The coronavirus pandemic has changed many a thing world-over! Even as vaccination against the dreaded virus has already rolled out in many countries globally, many experts believe social distancing is still going to be the norm in the changed world order and so would perhaps be the digital marketplaces.
Given the existing scenario, garment makers in Bangladesh — Bangladesh is a powerhouse in the realm of apparel manufacturing and exports, second only to China — have not only proposed to come up with a virtual marketplace, they have also sought help from the Government (both in terms of policy support and financial aid) to materialise the same.
To start with, it all begun consequent to the largescale order cancellations by the global buyers last year, which led the apparel sector leaders to come up with the idea of developing a virtual market platform mainly to dispose of apparel items, cancelled by brands and retailers owing to the pandemic. The apex garment makers’ body in the country – the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) – thus put forth a set of proposals to the Government including the necessity of developing the country’s own virtual market platform, to help the sector effectively deal with the fallouts of the COVID-19 pandemic.
Speaking to the media then, the erstwhile president of the garment makers’ body, Dr. Rubana Huq said the industry was plagued by mass order cancellations as 1,150 factories reported that global buyers cancelled orders worth US $ 3.08 billion.
Since the factories have stocks of billions of dollar worth of goods being cancelled by buyers that needs to be disposed of in the most feasible manner, while the COVID-19 will significantly shift the world market from bricks-and-mortars to e-tailing, we feel the necessity of Bangladesh’s own virtual marketplace platform, stated Dr. Rubana.
Not stopping at that, the BGMEA also demanded fund allocation in the next budget for creating a global platform, like Amazon, eBay and Alibaba, so that Bangladesh can export clothes of local brands to the international market while underlining that such an online platform will help garment manufacturers to deliver products directly to foreign buyers through individual shopping portals even as the BGMEA also expressed interest to sell garments of local brands at the retail level outside the country through the online platform while also suggesting various remedial measures to help the industry come out of the pandemic glut, some of which were like waiver of interest against loans, fund allocation for health and education of garment workers, incentives to help the sector deal with Covid impacts and 10 per cent cash incentives for the next 10 years for exporting garments and in recycling textile waste to produce fashion items.
Before making her exit as the BGMEA President, Dr. Rubana in the budgetary proposal (for the fiscal 2021-22) sent to Finance Minister AHM Mustafa Kamal underlined the global market was inclining towards online sales and the ongoing trend indicated a rise in online purchases in future.
“While we are trying to recover from the shock, the second wave disrupted the retail market and demand causing a slowdown in exports and a continued downward pressure on price. This also means underutilisation of capacity leading to increased marginal cost,” maintained Dr. Rubana then while pointing out that the detection of the new strain of the coronavirus and how the declining retail sales in both the USA and the EU caused the garment sector to lose 2.87 per cent-unit value in 2020 (the decline was recorded at 4.26 per cent between September 2020 and February 2021).
The BGMEA had said it had already taken the initiative to open business-to-business (B2B) and business-to-consumer (B2C) portals and to implement a project to establish its own platform on the virtual marketplace for which it sought an allocation of Taka 100 crore in the next budget even as it also wanted an opportunity to send 10 per cent of the export earnings abroad so that Bangladeshi garment manufacturers can operate outside the country for brand development and marketing.
It may be mentioned here that apart from the BGMEA, some individual players have been actively pursuing establishing online platforms to connect with garment buyers, sellers and one such name is the Merchant Bay, which is a subsidiary of a leading garment exporting company Sayem Group, which launched its online platform for trading garment items and help international suppliers and retailers meet exporters directly and facilitate verification of work orders digitally, last year.
Dr. Rubana Huq, the then president of BGMEA at the launch of the platform earlier had maintained that virtual transactions and e-commerce are the new reality in business as these work as one-stop service centres even as Shafiul Islam Mohiuddin, the former president of the BGMEA and the Federation of Bangladesh Chambers of Commerce and Industry, said the presence of customers in stores of Western retailers and brands was low still but there has been a boom in online sales as consumers prefer buying goods while staying within their homes.
We need to reach our goods to our consumers through online platforms as their behaviours also changed a lot, Shafiul Islam Mohiuddin added then.
Now with the BGMEA actively pursuing the idea of establishing a virtual marketplace even as there has been a change in the leadership of the trade body following the latest biennial election as part of which Faruque Hassan took over the reins from Dr. Rubana Huq, if the trade body could establish the same and manage to garner the required fiscal and policy support from the Government to materialise the idea of the virtual marketplace, which many in the industry believe will help the garment manufacturers a great deal in these trying times, is yet to be seen.