The major objective of this internship report is to analysis Export performance of readymade garments sector of Bangladesh. Other purposes are to identify the problems faced in the international market and to identify some real difficulty to the Bangladesh garments in the international market in near future. Finally, recommend some of the measures needed to be taken for increasing the export volume and to know the current RMG export status of Bangladesh.
The report title “Export performance of readymade garments sector of Bangladesh” has been prepared as a practical fulfillment of BBA. The student is required to undertake an internship program. For this purpose, each of there is attached with or organization. During the internship, a student has to prepare a report on the organization where he is assigned. He has also to undertake and were under investigation o the organization for detailed study.
The basic purpose of this attachment is to expose the student to the real business world. This exposure acquaints his with the practices of the modern business world. This exposure is very helpful is seeing for oneself how things move and to find the gap as well as the similarities between theoretical and practical knowledge.
Aim and objectives of the study
The main objectives of this internship report is to provide on Export performance of readymade garments sector of Bangladesh
- To know the export performance of Bangladesh garments in international market;
- To identify the difficulties and barriers faced in the international market;
- To identify possible threats to the Bangladesh garments in the international market in near future;
- To identify the opportunities of the Bangladeshi garments that may be realized in the international market.
- To recommend the measures needed to be taken for increasing the export volume.
- To know the current RMG export status of Bangladesh.
- To full fill the course requirement
The basic data is secondarily used in the preparation of this report are obtained from:
- Studying of different files and company report.
- Small-ranged researching on published materials
Primary source: The primary data are collected through interview of employees (primary source: within the organization). The sampling therefore based on a convenience sampling method. A convenience sampling method is less costly and takes in easily accessible data sources.
Data collection method:
All data are collected through company’s annual report and through an interview process.
Ratio Analysis: Ratio Analysis will take in the ratios of the last 5 years for study on the basis of the companies’ published annual report.
Sensitivity Analysis: the Sensitivity Analysis will also take in the last 5years study.
Data Analysis and Instruments: Data Analysis has been done primarily with the help of MS-Excel. Statistical calculations have been done with Excel and SPSS software.
Secondary source: Internet, company catalog, ad firm data.
History of the Company (Dhakarea Ltd.).
The Dhakarea ltd is 100% export Oriented knit garments manufacturing. The company is established on 07 September 2000. The Name of Mother company is Yupoong Inc, South Korea. The products undergo stringent quality inspection procedures at each level of the production process. The fabrics are Yupoong-Tex certified. Particularly benefits to attract much emphasis for setting up 100% exports oriented products. This will contribute to earning/saving the foreign currency of the country.
The garments sector occupies the major portion of the economy of Bangladesh. The company good and wide markets UN the country as well as worldwide.
In the export market supply of quality product is considered to be prime determinant for successful marketing of the product. It is generally believed that the buyers do not sacrifice quality for the sake of price. As such, quality of the product must be ensured to compete in the export market. The sponsors of the company to remain always conscious about the quality, design etc. of fabrics. To produce quality fabrics they are required to use proper imported. Right –type machinery and to employ an experienced and skilled person. The quality control section of the project must be equipped with the required and necessary quality control equipment so that at every stage of production quality of the product may be ensured; otherwise, it may difficult for the project to penetrate their product successfully in the international market unless quality is not maintained properly.
The project purposes and designs
Dhakarea ltd setting up Industries consists of Fabric Finishing unit and Garments unit. The project will produce Fabric, beached Dyed finished Fabrics and Knitwear apparels like as Caps and Hats Manufacturing Company.
The project has the most modem and sophisticated machinery in the section of producing quality fabrics, most modern and sophisticated machinery also included in the dyeing finishing unit to produce a quality product. Finally, the fabrics will be used in the garments unit to produce Caps and Hats.
Product Mix and Production Capacity:
The annual attainable capacity of the proposed project based on One shift operation for Knitting section and Finishing section for Garments section per day and working for 300 days in a year.
The annual saleable product of the proposed project based on One shift operation per day of 8(eight) hours each shift and working for 300 days in a year both for Dyeing & Finishing unit and Garments section is 10 hours per day at 100% capacity.
The project will be a Composite unit consisting Fabric dyeing & finishing unit and Garments unit. The product of spinning unit i.e. 2411, 26/1 & 30/1 combed or iMU/Iy.un 1* thf kisif uw material for Various kinds of Dyos and Chemicals like as Reactive Dyes, Salt, Caustic Soda, Soda ash, Wax, Hydrogen Per-Oxide, Detergent, Softener agent etc will be the basic raw material for its fabric dyeing and Finishing unit, which will be imported. The Dyed and Bleached fabrics are the basic raw materials of its Garments unit, which will be received from its dyeing and finishing unit.
