Even though the apex trade body is representing the country’s largest export-earning sector, a significant number of small and medium-sized ready-made garment (RMG) factories remain outside the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
Industry insiders have cited financial, procedural and policy-related challenges as key reasons for non-membership.
Giant Group Managing Director Farooq Hassan told this correspondent, “Many of these factories either lack direct export licences or operate solely as subcontractors for larger member factories, disqualifying them from becoming members of BGMEA. For many, the process of becoming a member particularly fulfilling documentation, licensing requirements and compliance standards is considered complex, costly and burdensome.”
BGMEA membership requires factories to comply with a series of regulations, including safety standards, environmental audits, wage compliance, and proper documentation of trade licences and bank solvency. While these requirements are crucial for sustainability and reputation, they often pose financial and logistical burdens for smaller units.
“Many small factories work as subcontractors. They don’t deal with buyers directly and don’t see immediate value in being a BGMEA member. Moreover, compliance upgrades such as fire safety systems or green building certifications, demand for significant investment that many small factories simply cannot afford,” said Farooq Hassan, also former president of BGMEA.
In addition, some owners argue that recurring membership fees and lack of policy inclusion leave smaller factories underrepresented in BGMEA’s high-level decision-making structure, where large exporters often dominate.
According to BGMEA data, 128 new factories joined BGMEA as members from January 2024 to March 2025. During the same period, 113 BGMEA member factories shut down operations, leaving 96,104 workers jobless. Of them, 69 factories were closed after August 2024 alone.
While talking about closed factories, Managing Director of Chaity Group Mohammad Abul Kalam at a press conference said, “We don’t want any factory closure. Due to unavoidable circumstances, garment factories are often shut down. As a good number of factories have been laid-off, we will help them resume operations.”
Kalam further said, “SME entrepreneurs play a crucial role in the industry. About 630 small and medium-sized industrial factories have closed due to various reasons like financial crisis, workers’ dissatisfaction and employment crisis. If we win the elections and take charge, we will work for rehabilitation on priority basis. However, only those who have factories will get priority.”
Despite these concerns, BGMEA membership brings undeniable advantages. It is a prerequisite for direct exports, enabling access to customs and export documentation, duty-free certificates under the Generalized System of Preferences (GSP), and various trade benefits under bilateral and multilateral agreements. The association also offers legal support, industry training, and facilitates engagement with government and international stakeholders.
Non-member factories often lack institutional backing, which puts them at a disadvantage during labor disputes, regulatory inspections, or financial negotiations with banks and buyers. During crises like the COVID-19 pandemic, many of these factories were reportedly excluded from stimulus packages or government aid channelled through BGMEA.
Furthermore, without being under BGMEA oversight, non-member factories often fail to meet global compliance standards. In an era of increasing demand for ethical and transparent sourcing, such gaps can drive international buyers away.
“There is a huge informal base in our garment sector that still contributes significantly to production. Ignoring them weakens the entire supply chain. Bringing them under the formal umbrella through a practical, inclusive approach will benefit the entire industry,” said a former BGMEA president and trade policy expert.
As of December 2024, there are approximately 3,555 ready-made garment (RMG) factories in the country, according to Mapped in Bangladesh (MiB) project. Among these, about 2,720 factories are members of either BGMEA or Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA). It means that approximately 835 factories are not affiliated either with BGMEA or BKMEA.
