Business

‘Strong negotiation needed with buyers to get fair prices of RMG’


Published : 05 Jan 2022 09:56 PM | Updated : 05 Jan 2022 09:56 PM

Apparel makers should strongly negotiate with their buyers to get fair price of locally made garment items as they are yet to raise the rate of CM (cost and making) despite a rise in overall unit prices.

“Both quantity and unit prices of apparel items have increased in recent months but we are unable to raise the CM rate,” Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president Faruque Hassan said on Wednesday.

The unit prices have increased mainly because of the high prices of inputs or raw materials like cotton, yarn and other logistic costs like freight charges, he explained.

“But still the prices of apparel items are not increased in line with the raw materials’ prices,” he said while addressing the dialogue organized by Economic Reporters’ Forum (ERF) at its office in the city.

He called on apparel exporters to effectively negotiate with buyers in time of taking work orders and added that a joint committee has been formed recently by BGMEA and Bangladesh Knitwear Manufactures and Exporters Association (BKMEA) to set a minimum price benchmark so that they get fair prices from buyers and stop unhealthy competition among local exporters.

ERF general secretary S M Rashidul Islam moderated the dialogue while its vice president Shafiqul Alam also spoke.

Responding to a question, the BGMEA president said still date there is nothing to be worried over Omicron saying no work orders have been canceled.

Few buyers from European Union have asked to delay delivery ranging seven to ten days, he said.

Answering another question, he said they are concern over the US sanctions imposed on Rab and some of its officials and added that it might not affect the garment trade.

“US is the single largest export destination for local readymade garment (RMG) and export is increasing there too,” he said adding Bangladesh has implemented all the conditions of Generalized System of Preferences (GSP) though RMG never enjoys GSP facility in US market.

Mr Faruque Hassan during his speech explained about the measures including skill development, attract investment and both market and product diversification taken by the government and the industry to face the post-graduation challenges.

The BGMEA president, however, without going details alleged that they are facing some difficulties related to customs and National Board of Revenue.

“I don’t want to go details of the issues related to NBR as we sit shortly to address those,” he noted.

The BGMEA chief also said that they publish the accurate number of garment factories and the workers the sector has been employing within next three months and added that non-member factories will gradually be brought under one umbrella to ensure safety and other compliances.