Conclusion & Recommendation:
From the detailed analysis, it seems that the Dhakarea ltd technically feasible, economically & commercially rewarding and financially valuable. After implementation of the project will generate direct employment of .25& persons. AI the above measures of investment feasibility of the project indicate that it will be able to generate sufficient revenue from its operation to pay back debt obligation and annual operational expenses. The project is financially desirable & suitable for Bank Financing.
Dyeing & Finishing
Address: Plot No- 23 – 27, DEPZ (Extention Zone), Ganakbari, Ashulia, Savar, Dhaka.
Fax: (880-2) 7788179
Incorporation: 07th September 2000
Product: Caps and Hats
Working capital: USD $5 million
The hundred percent export-oriented RMG industries have experienced phenomenal growth during the last 15 years. Within a very short period of time, it has attained great importance in terms of its contribution to GDP, foreign exchange earnings, and employment and also as a vehicle of social changes. The export earning data of Bangladesh shows that in 1984-85, ready-made garment sector earned 12.39 %( $116 million) of the total export. This was raised to 36.46 %( $471 million) in 1989-90. This share rapidly went up to 53.36 %( $1064 million) in 1991-92. Surprisingly, the share showed no increase for the last three years. Bangladesh garments products are facing various barriers and difficulties in the international market. Garments’ contribution to the total export earning remained constant at around 52% for the years (52.84%) in 1994-95 and 52.63% in 1995-96. For the year 2004-05, the total amount of RMG export was ($5689.09 million). This is the current situation of RMG export from Bangladesh.
Statement of Research Problem:
The first ready-made garment factories in Bangladesh aimed at the export market were opened in the late 1970s by investors from other Asian countries whose exports had been restrained by quotas imposed by importing nations. By the mid-1980s, the ready-made garment industry had become a strong export earner. Garment exports brought receipts of only US$3 million in FY 1981, but by 1984 exports had risen to US$32 million, and the following year revenue soared to US$116 million. For FY 1985 and FY 1986, ready-made garments were the second biggest foreign exchange earner for Bangladesh after jute.
The surge in Bangladeshi exports eventually caused a reaction among some industrial nations. Canada, the European Economic Community, and the United States expressed concern that inexpensive Bangladeshi garments were flooding their markets. In 1985, after a series of notices as called for by multilateral agreements, the United States–which was the destination of about 25 percent of Bangladesh’s garment exports–began imposing quotas on Bangladeshi garments, one category at a time.
Bangladeshi manufacturers, working with the government, organized with remarkable speed and efficiency to adapt to changing conditions. They policed themselves to stay within quotas, allocating production quotas according to equitable criteria, and began diversifying their production into categories where there were not yet quotas: for example, cotton trousers, knitwear, dresses, and gloves. After a period of adjustment, during which some of the least well-established firms closed and workers were laid off, the industry began stabilizing, and growth continued at a more moderate pace. Exports in FY 1986 rose another 14 percent, to US$131 million, and prospects were good for continued growth at about that rate.
The ready-made garment industry in Bangladesh is not the outgrowth of traditional economic activities but emerged from economic opportunities perceived by the private sector in the late 1970s. Frustrated by quotas imposed by importing nations, such as the United States, entrepreneurs and managers from other Asian countries set up factories in Bangladesh, benefiting from even lower labor costs than in their home countries, which offset the additional costs of importing all materials to Bangladesh. Bangladesh-origin products met quality standards of customers in North America and Western Europe, and prices were satisfactory. Business flourished right from the start; many owners made back their entire capital investment within a year or two and thereafter continued to realize great profits. Some 85 percent of Bangladeshi production was sold to North American customers, and virtually overnight Bangladesh became become the sixth largest supplier to the North American market.
After foreign businesses began building a ready-made garment industry, Bangladeshi capitalists appeared, and a veritable rush of them began to organize companies in Dhaka, Chittagong, and smaller towns, where basic garments–men’s and boys’ cotton shirts, women’s and girls’ blouses, shorts, and baby clothes–were cut and assembled, packed, and shipped to customers overseas (mostly in the United States). With virtually no government regulation, the number of firms proliferated; no definitive count was available, but there were probably more than 400 firms by 1985 when the boom was peaking.
