Post Graduate Diploma on Knitwear Industry Management (PGD-KIM)

KIM104: Business Operation Skills

SWOT analysis of Apparel Industry of Bangladesh

(Assignment)

Submitted to:

Muhammad Mahbub Alam

Submitted by:

Sakhawat Hossen

ID- 22281006

Executive Development Centre (EDC)

BRAC Institute of Governance and Development (BIGD)

Brac University
 Introduction:
The journey of the RMG sector dates back to 1960, along with the Reaz store in Dhaka. Later
in 1973, they changed the store name to Reaz Garments Ltd.

In 1978, for the first time, Reaz Garments started expanding the apparel industry in
Bangladesh by exporting 10,000 pieces of shirts in Paris for 13 million francs.

And since the 21st century, the readymade garments sector has been leading the country’s
Gross Domestic Products, Exports and thus economy and also helping to increase Per Capita
Income and thus to decrease poverty rate simultaneously.

To face the upcoming challenges in the readymade garment industry, Bangladeshi garment
owners must have a strategic vision. To tackle a crisis, one has to get to the bottom of the
problem. So, in this case, we are analyzing the situation using SWOT analysis. We will
discuss our strengths, weaknesses, opportunities and threats.

Strength:
I. Availability of skilled labor at lower cost.

II. Energy at comparatively lower price.

III. Some of our companies have already made a good impression in the global market.

IV. Ability to produce high quality product at lower price.

V. Getting duty free custom bonded warehouse.

VI. Growing domestic market.

VII. Support from government by incentives and other ways.

VIII. Duty free access in the worlds some largest market like EU, USA.

IX. Availability of energy and other relative materials at relatively low cost.

X. Several associations like BGMEA, BKMEA, and BEPZA etc. to build the tight

collaboration with various connected organizations.

1) Less labor cost [22]
2) Energy at relatively lesser price
3) Freely accessible infrastructure like railway, sea, river
and air route.
4) Has a great number of pre-export financing
organizations for guidance.
5) Reasonably open economy, particularly in the Export
Processing Zone.
6) Several associations like BGMEA, BKMEA, and
BEPZA etc. to build the tight collaboration with various
connected organizations [17].
7) Duty free access to some of the largest market of the
world like EU, USA.
8) Thinness of currency opposed to dollar/euro, helping
exporters to earn subtle profit.
9) Convince of duty free custom bonded warehouses.
1) Less labor cost [22]
2) Energy at relatively lesser price
3) Freely accessible infrastructure like railway, sea, river
and air route.
4) Has a great number of pre-export financing
organizations for guidance.
5) Reasonably open economy, particularly in the Export
Processing Zone.
6) Several associations like BGMEA, BKMEA, and
BEPZA etc. to build the tight collaboration with various
connected organizations [17].
7) Duty free access to some of the largest market of the
world like EU, USA.
8) Thinness of currency opposed to dollar/euro, helping
exporters to earn subtle profit.
9) Convince of duty free custom bonded warehouses.
1) Less labor cost [22]
2) Energy at relatively lesser price
3) Freely accessible infrastructure like railway, sea, river
and air route.
4) Has a great number of pre-export financing
organizations for guidance.
5) Reasonably open economy, particularly in the Export
Processing Zone.
6) Several associations like BGMEA, BKMEA, and
BEPZA etc. to build the tight collaboration with various
connected organizations [17].
7) Duty free access to some of the largest market of the
world like EU, USA.
8) Thinness of currency opposed to dollar/euro, helping
exporters to earn subtle profit.
9) Convince of duty free custom bonded warehouses.
1) Less labor cost [22]
2) Energy at relatively lesser price
 3) Freely accessible infrastructure like railway, sea, river
and air route.
4) Has a great number of pre-export financing
organizations for guidance.
5) Reasonably open economy, particularly in the Export
Processing Zone.
6) Several associations like BGMEA, BKMEA, and
BEPZA etc. to build the tight collaboration with various
connected organizations [17].
7) Duty free access to some of the largest market of the
world like EU, USA.
8) Thinness of currency opposed to dollar/euro, helping
exporters to earn subtle profit.
9) Convince of duty free custom bonded warehouses.
1) Less labor cost [22]
2) Energy at relatively lesser price
3) Freely accessible infrastructure like railway, sea, river
and air route.
4) Has a great number of pre-export financing
organizations for guidance.
5) Reasonably open economy, particularly in the Export
Processing Zone.
6) Several associations like BGMEA, BKMEA, and
BEPZA etc. to build the tight collaboration with various
connected organizations [17].
7) Duty free access to some of the largest market of the
world like EU, USA.
8) Thinness of currency opposed to dollar/euro, helping
exporters to earn subtle profit.
9) Convince of duty free custom bonded warehouses.
Weakness:

