After consistent growth for nearly two decades the Bangladesh industry has for only the second time noticed a slowdown in sweater exports, with a dip of 6.32% in FY 2011-12, from the previous FY. Since the stakes are high, as sweaters are a major category for the country – third in line after T-shirts and trousers, the industry has already started upgrading both technology and product to stay a preferred supplier. Considered as the next best destination for sourcing sweaters after China, Bangladesh has seen rapid growth in the segment post 1994, when many new entrepreneurs and foreign companies established their sweater factories within Bangladesh. Team Apparel Online-Bangladesh interacts with many exporters and buying offices on the way forward…
[bleft]“In 2011, the sweater orders for us came down considerably from both the European and American buyers as unprecedented warm weather continued into the traditional winter buying season, reducing the need of sweaters.” – Asraf Ali Chairman, Dynamic Sweaters
“Everybody is showing off and loving to have jacquard machines. Not big range of machines but at least 10-15 machines is something that almost every factory is looking at installing, to add that extra element of fashion which was missing earlier with hand flats.” – Sidharth Shukla Marketing & Merchandising Manager, Floreal Knitwear [/bleft]
It would be prudent to say that the slowdown in sweater exports is not because of a shift in buying away from Bangladesh, but because of changing global conditions and retail needs. Among the biggest factor that has impacted sales of sweaters around the world is the changing climatic conditions due to global warming, as orders reduced considerably with buyers unsure of what and when to buy. “In 2011, the sweater orders for us came down considerably from both the European and American buyers as unprecedented warm weather continued into the traditional winter buying season, reducing the need of sweaters,” says Asraf Ali, Chairman, Dynamic Sweaters. In the business of manufacturing sweaters for the past 19 years, the company has a setup of over 3,000 machines for all kinds of gauges ranging from 3 to 12 gauge, and the company even though facing a loss in orders is still working with a minimum order quantity of 3,00,000 pieces in a month, for buyers like UNIQLO, Charlie and Teddy.
The industry is hopeful that the shift in seasons is only a temporary phenomenon as winter has set in earlier this year than the last year. Apart from the weather, one other reason that is slated to boom the business this year is the fact that China is not going to be a cheaper country now and there has been a visible shift in business to Bangladesh considering that there are not many options in India as well. While Tirupur (India) is more in jerseys, Ludhiana (India) is the only place left which is also vacating the space day by day. “We anticipate a major boom in business for sweaters within the next two months,” says Sidharth Shukla, Marketing & Merchandising Manager, of Floreal Knitwear, an offshoot of the Mauritius based CIEL Textiles, with conviction.
From heavy gauge to lighter weights…
The advent of global warming has not only brought about a change in the order quantities for sweaters, but more than that has changed the need from heavier gauges to lighter ones of 12 and 14 gauges. The summer cardigan trend has in fact opened doors for bigger demand, as these lighter weights sell throughout the year, feeling almost like a T-shirt to layer, specially sourced by Japanese buyers. “Some of our buyers call the yarns of such products as summer yarn, as they are a bit cooler, especially bought from Taiwan,” informs Zahir Rayhan, Managing Director of AsianTex Sweaters. With an annual turnover of US $ 10 million, and a production capacity of 2,00,000 pieces per month, the company deals with both basic and high fashion garments with embellishment work like embroidery, patch work, a mix of hand stitching and cut and sew as well, for buyers like JCPenney, American Eagle and Walmart. Summer yarns are mostly blended yarns with 65% rayon and 35% polyester made in one ply and two ply making it more breathable for the summer season but a little heavier than just a T-shirt.
“With the reducing orders of heavier gauge sweaters, suppliers have had to change the mix of their machines by allocating more resources to finer gauges,” adds Nahid Hasan, Managing Director of Shomahar Sweaters, which is one of the oldest sweater manufacturing companies in Bangladesh. Working with buyers like Pierre Cardin, Billabong, Gintonic, Kitaro, 3Suisses, Norpotex, Brice, Bizzbee, Bonobo, Disney, etc., the company imports its yarn from China with a setup of 815 machines of 3,5,7,10 and 12GG with a capacity of 90,000 pieces per month, so as to tap all kinds of demands.
From hand flats to Jacquards, the trend is more into automated…
Known to be a leader in sweaters worldwide primarily due to the low labour cost, the industry was until very recently operating primarily on hand flat machines, but is now shifting to an automated setup with the installation of jacquard machines. An automated computer controlled jacquard machine is rapidly replacing the existing hand flat setups, eliminating the need for repeats and symmetrical designs enabling almost infinite versatility with critical patterns. Considering that sweater making is a lot of hard work and also workers are getting better remunerations in other sectors with each passing day, labour has become scarce and costlier. “The labour cost in sweater manufacturing is also much higher than knit or woven factories due to piece rate in production and 10 hours of running. Where the worker’s daily average income was Tk 150/day in 1996 when the boom in the segment began, presently it is Tk 350/day. As an alternative, jacquard machines are replacing hand flats, seen as a promising change for the future and we are also looking at investing in these machines in the new year,” claims M.A. Rahat, Chairman of R.R. Sweaters, established in 1996 and offering medium quantities of high fashion products with a full capacity of 1,65,000 pieces per month from 815 hand flat machines in 3, 5, 7 and 12 gauges to buyers like Charles Vogele, Simon, Sonea, Metro, Republic and Lpp.
