After recovering swiftly from the havoc caused by the pandemic, Bangladeshi garment manufacturers are now anticipating a slowdown as sales at key customers such as Walmart are hit by inflation. Walmart recently cut its full-year profit forecast and pledged to reduce prices of clothing and general merchandise more aggressively than it did in May to reduce a spring backlog.

The retailers’ orders to Bangladesh exporters have slowed down, says Faruque Hassan, President, BGMEA. Bangladesh's garments exports last shrank in July 2021 when COVID-19 cases were high around the world. Since then, sales have surged, growing by a multi-month high of 60 per cent year-on-year in March this year and 41 per cent in June, according to BGMEA data.

Two Bangladeshi garments suppliers to Walmart said other Western customers were also sitting on huge inventories. The European Union accounts for about 60 per cent of Bangladesh's total garments sales, followed by about 20 per cent to the United States. Other buyers include Japan, Australia, India and China.

Industry players now hope sales to the smaller markets will help them see through the current slowdown without too much damage, while they try to optimise manufacturing.