Apparel exporters are intensifying manufacturing activities to address recent production disruptions caused by labor challenges and restrictions over the past three months. These disruptions have significantly impacted the industry’s ability to fulfill orders for the upcoming Christmas season and secure contracts for autumn and winter collections. To compensate for lost production time during July, August, and September, which are critical months for completing Western orders, factories are operating around the clock. Local exporters are collaborating with subcontractors to help navigate these challenges and are seeking extensions from their partners to ensure timely deliveries.
According to CareEdge Ratings, approximately 10% of Bangladesh’s ready-made garment (RMG) export orders could shift to competing markets such as Vietnam and India if the situation persists for an extended period. Exporters are concerned that production delays may force them to offer significant discounts or resort to costly air freight for deliveries. For instance, the cost of air freight from Dhaka to Europe for one kilogram of dry cargo can reach $4, while marine freight costs less than 10 cents per kilogram. Khandoker Rafiqul Islam, president of the Bangladesh Garment Manufacturers and Exporters Association, announced plans to meet with major brands and retailers to discuss the current state of the industry. While consumers are demanding quick deliveries, no work orders have been canceled so far. However, the recent disruptions have resulted in over $100 million in damages to the apparel industry due to production and shipment delays, as well as postponed factory inspections.
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