Bangladesh is the first choice for apparel sourcing after China, according to a report released by global management consulting firm McKinsey & Company which interviewed the Chief Purchasing Officers (CPOs) of retailers from Europe and the US, whose combined sourcing strength stands at US $ 70 billion.
As such many buying houses both domestic and foreign have come up in the country that source for almost all major global retailers and brands. In the year gone by, the primary focus has been on small orders and niche products with many sourcing houses showing keen interest in product development and value additions.
“At present I am majorly sourcing the regular products for my buyers, but gradually I will make a shift from the run-of-the mill products to the niche, like functional wear and seamless garments,” maintains Abujore Md Shamaun, Managing Director of Motif International, catering to European buyers sourcing primarily T-shirts and polos for them, underlining his strategy for existence and expansion. With increasing number of players in regular categories resulting in stiff competition and supply exceeding the demands hitting margins thereby, Shamaun holds that concentrating on niche plays to his advantage “I have already started sourcing small volumes of functional garments and if I continue to focus on the same, it would be easier for me to grow faster,” avers Shamaun who goes on to underline that in last two years, Bangladesh has proved its mettle as a manufacturing destination for critical product categories such as lingerie, outwear jackets and structured garments and the way the hub is moving ahead, even the bigger and established players have started realising that to fetch better margins, they would have to go for niche.
Also Read – Motif International: Looking for creating niche for sustained growth
Echoing similar sentiments, Knn Linku, CEO of US $ 15 million Caretex (a decade-old garment exporting company with a rich experience of sourcing variety of products for its clients from across the globe including Walmart, Inditex, Next and Celio) maintains, “In basic garments, there is not much profit right now with multitude of competitors, so we are looking at the specialized sections to help our cause better.” As such Linku was in talks with a UK-based company which required electromagnetic radiation resistant workwear or EMF clothing. Being a manufacturer himself, Linku is also mulling getting into bonded lingerie and socks as well to expand his portfolio in the niche.
Also Read – Caretex plans it big for future
For India-based Fifth Avenue with annual turnover of US $ 70 million which established its Bangladesh office in 2008 by shifting the business from China, value addition and small quantities are synonymous with it. Sourcing between 2,000 and 10,000 pieces per style, Fifth Avenue can drop to just 500 to 600 pieces per style depending on orders. However, to minimize process losses, key to handle small orders, Fifth Avenue lays great emphasis in vendor selection. “People should keep count of what goes out and what comes in. Garments go out for printing and come back 100 pieces short. Such losses cannot be heaped on the client indiscriminately…,” explains Founder and Chairman of Fifth Avenue Promodh Sharma, who is also a firm believer in product development for business growth. Heading the company’s product development team, Promodh often travels to countries such as Japan and Los Angeles to look for developments done by various other brands – no matter big or small, to keep abreast of the new happenings.
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Wilson Design Source Supply with sourcing operations in India, China, Hong Kong and Pakistan, and present in Bangladesh for more than 15 years, is another company with major thrust on value additions. It is the company’s design development-based approach towards apparel sourcing that sets it apart from others. Since the first task is of design development, everything starts from the company’s headquarters in Glasgow, where a team of designers who constantly travel to fashion destinations such as Milan, Paris, Tokyo, Korea and New York is based; their observations and experiences are compiled in a trend book and presented to the buyers.
“We are able to give a more diverse range of products to a buyer or a brand compared to any other, hence brands prefer to work with us,” underlines Al Amin (Sohel), Country Manager of Wilson Design Source Supply – Bangladesh, whose 70% of total sourcing from the country is of knits and the rest comprises of bottoms, casual shirts and sweaters. Since Wilson works with brands and retailers looking for value-added products, the order quantities offered are also relatively low. “No one will buy basic products through a trading company as the margins are already very low and coordination with the buyers is less cumbersome,” explains Sohel whose company also stresses on compliance, a key for business success in these changing times. “Whenever new manufacturers approach us for business, their factories are reviewed by our production and merchandising teams for the machineries, capacities and systems. The next to visit them is our team of compliance auditors and they review the company’s present certifications,” concludes Sohel.
