Bangladesh is taking huge strides in the global denim wear market, and in 2013 Bangladesh was the second largest exporter of denim after China to the EU, and for US it holds third position after China and Mexico. The growth of the segment has to an extent been aided by duty-free status to EU and also to some other countries including India. However, it cannot be undermined that denim bottom manufacturing is a competitive product category, and manufacturers are using innovative washing technology, surface ornamentation and then manufacturing at a competitive price to stay preferred suppliers. Bangladesh players have not only excelled in this endeavour, but have actually invested to increase capacities, confident of growth…
While there are 9 vertically integrated Denim units in Bangladesh, the industry estimates that about 700 big, medium and small manufacturing units are producing denim products in the country, though the really big ones are 25. “The way the industry is expanding, the number of sizable denim makers may be many times more by the year-end,” says Showkat Aziz Russell, Managing Director of one of the country’s largest denim fabric Mills, Partex Denim. Indeed, Bangladesh is poised to be the denim manufacturing factory of the world. “I am confident that Bangladesh would make four out of five denim items for the European market by 2020,” adds Russell based on the ever increasing demand for denim fabrics.
Claiming to be the biggest denim bottoms manufacturer out of the country, Tusuka manufactures 1.8 million pieces of 5-pocket jeans per month, from its 6 world-class manufacturing facilities, located in and around Dhaka. Apart from sewing facilities, the company also has denim washing plant, embroidery facility and carton manufacturing facility. The company added a capacity of 20,000 denims bottoms more per day in 2013 to meet the growing demand. “We have invested US $ 7 million in washing unit for adding washing capabilities of 20,000 denim jeans per day and installing 500 sewing machines to produce another 20,000 denim bottoms per day. 2013 was the year of change when we made definite move to go up the value chain by manufacturing a higher FOB product,” says Arshad Jamal, Chairman, Tusuka Fashions.
[bleft] 3.6 billion jeans are produced worldwide for a market worth
US $ 75 billion.
China, Mexico, Bangladesh, Egypt and Pakistan together manufacture 73% of world production of blue denims for exports.
Bangladesh share in EU market on volume bases for men’s denim bottomwear is around 28%, while in the women’s category it is 19%. In the US the country enjoys 10% share in men’s bottom and 5% in women’s denim bottomwear segment on volumes. [/bleft]
Shin Shin Group initiated in 2008 has done exceedingly well manufacturing denim bottoms in Ashulia, with two apparel manufacturing facilities by the name of Shin Shin Apparels and Jeans Plus producing 10,000 pieces of denim daily, and a washing facility by the name of AK Washing Ltd. The minimum quantity the company can handle is 20,000 pieces, as the company believes they are not productive enough to make a lesser quantity profitably. The washing plant has the monthly capacity of 1,30,000 denims.
The company is in the process of adding two more floors to the existing factory to increase production from 10,000 pieces per day to 25,000 pieces per day by the middle of this year. The 1st phase of expansion was completed in November 2013, adding 6 more sewing lines, producing 6,000 denims per day. The 2nd phase will be over in June 2014 and will have 6 lines with fully automated machines producing 10,000 denims per day. “After these phases are complete we will setup another facility by December 2014, similar to this one, producing 25,000 pieces per day, making our total capacity 50,000 pieces per day both denim and non-denim bottoms,” informs Sohel Sadat, the young and visionary Chairman of Shin Shin Apparels Ltd. After all expansions, the company is confident of touching the US $ 100 million mark by 2015.
Another company which is expanding capacities with an eye to the future is Ha-Meem Group, the US $ 300 million company which found its niche in producing fashion denim garments, supplying to global brands such as Gap, Next, MANGO, Calvin Klein and many more. Md. Delwar Hossain, Deputy Managing Director, Ha-Meem Group says that by investing in an integrated state-of-the-art infrastructure and design studio, the Group has been able to adopt innovative ways to service the global client and become market leaders. Moving ahead, the company aims at graduating from 200 production lines to 300 lines by 2015, thereby increasing its production capacities to 7 million pieces of garments per month. “How many factories we have is not important, important is how many production lines we have. We have a factory of 57 production lines in 6,00,000 square feet building area and we also have a factory of 5 production lines,” avers Hossain.
Another big denim bottom manufacturer Ananta, established in 1992 is mainly catering to the US and European market and is presently having close to 4,500 sewing machines, three stitching plants and a laundry plant. Besides this the company also has one button unit, one sweater factory and one suit manufacturing unit. “We are now expanding our denim sewing lines; we will be reaching 100 sewing lines within next one year which will take us to a total of 6,000 machines,” shares Syed Ishtiaq Alam, Director, Ananta.
Fashion Globe is marketing itself for manufacturing most up-to-date washed bottoms. The manufacturing facility has 10 lines with a capacity to produce 2,50,000 pieces every month. Bangladesh has been known for producing basics and with so many existing players, the competition is very cut-throat. “I am already producing basics for Pull & Bear and Alcott but now I am negotiating for their premium range as well. I am not thinking on making my production capacity huge or volume based business but instead I am trying to make it into premium based so the turnover will be huge”. Nazmul Kabir, MD of Fashion Globe has plans to double its denim wear capacity by adding 670 machines more and will eventually reduce its sourcing from the other factories, by 2014.
Like its name, Denim Expert Limited, Chittagong specializes in denim appar
el manufacturing and has in-house state-of-the-art washing unit, embroidery section and testing laboratory to manufacture 3,00,000 pieces per month. In just 26 months since Denim Expert started production, the company has established its name in the market and already achieved a turnover of over US $ 30 million. Plans for further expansion are in place and the company is setting up another project with the capacity to manufacture 20,000 pieces per day, which is expected to be completed within the next year. Mostafiz Uddin, the young MD of Denim Expert has set a mission to manufacture 1.5 million pieces per month and is working towards his goal. “I am working with prestigious brands, like Burton, who has never before outsourced from Bangladesh, and also have my own brand BlueXOnly. I would say I am truly successful the day I can manufacture garments that people think are impossible to manufacture in Bangladesh,” says Mostafiz.
With denim becoming a major category, a few buying offices exclusively catering to this segment have come up. Khaled Obaid Ullah after absorbing rich experience from the industry which also includes the privilege of opening Marks & Spencer’s office in Bangladesh, founded his own buying office Eco Sourcing Ltd. in 2009. Working majorly with European brands (Tiffosi from Portugal, Root & Circle of Sweden and Boden & Johnny Lewis of UK, Eco Sourcing specializes in high-fashion denim bottoms, the quality of which starts with premium fabric unique washes and finishes and quality sewing. Volumes can only derive huge turnover but not higher margins believes Khaled as he is doing small quantities and multiple styles at higher margins. Even there is risk in doing large quantities as the goods are quite often airlifted which eats away all the margins but not in the small quantity order. “We are working on FOBs ranging between US $ 9 to US $ 11 whereas FOB of basic denim is US $ 5-6 as its fabric price is also cheaper,” justifies Khaled.
