The challenge, then, is not simply to protect what Bangladesh has already built, but to make it stronger. The pressures facing the garments industry today are exposing weaknesses that can no longer be treated as temporary disruptions. Energy shortages, rising costs, changing buyer expectations and growing competition are forcing manufacturers to look beyond the traditional measures of competitiveness. For Bangladesh, the next phase will depend on how effectively the industry, government and international buyers respond to these pressures—not separately, but as parts of the same supply chain.

But government support alone will not solve the competitiveness problem. Factory management has its own responsibilities, and some of the most difficult changes will have to happen inside factories. Bangladesh cannot build its next generation of competitiveness primarily on lower labour costs. Productivity, lean manufacturing, preventive maintenance, workforce development, middle-management capability, product diversification and financial discipline will become increasingly important. A factory needs to know where production minutes are being lost, where materials are being wasted, why quality failures occur, why workers leave and where delays are affecting shipment performance. These may sound like basic management questions, but in a low-margin industry, the answers can determine whether a factory remains viable.

Read part 1: https://www.textiletoday.com.bd/bangladeshs-garments-industry-at-a-turning-point-part-1

Digitalisation will also have a role, but the industry should be careful not to confuse technology with progress. A factory does not become modern simply because it has software, dashboards or automated systems. Technology is valuable when it helps management make better decisions, improve traceability, reduce waste, control quality or respond more quickly to problems. The same principle applies to artificial intelligence and automation. The important question is not whether a factory is using the latest technology. It is whether that technology is solving a real business problem and improving the economics of production.

There is another issue Bangladesh cannot afford to avoid: the cost of bureaucracy. When entrepreneurs face unnecessary delays, overlapping approvals, repeated inspections or pressure to make unofficial payments simply to obtain routine services, the damage goes well beyond the immediate financial cost. Management time is lost, decisions are delayed and uncertainty increases. A factory owner may tolerate such friction when margins are comfortable, but when energy costs, wages, financing costs and buyer pressure are all rising, these smaller inefficiencies begin to accumulate. Reducing unnecessary bureaucracy is therefore not simply a governance issue. It is an industrial competitiveness issue.

This is why the relationship between government and industry needs to become more predictable and institutionalised. Too often, the relationship becomes most visible during a crisis. Factories ask for support, government agencies respond, and once the immediate pressure eases, attention moves elsewhere. Bangladesh needs a more permanent competitiveness partnership. Customs, utility connections, industrial approvals, inspections and other regulatory processes should become faster, more transparent and easier to track. This does not mean weakening regulation. A globally competitive apparel industry needs strong labour, safety and environmental standards. The issue is how those standards are implemented. Good regulation should identify genuine risks, enforce the law consistently and help responsible businesses comply rather than creating unnecessary uncertainty for them.

At the same time, factory owners should be willing to look honestly at their own management practices. Not every problem is caused by policy, energy shortages or buyer behaviour. Some factories still have weak production planning, inefficient cost structures, poor maintenance, inadequate middle management or limited investment in workforce development. Some make large capital investments without asking whether the investment will actually improve productivity. Others remain heavily dependent on a small number of products or customers. The next phase of Bangladesh’s apparel industry will require more disciplined management and a much clearer understanding of the economics of each factory.

Diversification will be an important part of that process. Bangladesh has significant potential to move further into man-made fibre garments, technical textiles, sportswear, outerwear and other higher-value products. But diversification should not mean simply producing a different type of shirt. It should mean developing the skills, technology, machinery, raw-material supply chains and management capabilities required to compete in more sophisticated segments. The country also needs to think about market diversification. Depending too heavily on a limited number of major markets creates vulnerability when consumer demand, trade policies or geopolitical conditions change.

The future will also require Bangladesh to think beyond the garment itself. Traceability, digital product passports, circularity, recycled materials, carbon accounting and supply-chain transparency are becoming increasingly important in international apparel markets. These requirements may initially appear to be additional costs, but they can also create opportunities. A manufacturer that can provide credible information about where its raw materials came from, how much energy was used, how waste was managed and how the product moved through the supply chain may eventually be able to offer something more valuable than simply a low production price. The challenge is to ensure that these systems are built around real operational improvement rather than another collection of certificates and documents.

There is also a human dimension that should remain at the centre of this discussion. Behind every export figure is a worker whose income depends on the factory remaining open. Behind every delayed shipment are people whose jobs and earnings can be affected. Behind every factory investment is an entrepreneur who has put capital and years of effort at risk. And behind every purchasing decision is a global consumer who increasingly wants to know not only what a product costs, but also how it was made. The garments industry is therefore not simply an export sector. It is a vast economic and social ecosystem. Competitiveness that ignores workers, safety and responsible business practices may produce a cheaper product in the short term, but it will not necessarily produce a stronger industry in the long term.

Perhaps this is the point at which Bangladesh needs to reconsider what it actually means to be competitive. For many years, competitiveness was often discussed in terms of wages, FOB prices and production costs. Those factors will remain important. But the definition is becoming wider. A competitive factory of the future will need to produce efficiently, use less energy and water, maintain reliable quality, retain skilled workers, respond quickly to buyers, manage risk and demonstrate credible social and environmental performance. In other words, competitiveness will increasingly be about the ability to create more value with fewer resources and less disruption.

Bangladesh has already demonstrated that it can change when circumstances demand it. The transformation in factory safety, the growth of green manufacturing, the development of responsible sourcing systems and the continued investment of many manufacturers are evidence of that. But the next transformation may be more difficult because it cannot be achieved through compliance alone. It will require better productivity, better management, better infrastructure, better energy security, better financing and a more predictable business environment. It will also require buyers to recognise that supply-chain resilience cannot be built entirely by transferring additional requirements and costs to suppliers.

The current difficulties should therefore not be dismissed. Energy shortages, geopolitical uncertainty, rising costs and changing trade conditions can genuinely damage factories and employment if they remain unresolved. But the crisis also provides an opportunity to ask questions that may otherwise be postponed. Why should a manufacturer spend so much time navigating administrative processes instead of improving production? Why should a factory invest in sustainability if the commercial relationship does not recognise the investment? Why should workers receive training only when a buyer requires evidence of it? Why should technology be purchased without first identifying the problem it is supposed to solve? And why should Bangladesh measure its apparel success mainl...

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