The whole world has been suffering a lot from the COVID-19 pandemic. Every sector of the industry has been affected. The textile industry is the main remittance earning source for Bangladesh. This industry has been affected a lot due to lockdown everywhere and a shortage of orders. As everywhere vaccination has been started and the COVID-19 infection situation is better now. Fortunately, Bangladesh is receiving plenty of orders now. Team Denim Focus talked with industry stakeholders to know about their business in 2021 and furcating for 2022. Shah Rayeed Chowdhury, Director Evince Group shared his views-
As garment makers, although we see a light at the end of the tunnel; the tunnel itself is proving to be longer than anticipated; however, make no mistake, that we are foreseeing better days ahead. The initial phases of 2021 were undoubtedly challenging as buyers demanded orders to be placed at prices that were unreasonably low and in order to keep lines running, most of us have accepted their offers; thus, disrupting the price vs value structure of the entire sector – although there was little we could do at the time.
However, we are steadily addressing the low-cost factor by negotiating for higher prices during ongoing season-wise buying meetings. In the end, it all comes down to the basics – demand vs supply. The positive news is that customer demand is increasing globally for fashion wear, leading to an increase in orders for buyers; although, there is not enough capacity to execute the expected quantities.
On the flip side, the increase in raw material prices, including but not limited to the 64% increase in raw cotton prices, has raised the cost of production for both garments and textiles exponentially. Subsequently, the entire value chain has been negatively affected.
In addition, our industry as a whole is experiencing further pressure from having to make payments against the government stimulus package plan which has commenced. On one hand, prices are still low, on the other hand, we have to make the installment payments.
As mentioned earlier, even though there is pressure from all sides at the moment, we remain optimistic. The reason is, we can foresee the overall order situation improving steadily in Bangladesh. Lately, a number of new buyers have entered the market who were previously placing orders in markets like Africa, Burma, and Vietnam. Indicating that as production units close down in those countries, customers are shifting to Bangladesh. Moreover, due to trade wars between China and Europe, and the US – customers are even more focused on Bangladesh as the prime hub for sourcing. All in all, Bangladesh will continue to have an overflow of orders in the near future. Although there might be a concern of COVID cases spreading across Europe once again, we can still remain hopeful that the overall order situation will remain stable.