After just a few years, the ready-made garment industry employed more than 20,00000 people. According to some estimates, about 80 percent were women, never previously in the industrial workforce. Many of them were woefully underpaid and worked under harsh conditions. The net benefit to the Bangladeshi economy was only a fraction of export receipts since virtually all materials used in garment manufacture were imported; practically all the value added in Bangladesh was from labor.
Country’s RMG producers have been steadily moving towards high-value sophisticated items like high-quality suits, jackets, branded jeans items, embroidered ladies’ wear etc. They are now producing a wide range of garments items and have expanded their market worldwide. Increasing at the rate of 27% per year over the. Last several years, utilizing quota and diversifying their products into non-quota items, the country presently holds 6th largest apparel exporter status in the USA while 51h largest in the European Union (EU).
Japan has been a very quality conscious market in the world. Bangladesh very recently has proved itself to be prospective in RMG export to Japan also. In 199495, export of RMG to Japan from Bangladesh jumped up to US$ 5.61 million or by 168% of the previous years. It shows that the apparel producers are gradually catching up with a quality requirement of the buyers in the international market.
We followed by EU led the major share of the country’s RMG export market from the very beginning. But during 1995, EU overtook the US. Among countries in EU, Germany has been topping the list over last several years followed by UK, France, Italy and The Netherlands. In 1995, Germany imported apparels worth US$ 317.86 million against US$ 245.39 million in 1994. Only Shirts and T-shirts that Germany imported in 1995 were worth US$ 202.36 million. As single country, however, US has been the highest apparel importing country for Bangladesh.
Ready Made Garments Export Condition to Buyer:
The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) is the only recognized trade body that represents the export-oriented garment manufacturers and exporters of the country. Struck by the 70s’ political turmoil in Sri Lanka and price hike in other Asian countries, garment buyers in the international markets explored the potential of the newly born Bangladesh. Fortunately, with the timely policy support from the government, entrepreneur’s talent and efforts as well as the labor of the workforce, the ready-made garment (RMG) industry could impressively succeed and the buyers got confidence in it. Now its development rate is, on an average, 20% per annum. With a huge supply of cost-effective labor force, country’s economic factors are in favor of development in this relatively low capital and high labor-intensive industry. Starting in the late 70s as a small nontraditional sector of export. Ready-made Garment (RMG) emerged as a promising export earning sector of the country by the year 1983. Bangladesh at that time lacked a pectoral trade body, non-government in nature, free from traditional bureaucracy, to help the sector to boost up the country’s foreign exchange earnings. Entrepreneurs and the government in the post-independence years felt and emphasized the urgent need to develop non-traditional items of export for helping the struggling economy. As a result, 1977 marked the birth of Bangladesh Garment Manufacturers and Exporters’ Association (BGMEA). Since its humble inception with only nineteen (19) garment manufacturers and exporters, BGMEA has grown into a strong and dynamic body. Today it proudly declares registered membership of more than 2700 garment manufacturers and exporters. Of the total 2700 units, about 1932 garment factories. Are located in Dhaka while about 155 and 415 factories are located in Narayangonj and Chittagong respectively. Factories are located in Dhaka while about 155 and 415 factories are located in Narayangonj and Chittagong respectively. These 2700 garment factories having about 1.5 million workforces is earning 73% of the country’s total foreign currency. About 15 million people are directly dependent on this sector. The growth of Freight Transport, Bank, Insurance, hotel etc. in the country are the gift of the garment industry. In a nutshell, the garment industry has become the pivot of the country’s economy. The fundamental objective of BGMEA, however, is to establish a healthy business environment for a close and mutually beneficial relationship between the manufacturers, exporters, and importers in the process ensuring a steady growth in the foreign exchange earnings of the country. To this end, BGMEA has been playing a very strong role to lead the industry in concurrence with the government. The following are the regular activities of BGMEA for its members, owners, apparel buyers and other partners.
Bangladesh: Special Feature
The competitive strength of a firm or a country in the market depends on its specific comparative advantage(s) which its competitors do not have. A particular uniqueness of a supplier shapes up its strategic advantage profile. In case of Bangladesh, this uniqueness is the unlimited availability of unusually cheap but usable labor. It is the abundant supply of the comparatively cheap labor that stands out as the significant strength. The RMG industry by its nature is a low technology but labor-intensive industry. The workers can be employed at very low wages, not only in comparison with other competitor countries but also in comparison with other domestic industries in Bangladesh. In the domestic market as well, the wages of the workers of the RMG industry happen to be the lowest.
