It’s not very often that one hears of a global biggie expanding its footprints in Bangladesh, more so when upcoming manufacturing hubs like Ethiopia are hogging all the limelight at the back of diverse advantages that it reportedly enjoys over others, thereby enticing many to set up their plants in Ethiopia, including some prominent names from Bangladesh as well.
However, Montreal-based Gildan Activewear Inc. seems to be an exception. The company which manufactures and markets activewear products (including T-shirts, fleece tops and bottoms, sport shirts, dresses, casualwear, workwear, liner, therapeutic socks and many more) in North America, Europe, Asia-Pacific and Latin America, has reportedly decided to expand its footprints in Bangladesh by building a large complex to complement its existing operations in the country and in Central America and the Caribbean.
The announcement in this direction was made when the company recently unveiled its financial report (as per which, its net income for the three months ended March 31 decreased to US $ 22.7 million or 11 cents per diluted share, from US $ 67.9 million or 31 cents per share a year earlier).
“The company believes the buildout of a large-scale manufacturing hub in south-east Asia will significantly enhance its positioning to service international markets and support other key sales growth drivers,” underlined Gildan in a news release.
As per media reports, Gildan reportedly purchased a large land parcel recently for US $ 45 million to build a vertically integrated manufacturing plant that would expand its textile and sewing operations.
To be operational by 2021, Gildan’s multi-plant complex would be large enough to reportedly support more than US $ 500 million in annual sales.
It may be mentioned here that Gildan has a vertically integrated unit (GAB Limited) located at Palashbari, Ashulia, with knitting, dyeing, finishing, cutting and sewing facilities.
It was in 2010 that Gildan first hit the headlines in Bangladesh when it announced the acquisition of Shahriyar Fabric Industries Limited (Shahriyar), for a total purchase price of approximately US $ 15 million.
Shahriyar owned and operated a vertically integrated knitting, dyeing, finishing, cutting and sewing facility for high-quality ring-spun T-shirts with an annual T-shirt production capacity of 2.2 million dozens.
The company then maintained that the acquisition of Shahriyar is the end-result of substantial analysis carried out to identify a strategic location to begin the development over time of a potential major vertically integrated manufacturing hub in Asia with an infrastructure and geographical location to position Gildan as a low-cost, high-quality producer to serve its target markets.
Now with the new multi-plant complex expected to be operational in the next couple of years, Gildan’s plans to better serve its target markets would get a further fillip.
It may be mentioned here that Gildan is not the only global entity to strengthen its position in Bangladesh. There are several big names from many countries which are operating successfully in Bangladesh for many years now.
Sri Lanka’s MAS Holdings Limited (which manages a portfolio of businesses with revenue of US $ 1.8 billion and is positioned as one of the world’s most recognised design to delivery solution providers in the realm of apparel and textile manufacturing) has a very modern lingerie manufacturing unit (MAS Intimates Bangladesh Private Limited) located at Karnaphuli Export Processing Zone, in Chittagong.
Hop Lun Apparels Ltd. of Korea is another big name to have its manufacturing unit in Bangladesh.
Going by the present trend and the so-called pro-business approach of the incumbent Government, under which foreign investments have increased significantly in last few years, it would not be a surprise if Bangladesh emerges as a popular destination for setting up of apparel manufacturing units by renowned global entities in the coming days.