"RMG exporters in a race against time to offset losses" 26 July 2024

Local apparel exporters are in a frantic race to recover the losses they incurred during the latest spell of violence centring the quota reform movement and nationwide curfew, with international retailers and brands pressuring them to ensure timely delivery of goods.

Following the shutdown of factories and mills for four days, apparel exporters are planning to keep their production units open on Friday and pay overtime bills to meet lead times as they believe increasing productivity can offset a portion of losses.

Due to the situation over the past week, suppliers had to cancel hundreds of pre-scheduled meetings and factory inspections. They also could not communicate with foreign buyers due to an internet blackout, which began on July 18 and persisted until July 23...

International buyers are also piling pressure on apparel exporters to ship goods quickly as they have to fill their stores with new designs ahead of Christmas, the biggest retail sales extravaganza in the Western world...

"Buyers do not want to hear about any crisis. They want on-time delivery of goods," said a garment exporter who ships T-shirts and polo shirts to the US and Canada...

It was dealt another blow this year in the form of the Red Sea crisis, which triggered commercial vessel operators to nearly double shipping charges.

The shipment of goods from Bangladesh to Europe is taking at least a month more than in previous times due to the crisis, which has forced commercial vessel operators to forgo the traditional route through the Suez Canal and navigate an additional 3,500 kilometres around the Cape of Good Hope in Africa.

As such, in many cases, international clothing retailers and brands are asking for expensive air shipments so goods can reach stores timely.

If a kilogramme of garment is sent to Europe through waterways, it costs around 10 cents or less. But if the same shipment is sent through air from Dhaka airport, it costs more than $4.

An apparel exporter, asking not to be named, said: "I have planned to keep my factory open on Friday so I can ship goods timely and avoid work order cancellations and expensive air shipment."

However, another exporter said it would be difficult to cater to the work orders because of a raw material shortage, which happened because goods could not be transported to factories over the past week.

Faruque Hassan, managing director of Giant Group, said his American buyers could not place work orders during the past week. So, he sent two of his officers to the US so that he does not lose business.

It will take more than one month to overcome the losses of one week, he lamented, adding that port, customs and transport services should be expedited so the business can run smoothly.

"My buyers are yet to seek discounts or cancel orders, but I am sure that I have to make a lot of air shipments to meet deadlines," said another major exporter, seeking anonymity.

Overtime is the main measure to recover losses, he said, adding that customers are not willing to accept any delays in shipment as they need goods quickly to prepare for Christmas...

Although buyers are not cancelling work orders or seeking discounts, they are putting a pause on work orders or delaying them, which is creating a stockpile of yarn and fabrics in mills...

SM Mannan Kochi, president of the Bangladesh Garment Manufacturers and Exporters Association, said he would sit in a meeting in a day or two with the international buyers and request them to not cancel work orders or seek discounts.