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Bangladesh garment industry has a great scope to diversify product basket

Mohammad Abdur Rouf is a customer-centered result-driven vibrant leader with 18+ years of experience in overall business operations of large scale fast-fashion chain retail, garments and accessories manufacturing, FnB operations and service operator business operations management from the top.

He is leading the Dekko Accessories Ltd and Agami Accessories Ltd. accessories concerns of Dekko Legacy Group from March 2017 as Executive Director, who was former Chief Operating Officer (COO) at Aarong (March 2009 – March 2017).

Abdur-Rouf-Dekko-Accessories-Bangladesh-garment-scope-diversify
Figure 1: Mohammad Abdur Rouf, Executive Director, Dekko Accessories Ltd and Agami Accessories Ltd.

Recently he shared his views and thoughts with Textile Today on techniques, strategies and goals that should be followed by an RMG leader during this crisis time.

Textile Today: What roles can RMG leaders play during the time of the COVID-19 crisis?

Abdur Rouf: Globally when the COVID-19 pandemic broke out, the industries which took the hardest hits among them readymade garment (RMG) manufacturing sector was one of the top industries to get hurt badly by this Coronavirus.

Bangladesh’s two main RMG export destinations are the US and Europe, which were hit hurt by COVID-19 pandemic. Naturally, a huge amount of apparel orders were on hold or canceled by the buyers which tremendously impacted the Bangladesh RMG industry.

In light of this scenario in any business organization in the crisis moments, leadership plays a critical role and leads from the front and other employees follow the leader.

Textile Today: What techniques and goals should an RMG leader follow and what strategies can RMG leaders implement during this crisis time?

Abdur Rouf: As an RMG leader should think comprehensively and look into the future to devise comprehensive plans to survive and sustain in this business. Bangladesh’s textile and apparel manufacturing industry needs this sort of visionary leader right this moment.

As for strategies, a leader should devise 2 types of strategies:

  1. Short term strategy
  2. Long term strategy

In short term strategy, a leader has to identify some scenarios to deal with immediate challenges. These strategies should be based on studies and actual facts.

As for long term strategy, RMG leaders should talk to their leading buyers – as they have a global market analysis team, the global team making forecasts and trends analysis – to make the right long term strategy. It should not be on any emotional basis and sticking to old plans and products.

“Most of the factories in Bangladesh are running with 5-10% fat such as low performing staff, over staff, production wastage, rejected products, additional price of RM, inefficient maintenance operations etc. By identifying those fat areas and taking corrective action the factory can keep on running without any unnecessary fat.”

Abdur Rouf, ED, Dekko Accessories Ltd

To mitigate the impact of this crisis, we have to make at least six months’ prior plan. If a factory previously made apparel products for A category buyer, then a leader should also contact and talk to B and C or D category buyers to onboard the buyers to get orders.

Lower category buyers will also come as he will see that an A category garment is giving products at lower category prices. It is safer and reliable to work with that complied garment rather than going to a Chinese non-complained cheap garment factory. Thus getting more orders can make up for the orders it has lost.

As for techniques, survival comes first. Setting the survival strategy is paramount. A lot of apparel factories goes for manpower cut as the primary solution for survival. But an exemplary leader should watch the global scenario unfolding, and as I said earlier, talk to his buyers to project consumer consumption trends and plan accordingly.

Mohammad-Abdur-Roup-Bangladesh-apparel-scope-diversify-product
Figure 2: As one of the largest garment accessories manufacturers in Bangladesh, Dekko Accessories Ltd. offers very prompt and quality service to the buyers for the product categories

And as for the idle manpower in this COVID-19 pandemic, a leader has to utilize in other areas instead of going for new recruits. It has other positive implications as well – as we lack skilled manpower – like making the workforce multi-dimensional.

At the same time, calculating essential factory costs and maintenance compare to the business he will make in 6-12 months, and see his/her capacity – how much factory capacity is sitting idle. Same way, pinpointing other excess cost leakages and remove it to save up cost.

And down the line, if it saves 5-10% annually, which is a lot. Most of the factories in Bangladesh are running with 5-10% fat such as low performing staff, over staff, production wastage, rejected products, the additional price of RM, inefficient maintenance operations, etc. By identifying those fat areas and taking corrective action the factory can keep on running without any unnecessary fat.

Textile Today: What is Dekko’s plans in this period? What strategies has Dekko taken to overcome the crisis?

