For close to five decades now, Bangladesh has been sewing clothes for the entire world. Shirts worn in New York, jeans sold in Berlin, jackets displayed in Sydney, and babywear found in London may have all started their journey in factories in Bangladesh. The country is now the second largest readymade garment exporter in the world supplying apparels to almost all global fashion retailers. Shelves in outlets of Walmart, Zara, H&M, Mango, JCPenney, Nike, Adidas, Levi's, or Harrods are incomplete with the dresses made in Bangladesh.
But there has always been a question, why a nation that stitches clothes for almost all leading brands of fashion in the world is unable to create any global fashion brand of its own? The factories manufacturing apparels with others' brand name tags earn a certain sum, whereas the brands take home a far higher chunk of the profits on account of designing, marketing, retailing and customer loyalty.
Bangladesh has become an expert in manufacturing, but it has yet to master the art of branding. This gap will matter a lot in future because the apparel industry will no longer depend upon sewing capacities.
The clothing industry has formed the basis of the country's export economy. It has employed hundreds of thousands of people and made up 80-84 per cent of its export earnings. The industry has withstood global recession, political unrest, disruption in logistics and tragedies like Rana Plaza collapse.
However, the limits of manufacturing must be understood. Every international customer negotiates on price reduction. The competition from other nations like Vietnam, India, Indonesia, and Cambodia is growing fierce. Labour costs are also increasing with workers demanding better wages and working conditions. Manufacturing purely through contract means leaving yourself vulnerable to outside decisions over which you have no control.
The preferential trade advantages favouring exports from Bangladesh will slowly reduce. Competing on the basis of cost of production alone will become harder.
Brand ownership can change that equation. For instance, when customers purchase clothing under an internationally recognised brand name, they do not only pay for the raw material or its manufacture. They pay for the trustworthiness, reputation, the creativity and design - something intangible which may be worth much more than the actual manufacture.
Bangladesh has witnessed several local fashion brands like Aarong, Yellow, Sailor, Cats Eye, Richman, and Ecstasy thriving in the local market. Some of them have gone further and entered foreign markets, albeit catering only for expatriate Bangladeshis.
But being a globally recognised brand is something more. Being a global fashion brand involves developing a consistently excellent product line, designing world-class products, marketing aggressively and having efficient logistics management and a good retail network in several countries. It also involves making a lot of long-term investment with no assurances of quick profits.
Local entrepreneurs are hesitant to take this risk. They find it safe and lucrative to go for contract manufacturing because orders come from established international clients who pay just after a factory manufactures their goods.
The government needs to play a key role in emergence of local manufactures as established global brands. For many years now, the support of the government has helped make the country's apparel sector an export leader. The same kind of support can now be offered to outfits that aim to launch their own brands in foreign markets. This can be done through launching export incentive schemes, participating in foreign fashion shows, offering support for intellectual property rights and ensuring favourable finance.
Bangladesh boasting the highest number of green apparel factories in the world presents a golden opportunity. It is because consumers worldwide now place importance on eco-friendly production, sustainable sourcing and responsible labour practices. A Bangladeshi brand having these qualities would remain ahead of others competing globally.
The "Made in Bangladesh" label is now found on clothes sold in almost all global markets. The next thing should be customers' preference for clothes made by Bangladeshi brands on the basis of their high standards, good designs and the values they represent.
This may not happen right away as it usually takes decades to create a reputable brand abroad. Not all ventures may succeed but some will attain the standard benchmark.
