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Presentation on

BANGLADESH KNITWEAR INDUSTRY:


RETAIL BRANDING, GOVERNANCE
AND MARKET CREATION
Rashedul Kabir
Sr. Asst. Secretary (R&D), SEIP, BKMEA
Bangladesh: A Rising Economy of the World

• Grown at a sustain rate of 6 percent over the decades with a GDP growth rate of
7.05% in 2016 (Trading economics, 2017).
• Emerging regional hub due to competitive and easily trainable labor force along
with its strategic location lies between South and South East Asia.
• Producing high-value added, technology-intensive and world class ceramics,
pharmaceuticals, furniture and recently, ocean going vessels along with the Ready-
made garments (RMGs) products.
Bangladesh: A Rising Economy of the World

• Bangladesh: Asia Pacific’s 8th largest consumer market and 36th globally by 2030-
(Sarah Boucher, Asia’sConsumer markets of the Future, September 29th, 2014)
• Bangladesh included in “Next 11” of 21st Century. (Goldman Sachs April 2007)
• Bangladesh included in “Frontier Five”- From Ho Chi Minh to Mexico (JPMorgan
Chase April 2007)
• Stable position in sovereign credit rating ( Ba3 by Moody’s in April 2016 & BB- by
Standard & Poor's in May 2015)
Knitwear Sector of Bangladesh
• Bangladesh, 2nd largest exporter of Knitwear accounts for 6% share in the global
knitwear export;
• Maintaining more than 75 percent domestic value addition in the knitwear sector
over the last decade;
• Contribution to national export almost 40 percent and GDP 6.2 percent;
• Contributing to generate around 2 million employment , most of whom are female;
Knitwear Sector of Bangladesh
Sectoral contribution to National export in FY 2015-16

Frozen & Live Fish , 1.56


Agricultural Products , 1.73
Others, 3.41

Petroleum bi Products , 0.86

Leather & Leather Products , 3.38


Knitwear , 38.98
Engineering Products 1.48

Other Footwear , 0.63

Home Textile , 2.19


Woven Garments , 43.02
Jute & Jute goods , 2.68

Source: Compiled by iART from EPB


Knitwear Sector of Bangladesh
• Set up a target of exporting US$ 21 billion Knitwear by 2021.
• Playing a significant role to poverty reduction, women employment and
empowerment
• Played significant role in achieving Millennium Development Goals(MDGs) set by
UN.
• Expected to keep significant contribution in realizing the Vision 2021 and SDGS
Knitwear Sector of Bangladesh and Branding

• There is no fashion brand from Bangladesh knitwear industry which has a


noteworthy global presence till today.
• But, Bangladesh is producing products for world’s dominating brands like Adidas,
H&M, Walmart, GAP, Hugo Boss etc.
• In fact, many of the global brand origin countries even don’t have well established
Knitwear industry in their own country.
Why branding is necessary

1) To enhance the export of knitwear; ($220 billion export markets & more than $1 trillion retail
markets in the world)

2) to grab the market of US$108 billion including retail sells, left by china by 2025;
(Global Textile and Apparel Sector Trend Report 2016)
3) to increase the global value addition in the supply chain (N.b. currently Bangladesh is adding only 6-7%
value of global value chain for knitwear products )

4) to sustain the competitiveness position; adding more foreign currency to the


national reserve; so it is high time to create own brand
Branding World Class Knitwear Industry in the World

• Entrepreneurs invested hundreds of thousands US dollar to build world


class compliant factory.
• Out of the world’s top ten (10) green industry, seven (7) factories are
located in Bangladesh.
Brand Is Not Just A Product
Brands

ORGANIZATIONAL ASSOCIATIONS BRAND PERSONALITY

Products
COUNTRY OF ORIGIN SYMBOLS
 Scope
 Attributes
 Uses
USER IMAGERY BRAND/CUSTOMER RELATIONS
 Quality/Value
 Functional benefits

EMOTIONAL BENEFITS SELF-EXPRESSIVE BENEFITS


Branding process involves…
In creating a unique name and image for a product in the consumers' mind, the
Branding process involves-

 Creativity
 Consistent campaign
 Consistent theme
 Credibility
Price Gap: Opportunity to Utilize this Gap?

