SWOT-analysis: RMG sector of Bangladesh

 

SWOT-analysis: RMG sector of Bangladesh

 

A SWOT Analysis of RMG sector of Bangladesh is presented below;

 

 Strength:

-      Competitive price advantages due to cheap labour and governmental assistance.

-      Skilled human resources

-      Duty and quota-free access and GSP in EU

-      Integrated supply chain, specially in knitwear

-      International image of a reliable supplier of basic products.

 

Weakness:

-      Weak structures, in particular regarding production efficiency, product development, marketing skill, customer service, controlling, planning, management skill and technical know how.

-      Producing mainly basic products that are competitive disadvantages to other countries.

-      Heavily depend on importing woven fabrics, low value addition

-      Poor image of adapting different international and corporate social standards.

-      Political, social and worker unrest.

-      Interrupted utility supply.

 

 

 

Opportunities:

-      Potential for higher value addition provided appropriate steps concerning development of backward linkage.

-      Strong backward linkage, infrastructure of transportations of goods, faster custom clearance will reduce lead time.

-      Improve image by adapting environmental and social standards.

-      Diversifying of apparel product, i.e., switching from basic product to fashionable and decorative products.

-      As a LDC, may get preferences in the market of the USA and Canada in near future.

 

Threats:

-      Risk of loosing competitive advantages on international market if manufacturing companies do not take development steps.

-      Poor political and investment climate, causing declined interest of importers in supply from Bangladesh.

-      Poor capital formation that abstain Bangladesh from investing backward linkage.

-      Risk of loosing the opportunity of know-how transfer, staff qualification and education in cooperation with international customers.

-      Bangladesh does produce neither natural fiber nor man made fiber; totally depend on others for raw material.

-      Increasing international competition concerning Cut and Make (CM) and Full price business mainly from Far eastern countries and east European countries.