I. Lack of diversification of products and export destinations.

II. Energy Crisis.

III. Political Instability.

IV. Weak Infrastructure.

V. Longer Lead Time.

VI. Unsafe work environment.

VII. Lack of skilled worker and lack of training facilities for worker, supervisors and

managers also.

VIII. Dependence on imports for raw materials.

 IX. Lack of marketing strategy.

X. Incompetent ports, time consuming custom clearance.

1) Longer lead time.

2) Lack of marketing tactics
3) Weak infrastructure
4) Lack of sea port capacity
5) Political instability
6) Small number of manufacturing methods
7) Petty number of product variety
8) Lack of training organizations for industrial workers,
supervisors and managers
9) Autocratic approach of nearly all the investors
10) Absence of easily on-hand middle management
11) Fewer process unit of textile and garments
12) Speed money culture
13) Time consuming custom clearance.
14) Subject to natural climate.
15) Incomplete port, entry / exit complicated and loading /
unloading takes much time
16) Communication gap created by the lack of English
knowledge
Opportunities:
I. Willingness of foreign investors to establish industries in Bangladesh.

II. US Commitment of enhance export trade.

III. Huge unskilled manpower, can be skilled up through training.

IV. Development of communication infrastructure.

V. Development of Transportation facilities.

VI. Technological Advancement.

VII. Chattogram port going to give much faster service, which will be decreased lead time.

VIII. Increasing labor cost of others competitors countries compare to Bangladesh.

IX. Export opportunity in Japan and others markets.

X. Entrepreneurial minded young people.

entrepreneurial minded people1) The EU is willing to establish industries in a big way as

an option for China particularly for knits, including
sweaters.
2) Bangladesh is included in the least developed countries
 with which the US is committed to enhance export trade.
3) If a skilled technician is available to instruct, prearrange
garments is an option because labor and energy cost is
inexpensive.
4) Chittagong port is going to be handed over foreign
operators, which will make the port service faster.
5) Bangladesh is gaining its political stab

Threats:
I. Price rise of raw materials.

II. Political unrest situation in the country.

III. Environmental pollution is a threat for survival.

IV. Lack of electricity.

V. Demand falls due to global crisis.

VI. Increased competition in global markets.

VII. Unstructured Government policies.

VIII. Poor Infrastructural facilities like (communication, energy supply & transportation).

IX. Dependency on foreign managers.

X. Lack of R&D and Innovation.

Recommendations:
Moreover, we should take some steps to overcome our treats and weaknesses and achieve our

opportunities and Some steps should be taken to strengthen our strengths:-

 Reduce lead time.

 Resolving the electricity problem.

 Go for Joint Venture

 Improving Managerial Capacity of our local Manager.

 Improving working environment.

 Product Diversifying.
  Quality improvement.

 Improve R&D and Innovation.

Now, how can we do these things?

Firstly, we can reduce lead time by developing our port management, road transportation,

loading-unloading simplification in port.

Electricity problem is worldwide now. We can reduce this problem by maximize use of

renewable energy.

We need more training facilities and more work-oriented study curriculum in our educational

institutions and factories to improve the capabilities of the existing management and

workforce and the next generation.

We are in right track by building more Green Factories, but we also need to improve our

mentality and positive mind for improving work environment.

Future growth requires more linkages between our industry and academia, more focus on

R&D to do better and stay ahead of others.