...How can Transaction Cost Economics Theory be used to help Bangladesh's Government save their Garment Industry? Daryl Chen California Baptist University Abstract Bangladesh is one of the developing countries of the South Asian region, with the population near about 122 million. The country's main export sector is in the garment industry. In 2010, the country decided to raise the minimum wage due to the public's outcry of unfair wages and working conditions. In this research paper, we will look at how the increase of minimum wage has affected the country's economy and what could be done to improve the outcome. Introduction Bangladesh is one of the developing countries of the South Asian region, with the population near about 122 million. Many of the 122 million are garment factory workers whose incomes rely on the garment industry growth and the ability to offer cheaper costs than other countries in the world. Bangladesh is a developing country, which would be consider by most as an old terminology, a third world country, and it's Ready Made Garments (RMG) sector of the textile industry has been known as the biggest earner as an export and the foreign currencies that come as the result of it. The country's Gross Domestic Product (GDP) is greatly contributed by its textile industry. In 2010, the country raised the minimum wage. The fallout was the unforeseen result and halted the country's growing economy. The country's export...
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...However, Vinatex and Ha-meem are way ahead in terms of garment manufacturing. This is in line with the aforementioned fact that Vietnam and Bangladesh are denting India’s share in the export of garments. In fact, Vinatex displayed the highest efficiency in terms of annual capacity per manufacturing plant, the figures stood at 13.6 million pieces. The firm will invest $240 million in fibre, fabric and garment development to further strengthen its production capacities in 2017. Furthermore, as Ha-meem is a renowned apparels name in America and Europe, it will soon venture into knitted products and capitalize on the economies of...
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...A SWOT Analysis on RMG Sector in Bangladesh RMG is the leading industry in Bangladesh. It is basically a labor-intensive industry and it needs limited financial investment and relatively simple technology compared to other high technical industries. The success story of Garment Industry in Bangladesh is the story as to how the readymade garments starting in the late seventies as an insignificant non-traditional item of export. In 1998-99 this sector has earned 4019.98 million US$ through exporting which is 75.67% of the total export. The tremendous success of Readymade Garment (RMG) exports from Bangladesh over last two decades has surpassed the most optimistic expectations. At present Bangladesh is the 6th largest exporter to USA and in 1997 Bangladesh becomes 18th largest exporter in the world. Now Bangladesh ranks first export of T-shirts to Europe (BGMEA, 1997-98). The overall impact of the readymade garment export industry is certainly one of the most significant social end economic developments in contemporary Bangladesh. The remarkable achievement of RMG sector is now exposed to each and every country. Despite these impressive achievements and the probable challenges in the near future, if properly managed, the prospects for further expansion and growth for this sector remain bright. There are some major threats still exits in this sector but Bangladesh has the ability to overcome these threats. Readymade Garment (RMG) industry holds a key position in the...
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...EXECUTIVE SUMMARY Readymade Garments Industry is the leading foreign currency earning sectors of Bangladesh. Now-a-days Bangladesh financial sector is very much dependent upon this sector. The annual export income of garments sector is driven from two sources one is woven garments and others is knit wear. Redimet garments is a 100% export oriented garments. Redimet garments exports various garments product in foreign market. The company makes shirts, ladies dress, shorts, trousers, and others for U.S.A, U.K, Europian countries countries. They use high tech machineries to produce a quality garments product. They also add new machineries to increase their production line. They have a mission and the vision is profit maximization. The merchandising philosophy of Redimet garments is to keep good relation with their buyers. The garments Industry maintains a good relationship with every buyer. Hard working and commitment maintenance is their main strategy. They always try to satisfy their buyers. In this perspective the merchandiser always try to do their merchandising activities in due time. The merchandiser of this company is not very much skilled person. More over him has no assistant. For this reason Sometimes the company face problem. So, here Redimet garments can recruit high skilled people with giving high salary. The Redimet garments should improve their product quality, packing system, internal environment, and other merchandising activities to satisfy their foreign buyers...
