Mayeesha Mahmud foresees incremental investment in smart technology to streamline processes
Cotton Group, a value-driven organization, always aspires to empower communities of creators, customers and partners by crafting products of utmost quality while mitigating environmental footprints along the entire value chain from the very beginning of the 90’s.
Mayeesha Mahmud is a Director at Cotton Group’s garment division, a fully-integrated ready-made garment (RMG) manufacturing hub that focuses on the whole value chain process from yarn to ready-to-wear. She brings in a wealth of experience having worked as a tax consultant at PwC Canada as well as in real estate accounting and advisory. She graduated with Honors from McMaster University in Canada with an Economics and Finance degree. She further graduated from Imperial College London with a Master of Science degree in Management with distinction, specializing in accounting and strategy.
Recently, Mayeesha Mahmud shared her journey into the garment industry, her thoughts on the recent global crisis, secret sauce of their growth etc. in an interview with Textile Today.
Textile Today: Could you please share with us your journey into the apparel sector?
Mayeesha Mahmud: Cotton Group was founded by my father Shaheen Mahmud. As of right now, Cotton Group is a fully integrated manufacturing hub in Bangladesh with a knitting capacity of 18 tons and dyeing capacity of 22 tons per day. As for our global client base, we have a wide array of customers in North America, South America, Europe, Asia and Australia.
In my life’s journey into the sector, I have been living vicariously through my father. I have grown up witnessing his vigor, passion, and hard work to create what you see of today’s Cotton Group. Having said that, as a second generation I found passion in the garment industry due to its impact in the overall economy at the micro as well as macro-economic level, which includes but is not limited to job creation, infrastructure development, immense opportunity for horizontal and vertical industry growth. Most importantly, our apparel industry has uplifted Bangladesh as an impactful sourcing destination in the global fashion industry. So, my passion derives from this patriotic view – where the RMG industry is the socio-economic driving force of our country.
Textile Today: We see, 2nd and 3rd generations are now entering into the industry and running the businesses. What is crucial for the young generations in Bangladesh to become an entrepreneur in the textile and apparel sector?
Mayeesha Mahmud: As for the challenges, first of all, there is a big difference between knowledge gained from academia – be it from home or abroad – and applying it in the industry. Curating strategies to bridge that gap will allow a young entrepreneur to acclimate efficiently. Understanding how relationships are built and sustained with all stakeholders involved is an integral part of this industry which includes our workers, employees, suppliers, customers, bankers, transportation systems, government as well as any horizontal and vertical industries or bodies that assist us in fueling the RMG sector.
Whether you work in Bangladesh or abroad, there are some psychological factors to consider as well as an entrepreneur entering the family business: social, developmental, cognitive, industrial organization and evolutionary; and it is absolutely vital in streamlining this process of adoption with the support of your family as well as co-workers.
In your family business, you will continuously keep learning from your bubble, however working for others outside your eco-system gives you the opportunity to be mentored and taught from a fresh perspective. That is why in the initial stage of my career I gained experienced in different realms. However, this best practice may not be applicable for everyone.
Most important strategy I will say on mitigating the challenges is to increase the knowledge and information sharing among the young entrepreneurs. Here, I want to give BAYLA a big credit – as the platform has given us an immense opportunity for communicating with other young entrepreneurs and share the highs, the lows, the challenges. Plus, I will say that BAYLA has enabled a wonderful social aspect where people have been able to make new friends beyond the work. So, it is a wonderful hub with an excellent leadership team.
Textile Today: What are the key challenges you would like to address? Where do you want to focus?
Mayeesha Mahmud: If you asked me this question two years ago, my answer would have been completely different. The COVID-19 pandemic has shaken the whole world and it has changed everybody’s vision and strategy. The challenge we have right now and also in the near future is the utility crisis which is drastically impacting the RMG industry. Secondly, the devaluation of Taka against USD is introducing more volatility. We will directly benefit from urgent policy support in these areas which for example could be through enhanced export incentives.
