The RMG industry of Bangladesh has solidified its position as the second-largest apparel exporter globally, said a BGMEA handout on Thursday.
‘Yet the sector faces crossroads one after the other. The disruption in global fashion retailing and distribution caused by digital technologies and application is both a challenge and opportunity for us’, the handout added.
The statement mentions in this age of virtual connectivity, people of all age, particularly Gen-Z, are spending more time in virtual world. Here’s what fashion and luxury players need to know about this emerging frontier.
For the fashion industry, it has created new opportunities as consumers since consumers are increasingly inclining toward digital shopping.“In fact, we have well realized the significance of the virtual marketplace during the lock-down periods in COVID. At the same time, it was also revealed to us that there were some incompatibilities and disconnects in our policy-settings, as well as in our conventional business model (including distribution system) which made it difficult to take the opportunity at that moment”, said BGMEA President FariqueHassan.
Limitations arising from the regulatory framework, particularly in the realm of cross-border transactions and foreign currency policies, serve as an impediment for the apparel industry to tap into the global burgeoning e-commerce market.
The National Digital Commerce Policy of 2018 only governs the domestic market, and does not make any explicit policy framework addressing international e-commerce.
To elaborate, the absence of global payment gateways, challenges in securing working capital financing, cumbersome export processing for small orders, and an impractical return policy (where returns are categorized as imports) constitute substantial impediments to establishing a robust digital marketplace.
Considering these challenges, BGMEA undertook a study project as a precursor to developing a virtual platform tailored for Bangladesh Textile and Apparel Sector. The study report was officially unveiled on the 25th of January, 2024.
The report identifies market potential and sector readiness to digitize the apparel sector of Bangladesh.
The study also proposes sustainable business models along with policy gaps, and necessary strategies essential for the successful implementation of the marketplace.
The report emphasizes two critical strategic approaches for the sustained success of the apparel sector: (1) Expansion of current Business-to-Business (B2B) activities into emerging markets like Asia and Middle East and (2) Creation of additional value by establishing direct connections between Bangladeshi manufacturers and end customers (B2C).