The External Threats
Bangladesh has successfully established a remarkable presence in the world markets, particularly in the US and EU markets. If one analyses its external threats and opportunity profile, one finds that its powerful competitors will try to influence the trading environment in such a way as will create hurdles for Bangladesh to retain or improve its competitive edge: This hurdle can take numerous forms. Broadly, these are discussed in two categories: (1) Phasing out of MFA and (2) Other non-tariff barriers.
(1) Phasing Out of MFA
It seems that the phenomenal growth of RMG exports from Bangladesh has become a threat to its powerful competitors. Naturally, they (the competitors) are preparing to snatch away the markets from Bangladesh with aggressive and “innovative” business strategies. They will certainly take advantages of the new provisions included in the final Acts of Uruguay Round. One such provision is the phasing out of the MFA.
Before we can answer the question whether the phasing out of MFA will be a threat to Bangladesh, we need to understand the origin and meaning of MFA (Multifibre Agreement). The GATT did not originally include textile and apparel industries in its principles of MFN (Most Favored Nation). The Uruguay Round (UR) decided to integrate textile and RMG industries into GATT system. As is well known, GATT/WTO prohibits not only unjustified tariff barriers but all forms of non-tariff barriers including the imposition of “quota”. In the sixties, while GATT principles prohibited discrimination between the trading partners, it allowed certain exceptions to GATT principles on the ground of “fairness”. Such an exception is WA. To achieve this goal, a special provision known as MFA was instituted. Under the MFA provisions, GATT allowed the USA and other importers of RMG to impose quota restrictions. The MFA has been in place since 1974. Later on, when trade liberalization policy started riding high, the arguments for phasing out the MFA were put forward by those countries which were hurt by it.
(2) Other Non-Tariff Barriers
The Final Acts of the Uruguay Round (UR) negotiations expanded, integrated and strengthened the GATT principles of reducing/eliminating all forms of trade barriers with a view to increasing world trade. It is easier to identify and remove trade restrictive tariff barriers because they take so many and such subtle forms that. Multilateral negotiators face more disagreement than agreement on their definitions. For example, customs evaluation procedures suitable in a particular country may be interpreted as deliberately created non-tariff barriers by its trading partners. Similarly, there is a scope for “misinterpretations” of subsidies given to exporters by the respective government. The child labor, environmental and human right issues are also susceptible to similar “misinterpretation.
For decades the world’s garment trade has been governed by a system of quotas. It limited the amount efficient countries like China could export to the big markets of the United States and Europe. The original intention was to protect the garment industries in the West. But the effect was to guarantee less developed countries like Bangladesh a slice of the trade. Quotas were abolished from 1 January 2005. Retailers are now free to buy from whatever country can make garments for the lowest price. It could mean cheaper clothes for consumers but the pain will be felt in slums in the developing world.
Competition has become intense in the garment industry at present. The garment industry is emerging rapidly in Taiwan, Hong Kong, Singapore and Korea in Asia. Thailand, Malaysia, Indonesia, Philippines and Sri Lanka have found the garment industry more attractive to develop their economy from 70’s decade. Vietnam has become a potential entrant in garment industry throughout the world.
Threat from Various Regional Organizations (Such as NAFTA, EEC, EFTA, etc.) The trend of the modern world is regionalism to strengthen the economy of the member countries through co-operation. North American Free Trade Association has been signed recently and the main initiator of NAFTA is the USA, who is the main buyer of the garment from Bangladesh. According to the treaty of NAFTA, USA will invest its domestic resources to develop their economy by using 60% of their own raw materials through utilizing the low-cost labor of Mexico. So, it is a potential threat to the garment industry of Bangladesh. On the other hand, EC countries have already declared a single currency for European Common Market called ECU (European Currency Unit) to protect the interest of the member countries through cooperation. This sort of protectionism is a great threat to the garment industry of Bangladesh, because Germany, Britain, Denmark, Norway, Belgium, Italy, etc. are buyers of the garment of Bangladesh.
The scarcity of Raw Materials:
There is no alternative of ample supply of raw materials in order to become self sufficient in any industry. The raw material of the garment industry of Bangladesh is foreign dependent. Bangladesh has to import raw materials of garments from abroad in order to process it in Bangladesh. About 70% of garment export income has to be spent for the raw materials. Moreover, the export and import policy of Bangladesh is very weak. So, the scarcity of raw materials for the garment industry’ in Bangladesh is a great threat.