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...archive [Online] 22.03.2012) Sainsbury’s launched its TU fashion range in 2004, and is now housed in over 300 stores nationwide. Over the past six years, the retailer has seen its share of the £9.9bn value fashion market more than treble. The TU clothing range remains the UK’s seventh largest clothing brand by volume, TU kidswear however has gone from seventh place in 2011 to the UK’s sixth largest in 2012. (Drappers online, 2012, Sainsbury’s expected to reveal further gains in clothing market share. [Online] 22.03.2012) The Sainsbury’s TU clothing distribution centres are located in, Coventry, Warwickshire and Bedford, Bedfordshire. Sainsbury’s also have a deport in Buntingford Hertfordshire. This deport however isn’t usually in operation, but the site is still owned by Sainsbury’s and is often used at busy times, particularly at Christmas. Originally Sainsbury’s ran its own distribution network. However after an industrial dispute...
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...21st century into opportunities to create value for business and society. Our Center for Business and Human Rights is the embodiment of that mission. By creating a safe haven for open dialogue and convening relevant voices for discussion around practical solutions to some of the world’s most pressing problems, the Center, and by extension this report, demonstrate that profit and principle can co-exist. ” –Peter Henry, Dean NYU Stern School of Business Dean Henry launched the Center for Business and Human Rights in March 2013 with a strong belief in the power of business to create positive change in society. In that spirit, the Center’s mission is to challenge and empower businesses to make practical progress on human rights in their own operations. It is the first center to focus on human rights as an integral part of a business school. We start from the premise that business can and does work for the good of society. We support the goal of business to create value while emphasizing high standards for human rights performance. Each year, we take on a major project around a set of human rights challenges in a sector that is of foremost concern for companies, consumers, regulators, and investors. We use the convening platform of the NYU Stern School of Business to bring together groups of companies from different sectors and different parts of the world, along with outside stakeholders and experts. We devote significant attention and resources to ensuring that the Center provides...
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...1. Introduction After independence in 1971, Bangladesh moved to a private sector led export oriented economy in late 1970’s from a highly protected government led economy in search of prosperity and growth. Even though there was little growth and development in the country as a whole; one particular sector, the Readymade Garment (RMG) industry was the beneficiary of privatization. From 0.2 percent in 1980’s, it came to 75 percent in 2004-05 of country’s total export. This industry employs 1.8 million people of whom 90 percent are women. Trade liberalization as a form of globalization followed by the imposition of quotas by US was the key input while entrepreneurs played the anchor role to take advantage of these conditions. Government also came forward with favourable policies for further growth. However, the quota oriented worldwide apparel trade came to an end on December 2004. What is going to happen in the Bangladesh apparel industry, which was predicted to lose its stake in an open market? This dissertation aims to discover the condition of the apparel industry as a whole at present and how the firms adjust to the situation with their internal rearrangement. Additionally, issues considered as vital for industry’s growth, such as infrastructure, information technology in the form of database, internet and software, and capacity building will be discussed. The dissertation starts with the global picture of apparel trade, and with a brief description how this trade...
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...A Study of Nike’s Operations in Bangladesh Through a PESTLE Analysis Sarah Seward-Langdon Xi’an Jiaotong-Liverpool University MAN311 Business in the Asia-Pacific Region Dr. Donald Pak October 30, 2015 Word Count: 3,215 Table of Contents Executive SummaryIntroduction of Bangladesh PESTLE Analysis of Bangladesh Political Situation Economical Situation Social Situation Technological Situation Legal Situation Environmental SituationIntroduction of NikeNike AnalysisMini-SWOTNike in Relation to Bangladesh PESTLE AnalysisConclusionReferences | 344467789101111121416 | Executive Summary The Asia-Pacific region is a diverse and growing area spanning approximately 28,000 square kilometers worldwide (Lane and Waggener, 1997). Countries such as China, Japan, and South Korea have seen unprecedented growth in recent history and are now part of the top 15 world economies (Central Intelligence Agency, 2015). Although which countries are considered part of the region is heavily controversial, many professionals agree that it is one of the most promising areas for business investments. This paper aims to provide a deeper insight into one of the still impoverished countries in the Asia-Pacific region: Bangladesh. After a short introduction of Bangladesh, an in-depth PESTLE analysis will be done on the country’s situation. Before corporations decide to invest in a country, it is extremely important to have all the facts. Through a PESTLE interpretation, the advantages and disadvantages of...
