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79% RMG buyers yet to increase product price: Survey

Staff Correspondent
30 Jan 2024 21:44:03 | Update: 30 Jan 2024 21:44:03
79% RMG buyers yet to increase product price: Survey
— TBP File Photo

Although Bangladesh’s apparel sector implemented new wage structure in December last year and buyers committed themselves to adjusting increased cost, 79.1 per cent of readymade garment makers said that their buyers are yet to increase product price.

Only 3 per cent buyers increased product price up to 5 per cent, said a survey conducted by Forum, a panel of Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

Forum panel leader Faisal Samad, also director of BGMEA, revealed the findings of the survey titled “Garment Industries' Crucible: Our views” at a club in the capital on Tuesday.

The survey was conducted on 66 RMG makers.

According to the survey, 4.5 per cent buyers increased product price by 1 per cent, 6 per cent by 2 per cent, 3 per cent by 3 per cent and 4.5 per cent by 4 per cent.

In 2023, 32.8 per cent apparel manufacturers said that their customs and bond expense increased by 26-50 per cent year-on-year. Besides, 26.6 per cent RMG makers said that their customs and bond cost rose by up to 25 per cent, 20.3 per cent said the cost increased by 51-75 per cent, 6.3 per cent said the cost was up by 76-100 per cent and 11.8 per cent said that their cost jumped by over 100 per cent year-on-year.

The survey showed that last year average 3.9 per cent FoB price declined year-on-year amid high inflation, and 47.1 per cent manufacturers said that buyers reduced FoB price by over 5 per cent year-on-year.

It also said that only 19.1 per cent of the factories were able to manage hundred per cent orders for the next four months, while 42.6 per cent claimed that they had less than 50 per cent orders during the period compared to their capacity.

Faisal Samad said, “Due to the global economic crisis, our RMG industry is suffering. Such kind of survey helps find out the real scenario. During the Covid-19 pandemic, BGMEA conducted a survey. Primarily, manufacturers felt hesitation to participate in the survey.”

“But when we were able to do the job, the government issued 14 circulars based on the survey. It helped us to come back.”

The former BGMEA Vice President said, “We have a lot of chances to increase exports to USA through reduced tax. We are using their cotton, and we may negotiate with them that if you reduce import tax on your cotton-based clothes, your cotton exports to Bangladesh will increase.”

“Our exports to US will also rise. If I become president, I will work for this,” he added.