Despite the ongoing pandemic, we have achieved a significant amount of growth in the apparel sector. Our exports went up, the number of textile and apparel factories went up, and a vast number of factories went for expansion. Meaning we have to cater to that increased capacity. But if the industry does not get the required amount of gas and electricity support along with orders, then we will face a systematic breakdown.
The crisis is not only limited to the apparel factories, but the vertical and horizontal industries and institutions like banks, transportation, suppliers, etc. – all are going to be affected and will collapse if this is not resolved immediately. I want to thank our BGMEA members and the government for their support thus far, as they are effortlessly trying to resolve this.
Second critical issue I want to highlight is that we are facing a challenge regarding the ethical buying practice by brands and retailers. We are getting historically low price offers in recent times. Sadly, this is supplemented by the widespread undercutting practice. Although, the undercutting practice was present previously, its scale has gone up drastically since 2020. What I believe is that, if your company’s strategy and competitive advantage allows you to offer lower prices, then that is fair. But if you just undercut to take an order then it will systematically breakdown your value chain. You will collapse in the long run.
Although I empathize with them as we all are trying to keep our head above water – but let’s just not make it a permanent practice. I also empathize with brands and retailers as without low price offers, they won’t be able to give big volume orders – but this is not a long-term solution. So, both the buyers and manufacturers need to come to an arrangement which is fruitful for everyone involved.
And finally, the biggest challenge that is knocking on our door is the global recession forecasted within next year. Leading investment banks like Goldman Sachs, Morgan Stanley have predicted that within the second quarter of 2023, the US economy will enter into a recession, which will impact the global economy even further.
As our RMG industry brings around 85% of our export earnings, we must do a comprehensive study regarding the changing buying habits of end-consumers. Because during a recession, consumers will not splurge on fashion as cost of living will continue to rise into the next year even with efforts to curb inflation via interest rate hikes. Thus, as a major apparel manufacturing country, we must make smart demand forecasting a priority for 2023 to keep the industry afloat.
As an industry – along with BGMEA and the government – we must ride this difficult wave together.
Textile Today: How do you see the overall investments in the sector? In which segments do you find suitable for more investment?
Mayeesha Mahmud: In terms of industry investment, the challenging landscape which lies ahead makes new investment tough. But we have to make investments to continue the growth and livelihood of our people. What I think as the right way to proceed is to invest in smart technology, focusing on smart supply chain management systems – that includes smart demand forecasting, more supply chain transparency, implementing artificial intelligence in terms of sample making and showing, etc. We have to go halfway between physical and virtual reality to ease things, because this is the futuristic world, I see in RMG.
I am not saying that it needs to be done overnight, as technology implementation happens in intervals. Through gradual implementation – its impact in the long run will create positive externalities.
Textile Today: As sustainability is the core of any businesses – please share a brief on your sustainability initiatives? How can companies be more sustainable to tackle the present & future challenges?
Mayeesha Mahmud: Cotton Group follows the Triple Bottom Line (TBL) approach which has three pillars: People, Planet and Profit and we ensure that our goals align with the United Nations Sustainable Development Goals (SDG). Let me give you some examples, Cotton Group’s Effluent Treatment Plant (ETP) – from General Electric USA + Suez SA France – is one of the best in Bangladesh with 30 tons production capacity. This is a big leap towards sustainability and we knew making a deep investment here was essential for our environment and operations.
On a second note, Cotton Group has recently started giving scholarships to workers’ children. Enabling them to study– ensures our workers’ real growth. I think the cycle works like this, they are taking care of our RMG industry, and we have to take care of them.
We are also providing insurance policy coverage for our employees. It gives them ease in the back of their mind that if they are not well, or have health complexities, then the insurance is there to support them. At the end of the day, if the RMG industry is the backbone of Bangladesh then our RMG stakeholders are the backbone of this industry.