Bangladesh is not a stable country politically. Political instability is a great threat to any industry of our country. Frequent strikes and hartals are great obstacles to the growth of any industry. The production cost increases and productivity decrease because of frequent hartals and strikes. Garment producers cannot keep their contract with buyers because of hartals and strikes. Hartals and strikes have become a common phenomenon of Bangladesh.
Bangladesh economy to grow at 6 percent despite key challenges: IMF
Bangladesh’s economy is expected to grow six percent next fiscal year despite the abolition of quotas for textile exports that was predicted to cause massive job losses. The economy grew 5.5 percent in the fiscal year ended June 30. The IMF forecast is in line with a finance ministry budget estimate in June that said the economy was recovering from devastating floods last summer and had coped well in textile exports deposit the loss of quotas that opened up competition with larger rivals Such as China and India.
The international textile quota system, known as the Multifiber Arrangement, was abolished at the end of December 2004 prompting predictions that as many as one million jobs would be lost in Bangladesh.
In the year to June 2004, Bangladesh exported goods worth 7.56 billion dollars with textiles accounting for 75 percent. “Looking forward, (the IMF) underscored that Bangladesh faces the key challenges of accelerating growth and maintaining macroeconomic stability while overcoming the potentially significant impact of the MFA phase-out,” the IMF said.
The Conference of AMGs
With the phasing out of Multi-Fiber Agreement (MFA), the readymade garment industries of the countries, which have a weak textile base, are feared to be on the brink of an uneven challenge. There have been widespread concerns by the exporters and experts about the possible fate of the countries garment exports, which, the experts think can only get special support if more preferential access to the US market, the biggest destination of local RMG products, could be achieved.
With that aim in view, the BGMEA took the pioneering role in placing a trade bill in the US Congress, which, if passed into law, will benefit 14 AMGs including Bangladesh.
To strengthen the efforts, the association has taken a landmark decision to hold a conference of the stakeholder AMGs in Dhaka in June to garner their support in favor of the bill.
Meanwhile, the tremendous response has been received from the invitees. It is indeed a vivid demonstration of the wisdom of the current BGMEA leadership, which is expected to be culminated into having a joint declaration participant at the end of the conference.
The products of AMGs: low-price garments in a higher-quality market
In clothing as in cotton fabrics, the AMGs tend to focus on exporting standard products such as T-shirts, men’s shirts and woven and printed fabrics, for which price is the main determinant of success and in-depth knowledge of fashion and design trends is not essential. However, in recent years a change has been taking place in the developed markets, away from cheap imports towards better-finished, higher-quality casual fashion and more individual clothing, the opposite of AMG garment exports.
Nevertheless, Bangladesh has a number of ‘champion’ export products (i.e., achieving high growth in a dynamically expanding market), particularly women’s knitwear. Haiti, another example of a textile-exporting AMG, has been doing very well with exports of cotton T-shirts and women’s clothing. Its garment exporters are increasingly exporting sophisticated items like high-quality suits, jackets, and branded items. This has helped them to penetrate Japan’s extremely quality conscious market. Bangladesh has shown that it is possible to move successfully up the value chain by exporting finished products. In 1999, it was by far the largest single AMG exporter of finished, woven fabrics with 85% cotton or more, weighing up to 200 g/m2.
Government trying to overcome problems in RMG sector
Speakers at a seminar said the government is making all-out efforts to overcome the problems of garments sector and trying for duty-free and quota free access of Bangladeshi goods to the US and European markets.
The sector is the main foreign currency earner, which earned 70 percent of the country’s total exports last year. EPB Vice President said that Bangladesh has got duty free access to Australia from 1st July. It is the 4th country to give the duty-free opportunity for Bangladesh products. Earlier Canada, Japan, and Norway have given duty and quota-free access to Bangladeshi products.
Bangladesh made faster economic growth
The World Bank on Sunday said Bangladesh made faster economic growth in last two financial years and predicted that the projected 5.5 percent growth of this year’s gross domestic product (GDP) was ‘very likely’ to be achieved owing to good rice harvests, reports BSS. The export performance also marked a steady progress with 16.2 percent increase in first seven months of the current fiscal. The export of ready-made garments (RMG)- both woven and knitwear-has picked up due to increase in global demand and the consolidation process in the industry, which earns over 70 percent export earnings.
