• Tuesday, Sep 27, 2022
  • Last Update : 09:24 am

Apparel industry may lose opportunity to turn its losses around

  • Published at 02:05 pm July 27th, 2021
RMG apparel industry
Apparel industry insiders fear that they will lose buyers if the factories remain closed Syed Zakir Hossain/Dhaka Tribune

Although there is a stricter lockdown in Bangladesh, major export destinations of the apparel sector, including the United States and Europe, have returned to normalcy and the business is up and running

The apparel industry of Bangladesh may lose its opportunity to turn its loss around due to the 19-day long closure of their factories because of the Eid holidays and the lockdown, industry insiders fear. 

Although there is a stricter lockdown in Bangladesh, major export destinations of the apparel sector, including the United States and Europe, have returned to normalcy and the business is up and running, said industry insiders.

They also said that there has been a surge in sales in buyer countries since their return to normalcy. Moreover, there is a shortage of products in the stores of many reputed brands.

As a result, the brands are all looking for quick shipments of products. Apparel sector entrepreneurs are fearful of losing 10-15% of their purchase orders due to the stricter lockdown, they added.

Also Read - Government rejects calls to reopen factories

The RMG factories did not have to close at any stage of the lockdowns since the outbreak of Covid-19 in March the last year. 

But this time, the manufacturers of the RMG industry are worried about not being able to ship their exported goods on time during “peak season” as the factories have to be closed due to the worsening Covid-19 situation in Bangladesh.

“June, July and August are the peak times for apparel exports. We export 35%-40% of the total export of a year during this time, which is worth $12-14 billion,” said Shahidullah Azim, vice-president of the BGMEA. 

He also said that orders for the Christmas holidays and winter seasons are now in the shipment stage. “Since these are seasonal clothes, the brands will not be able to sell these if we can not ship these timely.”

They urged the government to allow the opening of apparel factories from August 1, four days before the end of the lockdown period, he added.

Meanwhile, Home Minister Asaduzzaman Khan Kamal said on Tuesday that the factories will not be opened before August 5. The government has no plans to relax the restrictions amid the request of the businesses.

While asked about this, Shahidullah Azim said that they have nothing to do outside the government's decision to control the Covid-19 infection cases.

“As the infection rate is rising, there is nothing to do about opening the factory units now. We hoped that the infection rate would reduce, but now the reverse is happening. As all the factories are closed, we will abide by the decision of the government,” he added.

According to the manufacturers, Bangladesh is getting a lot of orders for the garments of the next winter, summer and spring seasons. Many companies have already received bookings for March of next year in line with their factory production capacity. 

RMG industries had just started to gain recovery from losses. Bangladesh exported $34 billion before the pandemic and later, it was reduced to $6 billion.

Meanwhile, the sector has recovered 3 billion, marked $31.45 billion — fetching a 12.55% growth in the last fiscal year (FY). But the export situation may be affected due to the closure.

In this regard, Mostafiz Uddin, managing director of Chattogram based Denim Expert Limited, said that they have to abide by the governmental decision. 

However, they will appeal to allow the opening of apparel factories again if the government extends the lockdown after August 5.

“We will lose a number of buyers since the factories of competitor countries are open and, in this case, if we do not ship the products in time, our reputation will be ruined,” he added.

“Already shipments are being delayed due to container congestion at the Chattogram port, closure of factories could lead to more disasters,” he added. 

Also Read - Why RMG factories were kept open during lockdown

A number of exporters said that they have orders in the supply chain of the factories that are nearly 90% done. Shipments of those products would have been possible only by finishing and packaging. 

They also appealed to complete the work with a small number of workers if the lockdown was prolonged.

Workers in dark

Meanwhile, the apparel workers are worried about their salary, since the factory is closed till August 5.

They fear that they may get paid less than their usual salaries as the law allows owners to pay 50% to employees of their regular wages if factories are closed due to an unprecedented incident, such as a pandemic-led lockdown.

Babul Akhtar, chairman of Bangladesh Garment and Industrial Workers Federation (BGIWF) said that the owners have closed the factory on the instructions of the government. So, if they want to pay less for this excuse, it will be disappointing and can create instability.

“However, even if the factories are closed till August 5, it will not affect the wages as the Eid holiday was till July 28/30. We hope there should not be any problem with the wages of the workers,” he added.

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