Bangladesh has gradually turned into a major manufacturing hub for winter jackets as work orders are mainly shifting away from China due to higher production costs and a shortage of skilled workers in the country.
Winter jackets are a relatively new export sector as local apparel makers have been diversifying their products with this type of value-added garment item in recent years.
Bangladesh’s apparel shipments have grown even amid times of global economic uncertainty for two reasons, namely the shift of work orders from China and the increased export of value-added garments.
For instance, nearly 50 local apparel exporters are currently producing winter jackets that are priced between $30 and $50. This was unheard of even five years ago as the country’s exports were mainly confined to basic t-shirts, woven shirts and trousers at the time.
Other than China, work orders for high-end winter jackets are also shifting from Vietnam, India, Myanmar, Taiwan, South Korea and Japan, according to industry people.
In addition, the winter jackets made in Bangladesh are even being sent to some Scandinavian countries in Europe as well as Russia, the US and Canada.
“We have increased our sourcing of value-added winter jackets from some local factories as they have already improved their production capacity and offer competitive prices,” said an official of a major European retailer in Dhaka on condition of anonymity.
SM Khaled, managing director of Snowtex, a leading jacket exporter, said his company has been bagging a lot of work orders from international retailers and brands.
Snowtex currently has the capacity to export between $25 million and $30 million worth of jackets each month, he added.
Similarly, Abdullah Hil Rakib, managing director of TEAM Group, a leading outerwear exporter, said his company ships winter jackets worth $10 every month.
Winter jackets are the latest addition to TEAM Group’s export basket with bulk shipments even reaching some Scandinavian countries, Taiwan, the US and Russia. The company’s exports were previously limited to woven and other knitted garment items.
Bakhtiar Uddin Ahmed, chief operating officer of Fakir Apparels Limited, said local manufacturers are getting a good response from global retailers and brands as they can supply winter jackets at competitive prices.
Considering this heighted demand, the company set up a new jacket manufacturing unit in Narayanganj four years ago. With this added capacity, Fakir apparels can ship 1.50 lakh jackets abroad each month.
The price of these jackets is comparatively higher than other garment items as buyers usually pay between $30 and $50 per piece, he added.
Faruque Hassan, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said local garment exporters get almost half of what their Vietnamese counterparts make from garment exports due to various reasons.
This means international buyers will pay $5 for a t-shirt made in Vietnam but the same product would get $2.5 if made in Bangladesh.
One of the main reasons behind the lower pricing for Bangladeshi garment items is the production of basic items.
However, recent hikes in the production of high-end value-added garments is reducing this gap as global buyers are paying better prices for such products, Hassan added.
The BGMEA chief went on to say that local garment makers aim to earn better prices by supplying value-added items.
Bangladesh’s export earnings from apparel shipments has changed a lot in recent times as the income is now mainly value driven instead of volume based as many local exporters are producing high-end products.
This is a major reason for the country’s positive growth in garment exports even under difficult global economic circumstances.
Garment shipments grew 10.12 per cent year-on-year in the January-February period of the ongoing fiscal to reach $8.36 billion, as per data from the Export Promotion Bureau.
News Source: The Daily Star