The Fastest Growing Export Sector of The Country
Starting in the late seventies, the apparel industry of Bangladesh now accounts for over 64% of the country’s total export earnings. Country’s apparel export rose to US$2628 million in 1996 from a mere US$6 million in 1981. To about 30 countries around the world, Bangladesh presently exports ready-made garments, with over 45% to the USA, 50% to the countries in EU and 3% to Canada and rest to the other countries of the world. Country’s apparel export has been growing on an average at the rate of 25% for last several years. The country, last year ranked 6th largest apparel exporter to the USA the EU.
Yarn Manufacturing Process
Textile mills purchase cotton and receive the bales from gin yards or cotton warehouses. These mills start with raw bales of cotton and process them in stage until they produce yarn (fibers twisted into threads used in weaving) or cloth (fabric or material constructed from weaving).
The first stage is in the opening room. Here, bales are opened and laid in a line on the floor, side by side, near a cotton opening machine. This machine travels along the line of opened bales, pulling fibers to be sent to a mixing machine and them on to the carding system.
Carding is the process of pulling the fibers into parallel alignment to form a thin web. High-speed electronic equipment with wire-toothed rollers performs this task. The web of fibers is eventually condensed into a continues, untwisted, rope-like strand called a silver. These silvers then continue to a combing machine. Here, the fibers shorter than half-inch and impurities are removed from the cotton.
This process makes the silver smoother so more uniform yarns can be produced. The drawing or pulling of this sliver is next. Cotton trivia khaki is derived from a Hindu word that means “dust color”. Originally, khaki referred to a dull yellow-brown cotton or wool uniform fabric used for its camouflage effect.
The sliver is drawn out to a thinner strand and given a slight twist to improve strength, and then wound on bobbins (spools wound with the thread like the product for storage). Having completed this process. It is now called roving. The roving bobbins are now ready for the spinning process.
Spinning is the last process in yarn manufacturing. Today’s mills draw and twist the roving into yearning and place it on bobbins. They do this quite efficiently. A large, modern mill can produce enough yarn thread in 30 days to wrap around the earth 23000 times or go to and return from the moon 235 times. With the use of automatic winding, the yarn bobbins are transferred to large bobbins called cheese cones can be stored until they are needed in the weaving process.
The weaving process uses yarn that, depending on how it lies in the woven goods. This yarn may now be either a warp or a weft yam. Warp refers to yarns that run lengthwise in woven goods. In preparation of warp yarns for weaving, hundreds of yarn strands are wound from cheese cones onto a large warp beam. Yarns on this beam are then coated with a sizing compound (a starch mixture) to add strength for weaving. The sized yarns are then wound into a loom beam that will be placed on the loom (a machine used to interlace yarns to from cloth). The weft is the yarn that runs crosswise in woven goods and may be referred to as filling yarn. Sizing is not placed on weft because flexibility is needed in the weaving process. In today’s most modern mills, the weft is fed into the loom from cheese cones with air-jets at such a high speed that its movement cannot be seen.
The woven cloth from the loom, called greign or grey, is whitish but has a natural yellow tint. This cloth is further treated by various means to improve its appearance and feel, and then either bleached, dyed or printed to produce the fabrics used in various products seen on store shelves.
There are three basic weaves that are used. The plain weave, the most common, is produced by passing the weft yarn over and under each warp yarn, alternating each row. This is used for cotton print cloth, sheeting, muslin and more. The twill weave is produced by interlacing yarns in an angle to form straight, diagonal ridges across the fabric. The satin weave has a surface that consists mostly or warp yarn which is passed over and under all but one weft yarn that intersects in a regular or irregular formatting, not a straight line.
This weave produces a fabric with a smooth surface. It is used for upholstery, home decorating and fashionable apparel.
The fabric is constructed of yarns made into loops (stitches) which are linked together by the use of needles. There are two basic types of knitted fabric. The weft knit fabrics are made with yarns forming loops the width of the fabric on a circular machine, producing jersey knit used in T-shirts and underwear. The warp knit fabrics are produced by feeding yarns to form loops in a lengthwise direction and are used for tricot fabrics and cotton lace. Knitted fabrics are softer and more flexible than woven fabrics. Making them ideal for sweaters, active sportswear, and hosiery.
Knitting is one of the ways of turning thread or yarn into clothes. Fabric completely consists of horizontal parallel courses (crosswise) or yarn. These courses are joined to each other by interlocking loops where a short loop of one course of the yarn is wrapped over the bight of another course.