[bleft]“The summer cardigan trend has in fact opened doors for bigger demand, as these lighter weights sell throughout the year, feeling almost like a T-shirt to layer, specially sourced by Japanese buyers, also known as summer yarns.” – Zahir Rayhan Managing Director, AsianTex Sweaters
“The advent of global warming have changed the need from heavier gauges to lighter ones from 12 and 14 gauges. With the reducing orders of heavy sweaters, suppliers have had to change the mix of their machines by allocating more resources to finer gauges.” – Nahid Hasan, Managing Director, Shomahar Sweaters
“The labour cost in sweater manufacturing is higher than knit or woven factories due to piece rate in production. Jacquard machines are replacing hand flats, seen as a promising change for the future and we are also looking at investing in these machines in the new year.” – M.A. Rahat Chairman, R.R. Sweaters
“Now buyers are not only looking at basics from Bangladesh but are also seeking fashionable items, which is not always supported by hand flats. We have recently installed 235 jacquard machines from Shima Seiki.” – Habibur Rahman Manager, Merchandising and Marketing, Pretty Group
“Even though the country has a lot of opportunities for computerized machines, electricity and gas are major issues; also such a setup requires huge investments which the smaller local manufacturers would not like to step into immediately.” – Indika Samarakoon Country Manager, Brilliant Global
“For smaller sweater manufacturers working in newer markets is more beneficial as hand flats are still the accepted norm and price is the decider. Also we have seen shifting of demand to Latin America, Australia, and Russia Block.” – Shabbir Mostafa MD, Roazan Sweater[/bleft]
Buying offices are also looking to work with factories that are investing in automated solutions. The future is with automation, because fashion is changing fast and machines need to be flexible and even companies have no reservation in spending money in preparing for the future. That is the one thing that has kept Bangladesh going, the will to continuously upgrade with time.
Indeed investing in jacquards is giving the country an edge of including fashion into an otherwise basic sector. “Everybody is showing off and loving to have jacquard machines. Not big range of machines but at least 10-15 machines is something that almost every factory is looking at installing, because even the trend of jacquards is still picking up in bits and pieces and is being used to add that extra element of fashion which was missing earlier with hand flats,” adds Sidharth.
Pretty Group, which is dealing majorly in sweaters with 12 units, has recently installed 235 jacquard machines from Shima Seiki. “Now buyers are not only looking at basics from Bangladesh but are also seeking fashionable items, which is not always supported by hand flats,” says Habibur Rahman, Manager, Merchandising and Marketing of Pretty Group. The company with an annual turnover of US $ 143 million has a production capacity of 1.1 million pieces per month from 6,000 hand flats and 5,50,000 pieces per month from the newly installed jacquard machines.
Also looking at installing jacquard machines like most others is AsianTex Sweaters wanting to invest in high-end machines like Stoll and Shima Seiki. Even RR Sweaters is thinking of investing in automated machines. “Presently, we are using Hand Flat Knit machine and are certified compliant factory as per Dickies UK, but we want to offer much more and are in the process of finalizing investments into automated machines,” informs Rahat.
Even though we truly believe that the country has a lot of opportunities for computerized machines, there are some challenges as well. “Electricity and gas are major issues; also such a setup requires huge investments which the smaller local manufacturers would not like to step into immediately,” reasons Indika Samarakoon, Country Manager of Brilliant Global, originally a Hong Kong-based private label knitwear manufacturer with a majority of buyers being from the US. The company is still more focused on jacquard knitting from China. In Bangladesh the company is only trying to get a certain support in terms of jacquards, with only some parts of the sweater made in critical designs as Bangladesh is still not developed to compete in full high fashion sweaters.
Fashion Sweaters the future…
Offering high-end products like 100% merinos, 100% cashmere and blends, and lamb’s wool to prime buyers like M&S, Celio, Debenhams, Woolsworth and Calvin Klein, mostly for the men’s segment Floreal Knitwear is based in Bangladesh in order to tap the niche 10% of the industry which stands uniquely apart from the remaining 90% operating on a mass demand for acrylic and cotton sweaters. Starting operations as a buying house, today the company has 450 hand flat machines producing 1,00,000 pieces per month targeting high-end customers. “Knowing that there are very few people in Bangladesh who are producing high fashion sweaters, which is the most promising category in the future as well, the whole idea for us to come to Bangladesh is to produce sweaters in merino wools and cashmere etc. like none other; we also have machine washing facility which not all have,” says Sidharth. While the FOBs for cotton basic sweaters is US $ 6-7, the same with better finishes have an FOB of US $ 10 to 15, in Marino the range is around US $ 15, for lamb wool – US $ 10 and in Cashmere it is about US $ 90 per garment.
New Markets
With the fashioned, low gauge sweaters on the upswing new markets have been emerging. “The EU markets are currently the biggest buyers for sweaters in Bangladesh, but recent trends have seen shifting of demand to Latin America, Australia, and Russia Block,” informs Rahat. In fact, the South American market is the major buyer for Chittagong based sweater exporter Roazan Sweater. “I firmly believe that in the next five years business to Europe from Bangladesh will decline, so I have made effort to develop markets in Mexico, Peru and Chile where my exports of sweaters is around US $ 18 million and we are looking at minimum 15-20% growth in the coming year,” says Shabbir Mostafa, MD, Roazan Sweater. With 1,500 hand flat machines, the company is very upbeat of business in smaller emerging markets. “For smaller sweater manufacturers working in newer markets is more beneficial as hand flats are still the accepted norm and price is the decider,” he concludes.
