Professional Documents
Culture Documents
Assignment on
RMG
Submitted by
Name: Forid Ali
ID: 2221401015
Batch: 29
Department: FDT
Submitted to:
Teachers Name: MD. Sadikur Rahman
Designation: Senior lecturer
Department: FDT
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Table of Contents
1. Summary
2. Introduction
3. Body
4. Conclusion
5. Recommendation
6. Appendices
Summary
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1. Summary
SWOT Analysis on Readymade Garment Industry in Bangladesh
RMG is the leading industry in Bangladesh. It is basically a labor-intensive
industry and it needslimited financial investment and relatively simple
technology compared to other high technicalindustries. The success story of
Garment Industry in Bangladesh is the story as to how thereadymade
garments starting in the late seventies as an insignificant non-traditional item
ofexport. In 1998-99 this sector has earned 4019.98 million US$ through
exporting which is75.67% of the total export (Redwan, 1995).
The overall impact of the readymade garment export industry is certainly one
of the mostsignificant social end economic developments in contemporary
Bangladesh. The remarkableachievement of RMG sector is now exposed to
each and every country. Despite these impressiveachievements and the
probable challenges in the near future, if properly managed, the prospectsfor
further expansion and growth for this sector remain bright. There are some
major threats stillexits in this sector but Bangladesh Readymade Garment
(RMG) industry holds a key position in the economy of Bangladesh interms of
foreign exchange earning, employment generation and poverty alleviation.
Right nowRMG sector is the highest foreign currency earner in Bangladesh.
Apart from contributing tohuge foreign exchange earnings, RMG industry has
become the largest source of employmentgeneration. Around 2 million
people are presently involved of whom 90% are distressed womenin the
RMG industry of Bangladesh. In addition a rough estimate shows that the
sector throughlinkage effects is currently generating about US$ 2 billion
worth of domestic economic activities(Bhattacharya, 2000.
RMG industry is the most important sector for the economy of Bangladesh. It
accounts for75.14% in 2000-2001 of the country’s total export earnings
(BGMEA Newsletter, 2001) About1.5 million workers of whom 90% are
distressed women are engaged in about 3200 garmentfactories as on June
2000(BGMEA, 1997-98.
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2. Introduction
The garment industry has emerged as the dominant export earning sector in
Bangladesh during the last few decades. The industry has been expanded
since late 1970s [1]. The productivity from this sector has become higher
than the agriculture. At present about 4.2 million people is directly employed
and many others in forward linkage industry, backward linkage industry and
indirectly involved with garment industries in Bangladesh [2]. The rapid
expansion of the industrial development creates job opportunities as well as
promotes reducing poverty. It is also promotes growth to other industry like
banking, cosmetic industry, communication and transportation [3]. Thus the
economic growth of the Bangladesh was surprisingly steady and gradually
increasing in the last decade. With help of RMG sector from a bottomless
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basket Bangladesh has become a basket full of opportunity. Even during the
world recession period, the crisis affected Bangladesh very little. At present
Bangladesh is the second largest garment manufacturer and exporter
country in the world. Though having such steady progress garment industry
had to face crisis situation and questioned from buyers and internationals
community for sweatshops and violating basic labour rights. Bangladesh
earned enormous bad reputation after two worst industrial disasters Rana
Plaza Collapse (2013) followed by Tazreen Fashion fire in 2012 killing more
than thousands of workers [4]. And thus the issue of workplace safety and
sustainability comes to us as a burning issue. Workplace safety and
sustainability is a hotly discussed and challenging issue in the era of
globalization. Safety can be termed as the state of being “safe” (from French
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3. Body
2. LITERATURE REVIEW
The rapid growth of the economy that came along with RMG is also brought
enormous social change in terms of reduction of illiteracy rate, diminishing
child marriage, women empowerment, reduction in malnutrition, reduction
in newborn death, increasing life-expectancy. Girls those were burden to
their family earlier has now become hope for families [8]. The country has
now become a role model for rapid development [3]. Currently, the textile
industry provide 83.49% of national exports. This proportion is even higher in
Bangladesh. In Bangladesh, the number of employed workers in the textile
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industry increased 4.2 million in 2018 and the number of enterprises 4560
[9]. Although the garment industries have become the backbone of the
country's economy, it also possesses threats recently. Despite having the
outstanding success in the RMG sector, the following broad factors like lack
of safe.
of them were Tzaneen Fashion Fire in 2012 followed by Rana Plaza collapse
in 2013 [15]. It is observed that those two out of three RMG accidents caused
by fire. Though Rana Plza collapse was the last wake up call for us still
improvements required.
3. METHODOLOGY
Source of data Both primary and secondary sources of data have been used.
