Readymade Garments Industry of Bangladesh Essay

Topics: Strategic management, Textile industry, Market Pages: 16 (5234 words) Published: January 30, 2013
1.0 Introduction
1.1 Background of the study
The readymade garments (RMG) industry of Bangladesh is the fastest growing export oriented industry of the country. Starting in late seventies, the ready made garment industry of Bangladesh now accounts for over 64% of the country's total export earning. A close look at the composition of RMG export of Bangladesh over the last two decades reveals that the woven garments sub-sector constituted the lion's share. In fact, the beginning of the development of RMG sector started with woven garments in 1985. In the first half the 90s, the share of woven garments was above 80%. However, the share gradually started to decline to about 70% in five years late and to 62% in 2004 and to 38.80% in 2005-2006 (Export Promotion Bureau Bangladesh, 2006). In addition, compared to its double-digit growth in the 90s, the woven garments export grew only about 8% in 2000. Such a declining growth rate and a steep decline of the share of woven garments export in the total RMG export makes it urgent to re-evaluate the status of the sector of Bangladesh vis-à-vis with that of the competing countries. Moreover, with the dominance of the proponents of free market economy, some changes are taking place in the global trade regulations affecting the readymade garments sector of Bangladesh in general. One example of such change is the phasing out of the apparel quota on December 31, 2004. Under these circumstances, it is imperative to assess the competitiveness of the woven garments sector of Bangladesh in the global market place. Hence the researcher studied the overall woven garment industry in group and this study analyzes the woven garments industry competitiveness of a single organization from strategic management perspectives. 1.2 Rational of the Study

The objectives of the enterprise analysis are the following. •To identify the vision, mission, objectives, and values of the company. •To identify the process of crafting and executive strategy. •To analyze the company's resources and competitive position. •To find out the application of the five generic competitive strategies. •To find out the application of various complementary strategic options. •To find out the fit of the strategies to the company and the industry situations. •To identify various diversification strategies.

To find out the application of ethics and corporate social responsibility. •To identify the leadership styles and corporate culture. 1.3 Scope of the Study
The study has some boundaries. The following points delineate those boundaries. •Because of the highly fragmented nature of the industry even in the domestic market (with about 400 woven producers present in different parts of the woven garments value chain), aggregation of enterprises could not be provided. Rather, a whole view point of the enterprise has been taken. This limits the researchers of this study not to use financial aggregation as well since only a few woven garments industries (not more than 5) are enlisted with the stock exchange. •The analysis has been confined to the key markets of the woven markets. The markets where Bangladesh occasionally exports or where the amount of export is very small, those markets are excluded from the scope of the study. 1.4 Methodology

1.4.1 Research design
The study, given the nature of the objectives, has a descriptive research design.Since this study is going to be one of the earliest studies with similar objectives about the woven garments sector, the research would be of ‘reporting' kind. According to Cooper and Schindler (2003), at the very elementary level a ‘reporting study' is done to provide an account, or to make a summation of data, or to generate some statistics. They have also argued that a reporting study requires very little inference. However, the current study answers ‘what' and ‘why' of Macro environment, industry and competitive conditions, and thus, requires a great deal of...
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