The fabric is obtained either by hand Fabric process then by machine. In hand knitting process, a base series of twisted loops of yarn are made on a knitting needle before starting the process. A second needle is then used to reach through each loop in succession to snag a bight of yarn and pull a length back through the loop. Fabric by machine uses a different mechanical system producing nearly identical results.
Fabric composites show higher impact tolerance compared to the traditional composites or even to woven fabric composites. It is believed that the hand knitting originated among the nomads of the Arabian Peninsula about 1000 BC.
Types of fabrics:
Weft fabric-It is either made by hand or machine by looping together the lengths of the yearning. This supports the fabric to become stretchy and comfortable. Weft-knitted fabrics are used in socks. T-shirts an jumpers.
Warp knitted fabric- It is made by machine only. The loops, in this kind of fabrics, interlock along the length of the fabric. It is only slightly stretchy and it does not ladder. These are used as swimwear, underwear etc.
Advantages of Fabric Wears:
Because of casual and soft in nature as well as inherent good properties such as hygienic properties, fashionable design, and color, knitwears have become the popular wear all over the world. Knitwears are informal but fashionable usually with short sleeves. Knitwears are commonly made of knitted fabrics of single jersey, Ribs, Interlock, etc due to the specifications in raw materials by using lower count of yam, construction of fabrics and stitching. Knitwears possess certain properties which are essential for good apparels; some special advantages of fabric-wears are given below:
1) Fabric garment products are softer and more comfortable;
2) Fabric garments are usually used as underwear Garments i.e. used for soft skin abrasion.
3) Usually, lower count of yam is used for knitting fabrics. So, Fabric has more socking capability.
4) More profitable production can be made due to lower Project cost and cheaper management cost.
5) Fabric wears can be handled more easily while using And washing. ,
6) Its market price is comparatively cheaper.
To establish a garments factory the location choice is an important factor for correct manufacturing, worker management, and proper transport system.
The following are some of the factors which will influence the choice of location:
- Availability of worker.
- Availability of housing facility (In Bangladeshi system it is not provided by any garments authority)
- Availability of staff amenities.
- Availability of transport.
- Availability of materials.
- Availability of cover-van parking space.
- Adequacy of circulation.
- Availability of services.
- Disposal of waste
- Suitability of land and climate.
- Local building and planning regulation.
- Safety requirements.
- Site cost.
- Political situation.
- Special grants.
According to the place and types of manufacturers goods, the building shape has been Chosen. Here I mentioned both the advantages of a single and multi-story building. It depends on the size of the garments factory, which prefers most.
The benefit of the team in garments:
- Increase the group activities in production.
- Makes a competition among the team worker.
- Workers get satisfaction to work.
- Instrumental benefits.
Control is a regulation of organizational activities so that some targeted elements of performance remains within acceptable limits.
Purposes of control:
- Adapting to environmental changes.
- Limiting the accumulation of errors.
- Coping with organizational completes.
- Minimizing cost.
- Keeping the organizational work on track (according to Plan)
In garments sector, the control is divided into three sections.
- Production control.
- Overall/Operational control.
- Financial control
- Preliminary control
- Screening control
- Post action control
Preliminary control concentrates on the resources-financial, material, and human and information-that the organization brings inform the environment. Preliminary control attempts to monitor the quality or quantity of these resources before they enter the organization.
Screening control focus on meeting standards for products or service quality or quantity during the actual transformation itself. Screening control relies heavily on feedback process.
Post action control:
Post action control focuses on the outputs of the garments after the transformation process is complete. Coming’s old system of Post action control-final inspection after the product is completed. Although corning abandoned its Post action control system, this still may be an effective method of control, primarily if a product can be manufactured in only one or two steps or if the service is fairly simple and routine. Although Post action control alone. May not be as effective as preliminary or screening control, it can provide management with information for future planning.
Financial Control is the control of financial resources as they flow into the garments (i.e., revenues, investments), are held by the garments (i.e., working capital, retained earnings), and flow out of the garments (i.e., pay expenses). Business must manage their finances so that revenues are sufficient to cover costs and still return a profit to the firm’s owners.
Prepare a garments budget:
Budget is a numerical expression. A good budget can provide a good exported or productive garment. Without the budget, a garments can’t run correctly. Only with the help of a good budget, the goals can come out. The budget helps to take correct decision and divers the organization properly in right way. The budget also shows the capacity of garments in the product market. Only a suitable and acceptable budget can run the garments correctly. For this reason, the budget is essential for the garments.
