Darkness coming in Bangladesh RMG sector! Can we sustain after 10 years?

Bulbul Ahmed

Strategic Transformation Leader | ERP, IT & Enterprise Solution Project Manager | Master Business Analyst | Management Consultant | Driving Innovation Through Process Optimization, Culture Development, and Automation Technology | 22 November, 2018 (Thursday)View 3090

Bangladesh is the 2nd largest ready-made-garment (RMG) exporter in the world. But this scenario will not be the same after 10 years. We don’t have the right things in place to keep the second place.

Bangladesh is among the 11 high potential economies

Bangladesh is one of the Next-11 high potential and largest economies in the world in 21st century. The Next-11 comes just after the G7 and BRICS Countries.

Next-11 countries are Bangladesh, Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, the Philippines, Turkey, South Korea and Vietnam. Next-11 countries have an area of 10 million sq. kilometers while having a population of 1460 million. Combined nominal GDP of these countries is 6.5 trillion dollars. In terms of purchasing power parity (PPP), their GDP reached 15.5 trillion dollars.

Bangladesh has grown very big in RMG Sector

  • Bangladesh is the 2nd Largest RMG Exporter in the World
  • Bangladesh exported 36.67 Billion USD in 2017-18, where 83.5% is from RMG sector (Source: BGMEA)

Bangladesh offers the lowest cost structure

The reasons why Customers prefer Bangladeshi Manufacturer are

  • Low Labor Cost
  • Low Social Benefits
  • Low Electricity Cost
  • Low Water Cost
  • Duty Free Access to Europe, China, Canada, Japan, Australia etc.

Bangladesh has grown a lot in the past decades in RMG sector just because of low cost. But the cost structure is changing. Any person who is working in Costing for years will know that the costs are increasing and profits are decreasing.

Low cost is not enough to sustain – Darkness is coming

Darkness coming in 10 Years!

As the cost is increasing in Bangladesh, the other countries will match with us very soon. We will not be able to beat them by lower cost any more in 10 years. There will be other factors come into play besides cost…

  • Quality
  • On-time delivery
  • Customer service

Unfortunately, Bangladesh is in the Stone Age in terms of the above. If we continue like this, many RMG industries will collapse into Darkness. Already a lot of RMG industries cannot provide the salary on-time because their cost is increasing. This is very alarming.

Securing the future – starting with the people

In order to compete with the other countries, we need to improve Quality, Delivery Time and Customer Service. In order to achieve this, we need efficient and productive people. This is the big lacking of Bangladesh RMG sector comparing with the other Next-11 countries.

We must build a body of knowledge within the people who are working in the industries.

This platform 360 Business Analyst is created to share the practical knowledge with the industry professionals, not just the theoretical knowledge. The knowledge from this platform will guide people how to improve the organization they are working on. It will show them how to start and where to start.


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