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Barriers in productivity and efficiency growth in Bangladesh’s apparel industry

Productivity and efficiency are the heart cores of the apparel industry in the sense of business growth and sustainable position in this era of a competitive market. At the beginning of the apparel industry revolution in Bangladesh, productivity percentage was really flexible and relaxed.

Figure 1: Lack of productivity and efficiency are the main barriers of the Bangladesh RMG.

Business owners did not focus on workers’ efficiency and labor productivity as labor cost was very low and the Cost of Manufacturing (CM) value was high.

However, with Industry 4.0 at super speed, competitive markets increased, the value of CM and FOB decreased. In this circumstance, brands and retailers are now very much mindful about what CM, wastage percentage calculating by apparel suppliers at the same time, some brands keep solid angle eye on factory overhead cost.

In this highly competitive capitalist world, brands and retailers comprehensively calculate all costs associated to produce a garment by garment factories before placing their order to a readymade garment (RMG) for the best price bargain.

Where the Bangladeshi apparel industry with around 40% worker productivity fallen far behind, though neighboring RMG manufacturing countries have progressed tremendously.

So, how to get around these decade long obstacles and fallen behind mind-set? What can be done to keep sustainable business profits margin, productivity and efficiency?

Case studies show that some barriers are more reason to pick the highest productivity and reach a sustainable position in the respect of the efficiency with the standard benchmark.

Most of the apparel factory’s efficiency is level hopelessly below average 45%. In three ways these barriers are hindering:

  1. Lack of strategic decision
  2. Non-productive time
  3. Supply chain issues-which are the main constraints to repose sustain productivity and efficiency.

And studies also show that around 10-15% efficiency are apparel industries losing overall. Then what’s the reason of this sluggish inefficiency.

Let us dig up the solutions of these obstacles. Percentage (%) of responsibilities to pick the productivity and efficiency (overall 10-15% losing).

  • Lack of strategic decision-20%
  • Non-productive time (NPT)-45%
  • Supply chain issues-35%

Lack of strategic decision:

Automation: Automated machines have to be increased for loading and unloading materials from vehicles, internal material handling, cutting, sewing and finishing otherwise difficult to reduce man-machine ratio (MMR), time-saving and cost-minimizing. The automated machine increases productivity by 7-10% less than non-automated machines.

Figure 2: Automated machines have to be increased to stay competitive in this fast world.

Efficient planning: Planning makes optimum utilization of all available resources. It helps to reduce the wastage of valuable resources and avoids duplication.

Planning aims to give the highest return at the lowest possible cost. Thus increases the overall efficiency. Efficient planning works to reduces business-related risks, facilitates proper coordination, aids in organizing, gives the right direction, keeps good control.

Training and research: Only cheap labor will not be the competitive trump card in the future. Along with cheap labor; efficiency and productivity need to be optimized. Mid-level management training also compulsory to eradicate the communication gap and to ensure the flow of directions from top management to lower level.

Lack of workers’ positive mentality-research shows that 10-15% of workers want to pass the days with simple efficiency. These workers do not bother about efficiency. With proper motivation and training and other convenient tools can be used to pick up their productivity level.

Lack of eye power and resource utilization:

  • Analytical analysis of power
  • Resource utilization
  • Right person selections for the right position

Ensuring these three pillars are vital to keep alive and run an organization perfectly.

Management should not only focus on garments production because analytical analysis, resource utilization and right person are the crucial backbones of productivity and efficiency.

Migration and absenteeism: A skilled workforce is one of the fundamental requirements for efficiency and productivity growth. A large number of migration (approx. above 3-4%) and absenteeism (approx. above 4-5%) impacts mainly on productivity and production floor set up at the beginning hour.

Apparel factories have scope to mitigate these impacts by incentives and motivational schemes.

Non-productive time (NPT) and Defects per Hundred Units (DHU): The number of goods an apparel factory is producing with better quality can be judged by DHU%. To sustain DHU% should be less than 2-3%, as it is considered as DHU% the benchmark.

If any RMG factory produces more than DHU-5% means that factory losing 15% productivity, because 3 times need to do the same job (where body collecting, problem finding, seam opening and disposal-total double-time needs to complete that garments and again stitching).

Machine breakdown: From a non-productive time report can be easily seen that how many available minutes are losing. Spare machines, guides and folders should be available in case of machine breakdown to replace instantly and running the production flow.

Style changed time: During style change, keeping note of how much time each style is taking to complete the layout is vital, cause if more time is taken than allowed feeding time, then this excess minutes or time is considered as wastage and it is a mammoth productivity barrier.

Unskilled operator and lack of supervisory: How much capacity losing from each operator who are not skilled. This miss out capacity considered as lose earning minutes. Production Supervisors keep the main impact to pick the highest productivity. It is a foremost concern to judge supervisors’ skills.

Fabrics quality: Ensuring fabrics quality is vital. Different types of fabric difficulties are considered as non-productivity and inefficiency like-shading, GSM Low, width uneven, spots and holes.

Figure 3: Ensuring fabrics quality is vital.

Supply chain issues

Import dependency (most for raw materials), lack of backward linkage, defect in supplied materials, relationship problems with suppliers, inconsistency in utility supply, fabrics supply, trims and accessories supply, lead time distribution and lack of time and action alliance–all these are major barriers of the supply chain.

Figure 4: The supply chain is considered as the main driver for the industry to keep a sustainable position.

Efficiency affected ration is 35% in the respect of how much efficiency loss for the supply chain. Besides efficiency increasing the supply chain helps to reduce operating cost-production cost, purchases cost, total supply chain cost and improves financial position-increases profit leverage, decreases fixed assets and increases cash flow.

The supply chain is considered as the main driver for the industry to keep a sustainable position.

In the respect of productivity and efficiency barriers above gestures should be governance strongly by top management then these factories will gain sustainable positions and globally can be distinguished with the workmanship.

If anyone has any feedback or input regarding the published news, please contact: info@textiletoday.com.bd

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