Abdur Rouf: We kept our factories closed for one month. Afterward, our factory has been quite busy as we are getting enough orders. One of the big reason is that previously a big portion of garment accessories was supplied by China. Now a lot of buyers are shifting from China and placing orders locally to ensure fast and secure support from nearby sources.

As one of the largest garment accessories manufacturers in Bangladesh, Dekko Accessories Ltd. and Agami Accessories Ltd. produce products for almost all the big buyers and supplying to a good number of factories in Bangladesh. And in this disrupted and uncertain times, we are offering very prompt and quality service to the buyers for the product categories that they used to get from overseas sources. We are treating this crisis period as an opportunity to enhance capability and win the heart of overseas dependent buyers.

Textile Today: What new opportunities you are seeing for the textile and apparel industry in this negative situation?

Abdur Rouf: As at present big buyers like H&M, M&S, PVH, TESCO, Inditex, Best Seller and many more have reopened and placing orders, so apparel factories are running again —with reduced capacity as the order quantity is small.

To compete with high-end garment manufacturing countries like China, Vietnam and Turkey, we have to invest in R&D and innovation to develop new products’ option to show the buyers about our capability that “we are as capable & equipped as China, Turkey and Vietnam,” We should be more aggressive on branding and marketing now to attract new customers. Cutting costs in promotion and R&D right this moment will not be a good decision.

But global leading market analysis and predictions are showing that apparel consumption will shrink at least by 30-40% in the coming years. In this scenario, for the next one to two years’ people will be focusing on buying essential goods instead of apparel. Moreover, tourist purchases throughout the world will be reduced significantly since traveling and mobility of humans is going to limited for a year or two. That is why in the long run we will see a decline of 30 to 40% in apparel orders.

At the same time, due to the COVID-19 pandemic, the world is witnessing a huge increase in functional wearables (medical textiles) such as protective masks, PPE, gloves, etc. Over the years, the Bangladesh textile and apparel industry has been focused mostly on making basic apparel products. Also, our export destinations have not been diversified well enough.

Dekko-R&D-LAB
Figure 3: To compete with high-end garment manufacturing countries like China, Vietnam and Turkey, invest in R&D and innovation to develop new products’ is paramount.

Bangladesh garment manufacturing industry has a great scope to diversify product basket, expanding export destinations, and grab some of the portions of manufacturing which has been projected to shift from China.

Textile Today: We are seeing that Bangladeshi garment manufacturers are cutting costs in R&D and marketing. Also, online platforms are gaining more popularity in this pandemic. What strategies should be implemented in the post-COVID-19 period?

Abdur Rouf: To compete with high-end garment manufacturing countries like China, Vietnam and Turkey, we have to invest in R&D and innovation to develop new products’ option to show the buyers about our capability that “we are as capable & equipped as China, Turkey and Vietnam,” We should be more aggressive on branding and marketing now to attract new customers. Cutting costs in promotion and R&D right this moment will not be a good decision.

As for integrating with online platforms (B2B), it is high time to do so, like engaging with Alibaba, Amazon and other leading online platforms to seek more business opportunities. Also, BGMEA is looking to launch its own platform to be connected with the consumers directly.

Textile Today: We see a lot of industries globally struggling to maintain safety standards to keep their employees safe from getting COVID-19 infected. In light of this, kindly share with us how Dekko is maintaining the safety standard of its employees.

Abdur Rouf: In the beginning, we have worked with reduced capacity to ensure social distancing in the factory. After the holiday if any worker came from the village we said to stay home for a couple of days to see his/her physical condition. If the worker felt well after a couple of days only then he/she can join the factory. We have been maintaining detailed information of every single employee and their families. If anyone of any employee’s family member gets COVID symptoms, we immediately discontinue the duty of the respective employee. We further let that employee join upon confirmation of recovery of her/his family member by our own doctor’s panel. This is how other workers remained safe. In addition, we have ensured that Dekko Group’s doctors are always in communication with the workers to get medical advice at any given time.

Washing hands before entering the factory are mandatory for each and every employee. Dekko monitors the body temperature of every worker. Also, we have kept hand sanitizers and handwashing points in different accessible places in the factory so that workers can wash their hands at regular intervals. Still by any chance, if anyone feels sick in the factory, we give leave him/her, so that he/she can go home and rest for a couple of days.

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