Primary data has been collected through interview and questionnaire
methods. Secondary data has been collected from different relevant
publications, dissertations, books, journals, newspaper articles and reports,
government publications, rules, acts, websites etc.
There were two groups of respondent for this fieldwork. There was a
structured questionnaire consisting close ended questions. First group
consists of 450 worker of which 225 from compliance factory and 225 from
average compliant one. Remaining 50 Respondents includes General
Managers, Managers, Executives, Academic Scholar, Buyers Representative
and government officials.
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4.1 Frequency of Emergency Exit Kept Open This is the first basic rules of
safety. In most of the hazard emergency exit were kept blocked. Among the
respondent from compliant factory 222 respondent answered that.
building etc. For Data analysis data collected from both questionnaire and
interview are combined. A mixed (qualitative and quantitative) method is
followed to analyze the data. Here we discussed the safety issues in part-A
and SWOT analysis discussed in part-B.
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International Journal of Scientific and Engineering Research Volume 10, Issue 11,
November 2019 ISSN 2229-5518
Regular fire drill is another major safety measure. This time respondents
were asked regarding frequency of fire drill in their factories as per their
experience. From best compliance factory 208 says experience its monthly,
13 experience it every two moth interval, 4 of them Bi-annually, and nobody
says they have seen it never. Though, fire drill is supposed to be arranged
every six month by government circular. On the other hand in non-
compliance one 180 experience it monthly, 26 every two moth interval, 9 Bi-
annually, and rest 10 says they have seen it never. And top management 35
person answer it doing in every month, 7 persons answer in every two
months, 5 persons answer biannually and 3 said never seen.
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Access and availability to PPE is another major safety concern. This time
respondents were asked regarding access and availability to PPE in their
factories. Where respondents from best compliance projects 95.5% says that
they are easily accessible, of them 0.9% says not easily accessible, 3.5% says
sometimes accessible. On the other hand respondents from average
compliance projects 79.5% says that they are easily accessible, of them 8%
says not easily . accessible, 12.5% says sometimes accessible.
Respondents were asked regarding biggest Threat for RMG sector here in
Bangladesh. Whereby there response was 37% respond for political unrest,
20% for competitors, 30% price diminishing, 13%says its environment
pollution and rest 4% others. Other factors included lack of friendly
government policy, raw material price hike day by day, labour unrest and
capability to hold the market for long term future.
Established market linkages by the small directly exporting segment who also
have garment manufacturing units in Chennai and Bangalore
Easy assess to necessary inputs and related enterprises
Established product reputation of input (Yarn dyed fabric)
Ability to offer low volume customized products.
Weaving/ Weavers
Related Enterprises
WEAKNESS
High cost of inputs (dyes and chemicals), power, blocked working capitals
and hence high interest cost affecting cost competitiveness.
Inadequate (Direct) market linkages with buying houses, buyers agents etc.,
Inadequate information on fashion trends requiring the enterprises to remain
dependent on exploitative middlemen.
Scope for skill up gradation of labour on garment manufacturing front.
High levels of fluctuation in input prices.
Weaving/ Weavers
Related Enterprises
OPPORTUNITIES
Scope for move toward garment infrastructure and value added production
Scope for effectively exploiting markets with phase out quota regime
effectively
Networking with buying houses and import promotion agencies abroad.
Scope for capitalizing on Salem reputatio
Weavers
Related Enterprises
Scope to start up buying houses for which entrepreneur in other cities are
looking for.
THREATS
To enhance competition from other cities in India and also from other
countries.
Introduction of non- tariff buyers by importing nations
Weavers
export 27.02 billion USD. Though the country could not achieve the
last year target, this time also the country want to chase a big target.
But the year has been started with a great uplift at its first month.
Bangladesh exported textile and clothing (T&C) products worth of
2696.4 million USD in the month of July, 13 which was 2538.8 million
USD previous month and 2311.2 million USD in the same month of the
previous year. In fact, exports of the country's clothing products
witnessed a robust growth of more than 26 percent in July 2013, amid
clothing manufacturers' apprehension that their shipment orders might
fall following the tragic Rana Plaza incidents and the image crisis that
all were talking about of late aroused from the USA GSP issues [7,8].
Material and Method
4. Conclusion
prime facts[23]. Besides Exploring New Market, Stable Political Condition,
Developing own Brands, producing high value products ,environmental
safety, developing common audit platform, and producing raw materials
(different fibers) Chemicals and machinery locally etc [24]. According to the
response of the respondent Political Unrest, competitors, Price diminishing,
Environment Pollution and lack of friendly Govt. Policy, Raw material price
hike day by day, labour unrest are the main threat for RMG industry[6].