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...Development of Apparel Industry in Bangladesh Garment Industry Large-scale production of readymade garments (RMG) in organised factories is a relatively new phenomenon in Bangladesh. Until early sixties, individual tailors made garments as per specifications provided by individual customers who supplied the fabrics. The domestic market for readymade garment, excepting children wears and men's knit underwear (genji) was virtually non-existent in Bangladesh until the sixties. Since the late 1970s, the RMG industry started developing in Bangladesh primarily as an export-oriented industry although, the domestic market for RMG has been increasing fast due to increase in personal disposable income and change in life style. The sector rapidly attained high importance in terms of employment, foreign exchange earnings and its contribution to GDP. In 1999, the industry employed directly more than 1.4 million workers, about 80% of whom were female. With the growth of RMG industry, linkage industries supplying fabrics, yarns, accessories, packaging materials, etc. have also expanded. In addition, demand for services like transportation, banking, shipping and insurance has increased. All these have created additional employment. The total indirect employment created by the RMG industry in Bangladesh is estimated to be some 200,000 workers. In addition to its economic contribution, the expansion of the RMG industry has caused noticeable social changes by bringing more than 1.12 million...
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...The tremendous success of readymade garment exports from Bangladesh over the last two decades has surpassed the most optimistic expectations. Today the apparel export sector is a multi-billion-dollar manufacturing and export industry in the country. The overall impact of the readymade garment exports is certainly one of the most significant social and economic developments in contemporary Bangladesh. With over one and a half million women workers employed in semi-skilled and skilled jobs producing clothing for exports, the development of the apparel export industry has had far-reaching implications for the society and economy of Bangladesh. Literature Review: Several authors have analyzed aspects of the garment industry in Bangladesh. Of the various aspects of the industry, the problems and the working conditions of female workers have received the greatest attention. There are several studies including the Bangladesh Institute of Development Studies (BIDS) study by Salma Chowdhury and Protima Mazumdar (1991) and the Bangladesh Unnayan Parisad (1990) study on this topic. Both of these studies use accepted survey and research methodology to analyze a wealth of data on the social and economic background, problems and prospects of female workers in the RMG sector. Professor Muzaffar Ahmad looks at the industrial organization of the sector and discusses robustness and long-term viability of apparel manufacturing in Bangladesh. Wiigton (2000) provides a good overview of this...
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...Report On “News Paper Article of Business Environment of Bangladesh” Submitted To: Dr. Akbar Ali Khan Professor Environment & Business (Bus 503-1) MBA programme BRAC Business School BRAC University Submitted By: Anika Zaber (13164108) Sharmila Gupta (13164121) Joynub Sultana (11164034) Shabnam Alam (13364086) Date of Submission: 29 July2013 Letter of Transmittal 29 July 2013 Dr. Akbar Ali Khan Professor Environment & Business MBA Programme BRAC University Subject: Submission of report on news paper article Dear Sir We have prepared a Group Report on “Newspaper article of Business Environment of Bangladesh” which we are submitting along with this letter. It was a delightful experience and preparing this report further enhanced my insight about how to prepare a report. We are confident that this report will help you to understand the reason about our selection of the articles. We have tried our best to follow your guidelines in preparing this report. We have presented what we believe to be most important information to make our report as specific & coherent as possible. We hope that this report will fulfill your requirements. Thank you for your kind consideration and guidance. We hope our effort would satisfy you. Sincerely yours Anika Zaber (13164108)...
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...Current State of Textile Industries in Bangladesh Introduction: The textile and clothing sector is the largest manufacturing activity in Bangladesh. It provides direct employment to about than 5 million people, which accounts for 45 per cent of all industrial employment in the country. The sector contributes 10 per cent of the country’s GDP, 40 per cent of industrial value addition, and 78 per cent of export earnings. Major readymade garments exported by Bangladesh are knitted and woven shirts and blouses, trousers, skirts, shorts, jackets, sweaters and sportswear, and other fashion apparel. In the Table below provides a profile of Bangladesh’s textile and clothing sector. The sector can broadly be divided into primary textile sector (PTS) and export-oriented readymade garment (RMG) making sector. The PTS comprises spinning, weaving, and specialized textile units, traditional handloom sector and knitting and dyeing subsectors. Currently, there are now 350 spinning mills, 400 weaving firms, 310 dyeing and finishing units, and 4,500 garment factories. |Sub-sector |Number of units |Installed machine capacity |Production capacity |Employment | | | | | | | |Textile spinning |350 7.5 million |spindles |1...
