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Bangladesh - Strategic Opportunities & Planning for the Future Date: 24 th Nov’ 12 Venue: Lake Shore Hotel ICTA 2012.

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Presentation on theme: "Bangladesh - Strategic Opportunities & Planning for the Future Date: 24 th Nov’ 12 Venue: Lake Shore Hotel ICTA 2012."— Presentation transcript:

1 Bangladesh - Strategic Opportunities & Planning for the Future Date: 24 th Nov’ 12 Venue: Lake Shore Hotel ICTA 2012

2 John T. Smith Comp TI, CText, FTI, CMC, MIMC. International Coordinator / Long Term Adviser Textiles and RMG UNIDO – BEST & Chairman, International Events The Textile Institute

3 Textiles and Clothing accounted for 87.9% for export in 2011/12 EU demand for Bangladeshi textiles and clothing surged by 28.6% in 2011 The EU was also Bangladesh’s largest market for woven clothing Source: McKinsey Report Where Are We Now?

4 Source: McKinsey Report Where Are We Now?

5 Source: McKinsey Report Where Are We Now?

6 Implication of McKinsey

7 SWOT Analysis STRENGTH -EPZ’s -Back to Back L/C -Plentiful Population -Modern Equipment -Dynamic Entrepreneurs - Financial Model WEAKNESS -Infrastructure : Electricity, Gas, Roads, Rail, Ports -Slow Reaction -Product Development -Technical Management -Literacy - Lack of integrated thought OPPORTUNITY -Broaden Categories of Products -Move Up market -Introduce more linkages -Cooperation Partners -Introduce non-woven -Introduce fibre production - Change Philosophies THREATS -Worker Unrest -Uncompetitive Practices - outdated administration Competitive International Factors

8 THE WAY FORWARD

9 What the BEST Program Does? Clustering - Groups of People/ Companies with Similar Interests Competitive HRD -Survey Done -Expand on Knowledge

10 What the BEST Program Does? Clustering - Groups of People/ Companies with Similar Interests Competitive HRD -Survey Done -Expand on Knowledge

11 New Opportunities for Textiles & Garment Entrepreneurs

12

13 Primary Textiles -New Processes e.g. Backward/ Forward linkages e.g. Spinning/ Weaving Specialties/ Specialist Fabric Finishing New Opportunities…

14 Primary Textiles - Backward/ Forward linkages - New processes - Value raw material for its positive properties - Use international research results - New Fibre use e.g. Bamboo - New Fabric finishing New Opportunities…

15 Garments - More effective production -More CAD/ CAM -More Design Groups -More Fast Response /ERP -More Integrated Product Design -More Mix & Match New Opportunities…

16 -Comprehensive Integrated Manufacture! -Use Critical Path Analysis -Product friendliness (change easy parameters) -Many products from few inputs (raw materials) New Opportunities…

17 Literate Educated Workforce Design & Build Eco-Friendly Economic Factories New Opportunities…

18 New Buying Markets Source: McKinsey Report

19 Major Issues Infrastructure Compliance Supplier Performance Raw Materials Economy & Political Stability Source: McKinsey Report Challenges for Growth

20 Source: McKinsey Report The Next Sourcing Hot Spot

21 Goldman Sachs includes Bangladesh in the Next 11 (N-11) J P Morgan – ‘Frontier Five’ stating that major advantages of Bangladesh is ‘ Price & Capacity’ Labour cost expected to rise by 30% The Next Sourcing Hot Spot

22 Efficiency Increase to Match Wage Increase

23 RMG Factories in Different Countries Bangladesh Indonesia2450 Vietnam2000 Cambodia260

24 Shift from ‘Knitwear’ to ‘Woven’ expected Upgrade Service Level e.g. Design, Package, Ticketing, Warehousing, Delivery Expected Trends

25 Government Supplies ( Garment Makers) Buyers ‘The story of Bangladesh has just begun’ – Head of Sourcing Office ‘ Battle for Capacity is on the Horizon ’ Expected Trends

26 China dominated in 2010 Source: McKinsey Report Expected Trends

27 CPO Forecasts 32% will decrease sourcing from China 54% plan to decrease their sourcing from China i.e. 86% are reducing Wages in Coastal China increasing rapidly Shortage of Garment Workers in the area China will eventually be a net importer – not exporter!!

28 With thanks to : -The McKinsey Report - Textiles Intelligence Reports 145 & UNIDO BEST BWTG Reports Sources

29 Thank You For Your Attention


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