The processes of preparing the budget in garments are as follows:
- Submission of budget request by the units to division head.
- Integration of unit budget and consolidated into division budget.
- Forwarding of division budget to the budget committee.
Conclusion and Recommendation
In order to sustain the smooth growth and development of the garment industry of Bangladesh, Government should play a key role to offer a good export policy. Otherwise, the production, employment, earning of foreign currency and economic development of the country will be affected seriously. Some recommendations have been offered to face the problems of the garment industry of Bangladesh.
Regarding the problem of RMG sector, I’ve identified some recommendation for the betterment of this sector. The recommendations are as follows:
The Government of Bangladesh should play a key role in the expansion of the market of the garment by diversified items for manufacture and export. It is very important fact that there are many items in the RMG product lines which Bangladeshi entrepreneurs have not yet started production. Leather items, life jackets, gloves, bags etc. are among few such items. Among other items are the umbrella, nylon school bags and jackets, ice sports kits and wears, staffed toys, highly competitive market fashion garments are examples. There are numerous such items not yet touched by our entrepreneurs.
All out efforts would be made and steps were taken for production and export of high priced readymade garments in the light of the prevailing market demand.
Immediate steps shall be taken to establish a Fashion Institute pending establishment of the Fashion Institute measures will be taken, under special arrangements, to extend expert services to match the actual demand. Liberal credit may be considered for capacity building and hiring technology for producer of high-quality garments.
Product-Specific decisions: Readymade Garments
Provisions have been made for the exporters of readymade garments to retain in their respective foreign currency accounts the portion of their export earnings required for meeting the expenses on importing fabrics and other accessories through the back-to-back letter of credit. The exporters that way shall be saved from incurring losses by first converting their export earnings to Taka and then reconverting the same to foreign exchange for payment of import bills on raw materials.
For making hand-woven sweaters of natural and synthetic wool imported under customs and permission would be accorded to take up such wool outside the bonded area, provided the concerned firm furnishes a bank guarantee for the equivalent amount of customs duty livable on such raw materials.
Labor Productivity Improvement.
However, it is to be noted that the lower material procurement cost may not be enough for Bangladesh to maintain its competitive edge in international markets. Bangladesh must increase productivity, which is lower than many of its competitors. It is true that wages are low in Bangladesh, but it does not necessarily mean that relatively low wages automatically lead to higher productivity. Wages are only one of the determinants of labor productivity. The time required by the Workers to perform a task is another important determinant. Available efficiencies indicate that Bangladeshi workers are not as those of Hong Kong, South Korea, and Sri Lanka. The workers’ skills and supervisors’ managerial efficiency are higher in those countries than in Bangladesh. In addition, those countries use the latest technology, for example, computerize sewing machines, design facilities, etc. but Bangladesh uses relatively older technology.
Other Strategic Implications
There are potential problems with supplies and financing. A conglomeration or a strategic alliance of domestic firms or with foreign firms or both is the only feasible solution. This tie-up-marketing will ensure long-term business interest to the domestic producers.
Most of the exporters do not provide good post-sales services or are bent on relational marketing. The exporters and entrepreneurs have to take measures in this context.
The exporters are willing to form joint ventures, but they are keener to get financial benefits than technological benefits. Exporters should be taught or given necessary counseling in taking the advantage of technology transfer. EPB can take the further progressive role and arrange training, workshop, interviews, and fieldwork in various capacities.
Import of samples for each category of garments:
At present, the facility exists for duty-free import of 20 pieces of samples for each category of garments subject to a maximum of 100 pieces. Imported samples are, however, subject to mutilation at the customs paid.
Rationalizing the rate of value addition:
It has been found that keeping the rate of value addition flexible is congenial for the growth of the country’s export trade. Therefore a Standing Committee will be formed for rationalizing the existing rates of value addition for all commodities including readymade garments.
When a garment export unit relies exclusively on locally procured cotton and accessories through back-to-back L/c the maximum amount of back-to-back L/C in case of knitwear unit would be equal to the value of the master L/C.
Import of grey clothes:
With a view to expanding the base of backward linkage industries, permission is being accorded for import of grey clothes, through usual procedure for use in the export industries or for direct export against specific export orders. So long this facility used to be given only to the dyeing, printing and finishing factories. Since value addition in the readymade garments sector did not take place up to its potentialities inspire of this facility the government has allowed the exporters of readymade garments to import grey clothes.