Political parties should not take any harmful and destructive steps which will
causes a great lose to the common interest of people such as strike[12].
From this study it is found that product price same style from different
vendors from Buyers end is depends on the factory safety practices. Byers
prefer placing high FOB orders in those projects investing safety. So safety
invest is a win-win investment. And effects of safety factors are remarkable
on sustainability. Implementing adequate workplace safety culture and
providing union facility is a must for upcoming days.
0% of our respondents enjoy the duty- free market access and 20% of the
respondentgroup enjoys GSP facilities only if local fabrics are used. 60% of
the respondent group collectsorder through the buying house (local buying
agent) and the rest gets offer directly through thehead office situated
abroad. They have no problem in collecting orders due to better quality
andlow price. The respondent group believes that they have been able to
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5. Recommendation
Moreover, some steps will be taken to shorten the "lead time” for expo
rt of readymade garmentsby means of development of port management,
simplification of goods unloading, resolving theelectricity problem and
similar activities. Furthermore, assistance will be given to improve thework
environment in the readymade garments factories, to reduce risks of accident
and to fulfillthe compliance requirements at the factory level. Besides, an
integrated and reasonablecompliance regulation will be prepared with the help
of all stakeholder
Since, our RMG sector is facing huge competition in the world market as
because of abolition ofquota system we have to go very carefully to capture
the world-wide market. As a result, wehave to take some necessary steps
which will be taken to send marketing missions abroad, toorganize single
country textiles and readymade garments fairs, to organize and participate
ininternational trade fairs at home and abroad so as to expand and integrate
the markets forreadymade garments. At the end we can say that our RMG
sector is doing well what is more than our expectation. Andif this flow goes
on this way then we will be successful and our RMG sector will be a great
threatfor other competitors in the world market. Based on the above data
analysis and findings wesuggest the following strategies that RMG should
follow
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has been spent on training of staff with skills that are transferable across
the industry. Betterskilled staff will increase the productivity of the company
as well as increase in GDP. This factorof investment in its workforce is often
neglected by enterprises, which have been hampered byshort term planning.
Integration
Due to the lack of development networks among the players involved in the
Bangladesh industryand their respective markets, there is little integration
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Elimination of child-labor
The Bangladeshi industries employ many children and the garment sector is
not different fromthem. It is a matter of industrial reputation that will go down
if they recruit child labors.Recruiting child labor may also bring negative
impression on the brand image of the company toits customers.
Improvement of Quality
Quality is one of the important factors that make the customer loyal to the
product. Therespondent group believes that the quality of the product is a
factor that affects the sales. Theyalso believe that the volume of their business
depends on the quality, design and the commitmentas the fashion and style
changes too often. Therefore, the companies have to respond according
to their customers‟ test.
They have all the latest equipment to serve their customer.
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6. Appendices
Annual Reports:
1. BGMEA‟s Annual Report, 2006
-20072. Ministry of Commerce Bangladesh Export Policy, 2006- 2009, p. 5.3.
Ministry of Finance Bangladesh Economic Review, 2003, p. 74.
Web sites:
1. Asian market data, analysis and forecasts from Business Monitor
International, the trustedsource for business information and intelligence on
global emerging markets; September
29,2008http://findarticles.com/p/articles/mi_qa5508/is_200106/ai_n21474192
/2. BGMEA lobbying for backward linkage industry; Retrieved September 29,
2008http://findarticles.com/p/articles/mi_qa5508/is_200106/ai_n21474192/3.
Crabbe, The Textile and Garment Industry Sector of Bangladesh.Retrieved
May 14, 2008 fromhttp://www.cleanclothes.org/publications/unst9.htm4.
Green, Duncan Fashion Victims: Together we can clean up the Clothes Trade:
Web site
Industry in Bangladesh. 2017, BGMEA. [4] DePillis, L., Two years ago, 1,129
people died in a Bangladesh factory collapse. The problems still haven’t been
fixed., in Washington Post. . 2015. [5] Kuhlman, T. and J. Farrington, What is
Sustainability? Sustainability Journal, 2010. 2(11): p. 3436-3448. [6] Köksal,
D., J. Strähle, and M. Müller, Social Sustainability in Apparel Supply Chains—
The Role of the Sourcing Intermediary in a Developing Country.
Sustainability, 2018. 10(4): p. 1039. [7] Jia, F., et al., Sustainable supply chain
management in developing countries: An analysis of the literature. Journal of
Cleaner Production, 2018. 189: p. 263-278. [8] Rahman, D.M.H. and S.A.
Siddiqui, RMG: Prospect of Contribution in Economy of Bangladesh.