Bangladesh’s readymade garment supply chain continues to suffer from lack of shared responsibility on the part of global buyers. The fundamental business model in the garment supply chain has not changed. Production remains an industry with high levels of opportunity for countries to connect to global value chains, but that comes at a price for workers.

Factories in shared or non-purpose built premises need to relocate. Firms in such premises which were not able to meet the new standards had to move and often ended up in more remote regions. Such factories have to bear the relocation costs and do not receive financial support from buyers, the government or their industry associations.

Bangladesh’s exporters do not get fair and reasonable prices for their products. Reasons include lack of negotiation skills. Exporters get lower prices for readymade garment products compared to Cambodian and Vietnamese exporters. Buyers do not want to pay higher prices, although the cost of production will go up further with wage hike, port congestion and higher transportation cost. Another issue is that of lead time. This would be a matter in readymade garment exports in future as the country might lose its cost advantage in coming years.