustainable technologies prior to Covid-19 and now I expect we will see a speeding up of this process. Just last week, we saw the rapidly growing online brand, Zalando, announcing that it was adopting Science Based Targets. Where do most of Zalando's carbon emissions come from? Of course, it is in supply chains. When brands say they want to reduce their emissions, it has huge implications for us as suppliers. They can't do it without our support.

Fourthly, though lockdown in the western cities are gradually being relaxed, the protective lifestyle will not go away very soon as the risk of reinfection of the virus will always loom large. Hence, personal protective products will take a permanent and prime place in the shelves of shops. So, factories should include these types of protective apparel in their product categories. There is no doubt that the apparel manufacturers who will experiment and explore diversified PPE production will have more opportunities in the post-Covid-19 world.

Fifthly, manufacturers must change the ways they used to think. The pandemic has proved "remote working" is realistic. That means a garment factory in Gazipur or Naranyanganj can easily hire a designer, brand marketer or sales manager in Paris or Barcelona, pay only a freelance rate and start to build a direct business. Technology during this pandemic showed that no one has a monopoly to communicate. This means that many people in the middle will become obsolete. A small factory with almost no investment overseas can reach out and engage with a brand in Europe, USA or Japan, and use technology to build and earn trust. This was previously thought impossible. It was thought that one had to have a big budget to physically be present to build a reputation or earn trust in overseas markets.

Sixthly, the pandemic has shown that physical location is irrelevant, more relevant are skills and expertise. So, garment factories will need to invest in soft skills such as in design thinking, marketing, branding, etc. Apart from the hard skills of producing good garments, they will need even more people who can communicate as who communicates best will win in the race of business now.

Seventhly, the next few months will be very tough for our sector and factories will close. Workers will lose their jobs. We must all support one another in these most challenging of times. More difficult than ever will be forecast volumes because consumers' behaviours will be unpredictable in the rest of this year and even in the next. So, brands and retailers together with suppliers need to find smart ideas on how to further decrease lead times with calculated risk. Therefore, to survive and to be successful it's essential to have close cooperation and partnership between the buyers and manufacturers. Problems need to be solved together and successes should be shared together. Only then it will be possible to be powerful and flexible.

Finally, what will emerge in 2021 will almost certainly be a more compacted industry. We may all have to revise our growth plans, if we are being realistic. But who knows—maybe it will also be an industry in which sustainability is truly embedded into operations rather than just be an afterthought. Covid-19 has brought the worst of times to our industry but, believe it or not, there are more important things in life than this dreadful disease—most notably, the future of our planet.

 

Mostafiz Uddin is the Managing Director of Denim Expert Limited. He is also the Founder and CEO of Bangladesh Denim Expo and Bangladesh Apparel Exchange (BAE). Email: mostafiz@denimexpert.com

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