Internal rivalry among entrepreneurs is ruining Bangladesh’s textile industry. Common price policy is required to solve this problem emphasized by Mohammed Shahinul Haque, ED of Badsha Group.
Mohammed Shahinul Haque, Executive Director, Badsha Group
Mohammed Shahinul Haque is a visionary textile engineer with an extensive experience who has been serving the textile sector for the last two decades. After completing his B.Sc. in textile engineering from College of Textile Engineering & Technology (currently Bangladesh University of Textiles) in 1995, he started a career in Beximco, which was the pioneer in spinning and textile industry at that time, and served the organization for seven years.
Later on, he joined in NR group and after that, he joined in Badasha Group of industries and working for last sixteen years. He is now leading the group as Executive Director. Badasha Group is one of the highest capacity holding companies in Bangladesh in spinning and denim manufacturing.
Shahinul Haque has gathered in-depth knowledge in the textile industry set up including spinning, weaving, dyeing-finishing and machinery installation etc.
He implemented his knowledge to set up a new industry, operation, product development, production planning, sales, and marketing as well. He is one of the prominent experts in the country in modern machinery selection and erection to make a new project financially feasible. Along with all these professional strengths, Shahinul Haque has special expertise in denim mill set up, from machine selection to fabric production. He designed and established the Pioneer Denim Limited, a sister concern of Badsha Group.
Recently Industry Research Team of Textile Today has met him to explore his professional experiences and Badsha Group’s business operations. He has been selected as the ‘Textile Icon’ of July 2018 issue of Textile Today.
Textile Today: What initiative should we take to develop efficient people in this sector?
Mohammed Shahinul Haque: There is no alternative than training to convert our population into assets. We need to arrange training to increase the efficiency of our local people. Training can be provided by foreign experts or combined with local experts.
We also can arrange training for local trainers by foreign experts by a certain period so that our local trainee can become an expert trainer and train up other people.
Foreign tours also can be a good way of training. People can visit some industry in other countries and learn more knowledge practically. Training by the manufacturer of the machinery company also can help us to make technically sound.
Such training help in how to operate the machines and achieve the highest efficiency by using existing facilities in order to reduce manufacturing cost.
Institutional training also can be a good way of training. BUTEX or other educational institution can conduct some training courses for our fresh or experienced people.
Textile Today: How Government should act to support our Textile industry?
Mohammed Shahinul Haque: Government is an important stakeholder of this sector. They should fix some policy for booming this business. Policies need to be taken in utility cost reduction, continuous supply of gas and electricity and infrastructure development etc. The government should subsidize in the power and energy sector. Utility price should not increase for the next 10 years at least to minimize the production cost.
In the industry, the price of finished products is not increasing where the material cost is upward. If utility cost also increases in parallel, the local manufacturer cannot compete and as a result, they need to sell the goods at manufacturing cost or lower than that to continue the running of manufacturing wheel. It is a question of survival for the industry. The sector will not survive if utility cost increases in every year.
Textile Today: What opportunities are waiting for Bangladesh textile industry?
Mohammed Shahinul Haque: Bangladesh has a good opportunity for the textile business. Our backward linkage is now stronger than before. Our spinning mills are meeting up 90% of local consumption for knit and 40% for woven. Our textile mills are providing a major portion of the required fabric for our own apparel export, which we had to import earlier, and now we are exporting fabric to other countries as well.
Our main competitor China is closing their business in this trade. 40 denim mills have already shut down and will reduce 50% of the industry in next two years due to labor cost rise and environmental issues. If we could fix some policy, we could grab this opportunity and will be the main player in the textile business.
Our internal negative competition is harming this industry. When one factory set up a large capacity of product then they need to sell the fabric for continue production and reduce the price. Then customer is taking this advantage to other supplier. Clients claim then, if factory ‘A’ can provide with this price why you cannot. Then factory ‘B’ is bound to reduce price. We need to overcome this price barrier and need a common price setting strategy.
Textile Today: What challenges do we need to confront to grab this opportunity?
Mohammed Shahinul Haque: Our main challenge is product diversification. We are producing the same category of products by almost every manufacturer. For example, Bangladesh has 400 spinning mills and almost every spinning mill is producing same cotton or cotton blend yarn. There is no special yarn producing by our spinners. 150+40D ACR (Air covering yarn) yarn is used for super stretch denim fabric, which, is not available in Bangladesh. Some entrepreneur should think about it to start working on it to set up spinning mills for such type of special product.
We have become our own competitor in the product category. This is damaging to our business. Buyers are taking this opportunity. They have many options to choose from and then they are playing with a price. We are getting very low margin, which is the main struggle for our business.
Shortage of technical knowledge is one of our primary weakness. Our entrepreneurs should have enough technical knowledge and information. If they can foresee, what trend is coming next, it’ll give them an edge on planning their next business expansion.
Due to lack of proper information, business is not diversified and expanding in the same category. Investment in diversified product group can bring more success for this trade.
Textile Today: What techniques should an entrepreneur adopt for getting a better price?
Mohammed Shahinul Haque: Our entrepreneur should establish a common price policy. Our internal negative competition is harming this industry. When one factory set up a large capacity of the product then they need to sell the fabric for continue production and reduce the price. The customer is taking this advantage to other suppliers. Clients then claim if factory ‘A’ can provide with this price why you cannot. Then factory ‘B’ is bound to reduce the price. We need to overcome this price barrier and need a common price setting strategy.
Textile Today: What are the Badsha group’s current business operations?
Mohammed Shahinul Haque: Badsha Group is a three-decade experienced textile conglomerate. Its business operation started in 1978 with raw cotton and yarn trading. The main business operation started in 2000 by establishing Pioneer Sweaters Limited in international business.
Later on, it has expanded business in yarn manufacturing and established two spinning named Badsha Textiles Ltd. and Kamal Yarn Ltd. The latest addition in Badsha group is Pioneer Denim Ltd, a modern mill of denim fabric manufacturing.
Textile Today: What is the production capacity of Pioneer Denim Ltd and what are the major technologies using there?
Mohammed Shahinul Haque: Our manufacturing facility is 1.4 million sq. ft. and yearly production capacity is about 40 million yards. For this huge production, we have high tech German machinery, and these are highly productive and efficient.
ETP is a most vital thing in denim production and we are aware of that. Pioneer Denim Ltd. has 6000 per day capacity of ETP considering the environmental issues. We have a plan of expansion of the production capacity more 40 million yards by 2019.
Textile Today: What are the Badsha Group’s next expansions?
Mohammed Shahinul Haque: Pioneer Denim fashion Ltd. bottom factory will start in 2019 having 50 lines and will be extended in more 50 lines soon. We have established washing factory for denim washing. We also have 3000 Shima Seiki auto machine in sweater project and plan to expand more in sweater business.
For textile business expansion, our other project of fashion denim and super stretch or bi-stretch denim is under construction. It will help for import reduction and save our lead time.