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...Bangladesh – German Development Cooperation PROGRESS House 10C, Road 90, Gulshan 2, Dhaka 1212, Bangladesh Tel: +880 2 9887567, Fax: +880 2 8813769 E-mail: progress@gtz.de,[->0] Websites: www.gtz.de[->1], www.gtz-progress.org[->2] Working Paper No – 6 A COMPARATIVE ANALYSIS BETWEEN THE BANGLADESH LABOR LAW 2006 AND 7 GENERAL CODES OF CONDUCT By Ameena Chowdhury Hanna Denecke Dhaka, October 21, 2007 PROGRESS (promotion of social, environmental and production standards in the ready-made garment sector) is a joint program of the Bangladesh Ministry of Commerce and the German Federal Ministry of Economic Cooperation and Development (BMZ), implemented by GTZ. Executive Summary The Readymade Garment (RMG) sector in Bangladesh is a highly export oriented sector and therefore extremely volatile to requirements of international buyers. Since the adherence to international social standards has become a mandatory requirement in the international business arena, the local suppliers have to be compliant to these standards in order to remain in business. There have been some significant revisions to the Bangladesh Labor Law in 2006. This newly revised law already covers a lot of the common standards like employment conditions, occupational health and safety issues as well as the ILO core labor standards. Besides being complaint...
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...FIRST DRAFT RISE OF READYMADE GARMENTS INDUSTRY IN BANGLADESH: ENTREPRENEURIAL INGENUITY OR PUBLIC POLICY by MOHAMMED ALI RASHID Professor of Economics North South University Paper presented at the Workshop on Governance and Development organized by the World Bank and BIDS at Dhaka on 11-12 November 2006 I. INTRODUCTION The 100 percent export-oriented readymade garments (RMG) industry of Bangladesh has witnessed remarkable growth since its inception in the late 1970s. Paradoxically, this flagship industry of Bangladeshi private entrepreneurial talent took roots through the first export consignment of shirts from Bangladesh made by the state-trading agency, the Trading Corporation of Bangladesh (TCB), in the mid-1970s under countertrade arrangements and the destination was some East European countries. Subsequently, however, private entrepreneurs entered the industry and phenomenal growth took place in RMG exports from Bangladesh. Export of RMG increased from US $40 thousand in 1978 –79 to US $6.4 billion in 2004-05. The industry has also provided employment to nearly 2 million workers, most of them women drawn from the rural areas. Explosive growth of RMG exports is of course not unique to Bangladesh. The annual compound growth rate of RMG export industries in Indonesia (31.2%), Mauritius (23.8%), and Dominican Republic (21.1%) compares favourably with that of Bangladesh 1 (81.3%) over the 1980-87 period . However, while initial conditions were favourable for export...
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...Sector of Bangladesh: Is this an Outcome of Poor Labour Practices? Chowdhury Golam Hossan (Corresponding author) Assistant Professor of Management College of Business Administrations, Abu Dhabi University Abu Dhabi, UAE Tel: 972-501-5710 E-mail: Chowdhury.Hossan@adu.ac.ae Md. Atiqur Rahman Sarker (Lecturer) Department of Business Administration, East West University 43 Mohakhali, Dhaka 1212, Bangladesh Tel: 88-017-4427-0243 E-mail: mars@ewubd.edu Rumana Afroze (Lecturer) Department of Business Administration, East West University 43 Mohakhali, Dhaka 1212, Bangladesh Tel: 880-181-888-3767 Received: July 2, 2011 doi:10.5539/ijbm.v7n3p206 Abstract The RMG sector of Bangladesh has experienced disputes and violent protest by the workers in recent times. This study explores the reasons for recent unrest in the garment sector. Since managers are mainly responsible for applying human resource practices, this paper has given particular attention to their views on recent attitude changes of workers. Results show that mutual understanding among workers and managers is absent in the RMG sector. This study also states that high-work load, poor behaviour of line managers, low skills and low wage rates are the notable reasons for high job turnover and social unrest. Poor relationship between workers and supervisors is the main source of conflict. This study finds that there is growing demand for work life balance among the workers of RMG sector. Keywords: Bangladesh, Readymade garment sector...
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