Buyers lead knitwear manufacturers in Bangladesh to integrate production units

Increased pressure from brands and buyers are pushing Bangladeshi knitwear manufacturers to integrate their existing composite units with more facilities, this was stated in a report published a Bangladesh newspaper recently.

“After the Tazreen and Rana Plaza building collapse, buyers are more conscious about the safety and compliance issues…The renowned brands and retailers now prefer their sourcing units to have more integrated facilities like washing, printing and embroidery on either the same premise or under single- ownership mainly to ensure compliance in their whole supply chain,” stated a knitwear manufacturer, while another one went on to underline, “Many more are planning to invest millions of Taka to add such facilities, while some have already invested,” adding, “It helps buyers trace and ensure all safety and other requirements if all the units are on one premise or surrounding areas or have same ownership.”

Also Read – Pakistan Knitwear Exports Fall in Value Terms

It may be mentioned here that composite units are the ones that have their own knitting, dying, sewing and finishing facilities. Such units are considered to be one of the main strengths of the knitwear sector that sources more than 90 per cent of fabrics from the local market. The number of such units, according to insiders ranges between 400 – 500 and reportedly contributing almost cent percent in value additions as they majorly source fabric locally.

Also Read –  Bangladesh exports more woven apparels than knitwear in FY 2014-15

According to the data of Export Promotion Bureau (EPB), knit sector has been the largest foreign currency earner for the country since financial year of 2007-08, which however was surpassed by woven in FY 2012-13. The EPB also underlined that in the last fiscal, knitwear sector fetched US$12.42 billion, while woven accounted for US$13.06 billion. Exported mainly to the European Union (70 per cent of the total knitwear exports), about 10 per cent to the US, and more than three per cent to Canada (according to BKMEA), knitwear accounted for US$8.64 billion earnings in the first 8 months of the current financial year while earnings from woven was at US$9.48 billion.