Per Unit Price(CIS Price US$) Per Unit Brand Price US$
Product
BD to USA BD to Sweden USA Sweden

610821 (Lingerie) 0.69 0.89 13 9

610910 (T-shirt – Knitted) 3.52 2.45 25 17

610990 (T-shirts – Knitted) 2.49 3.41 19 14


Percentage (%) Share of Global Value
Chain for Bangladesh

Percentage (%) Share of Global Value Chain for Bangladesh


Product
USA Market Sweden Market
610821 (Lingerie) 5.31 % 9.89 %

610910 (T-shirt – Knitted) 14.08 % 14.41 %

610990 (T-shirts – Knitted) 13.11 % 24.36 %


Price gap between ordinary item and
branded item
Value Gaining Vs Value Addition

High
Our Destination

Value possession

Low

Our Initial Position

Low High

Value Addition
Increase Export Volume
Men’s Polo Shirt
Average Selling Price to Buyer USD 02.50-05.50
Actual Price in The Global Market USD 12.00-20.00

Men’s T-Shirt
Average Selling Price to Buyer USD 02.00-03.00
Actual Price in The Global Market USD 10.00-15.00

Increase Export Volume: 15 billion x 2 = 30 billion


15 billion x 3 = 45 billion
New product launch under an
established brand
Increase competiveness in international market

Bangladesh’s Share in China’s Share in World RMG


Year
World RMG Market Market

2012 5.53% 40.75%

2013 5.70% 41.21%

2014 6.21% 38.44%

2015 6.81% 37.66%


Renowned World Sourcing Brands of
Garments from Bangladesh
Domestic Brands of Garments in Bangladesh
Alibaba's success can be
summarized with the letters AHIS
• A" stands for "availability." With two flagship websites
• "H" stands for "habit." The wide "availability" of products attracts buyers to these
websites. To many consumers, when they want to buy something, they - especially the
young generations - search, instead of going to bricks and mortar stores.
• "I" stands for infrastructure. The huge amount of product transactions calls for the
support of infrastructure. Two types of infrastructure are particularly important: online
payment system and fast delivery system.
• "A", "H" and "I" together contribute to "S", which stands for "scale". A large scale in
transactions further attracts more sellers and buyers to these websites, leading to a
positive reinforcing effect on "A," "H" and "I."
H&M: One of the most recognized
brands in the fashion industry
A multinational fast fashion company and pioneer in Fast Fashion, established in
1947. Having 3500 stores, in 61 countries and 132,000 employees till March, 2015
The success of H& M is due to:
• Best fashion items at best price;
• Culture and other policies of the company regarding management style,
operations and employees (best wok practice);
• Having a wide and varied range …from the latest fashion to classic sustainable
fashion;
The secret to the success of H&M can be attributed to their Fast Fashion model.
Steps to Take :1. Preparation

 Make a clear business plan: 6 months 1 year 3 years 5 years


 Do your research: Learn from successful brands
 Build your own brand: Brainstorm about your brand's image
Steps to Take : 2. Finances

 You need a budget to start


There are exceptions to this rule, but unless you have really famous friends or have
an incredible network, you are going to need a basic budget to gain traction.
Steps to Take : 3. Your Apparel

 Design
Ask for advice from an expert while designing your clothing or pay a professional
designer to do the work in which you are personally not specialized.
Start with the minimum quantities and then expand the successful designs.
Steps to Take : 3.1 Your Apparel

 Quality
Leave production to the experts. Spend money on quality because you want to
minimize the amount of returns
Label your clothing, you do not want to have labels from other brands in your
clothing.
Always look to improve, look with a critical eye at your brand
Steps to Take : 4. E-commerce

 Web-shop
Your own online store is great to reach a wide audience with a limited budget.
You want a professional looking website with a clear checkout process for your
customers.
A great website can increase the value of your clothing.

 Free E-Book
Steps to Take : 5. Photography

 Your product pictures are your main selling point.

 A good photographer is expensive, but certainly worth it.


Branding Techniques

 Purpose: Structural technique & purposive technique


 Compatible consistency
 Emotion or understanding
 Flexibility
 Employee Involvement
 Fidelity
 Competitive Awareness
Socioeconomic Contribution by Retail
Fashion Branding

Establish
Retail fashion
brand

Sustained & more


competitive
Greater contribution to
capacity of
GDP growth, employment
knitwear industry
opportunity, living
standard rise to labor,
women empowerment &
poverty eradicate
What Can Be Done to Create Brand?
 Determine target group
 Make brand awareness
 Create entrepreneurs’ interest in going global
 Quality control
 Design Development Capacity Build Up
 Incentives from Government
 Businessmen's Own effort to brand creation
 Emphasize on retail branding with country branding
 Explore the undiscovered opportunity, etc.
Question & Answer

Now What Should We Do?

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