Some RMG Buyers Shifting Work Orders From Bangladesh For Strategic Reasons

👕 Some long-time international clothing retailers and brands have been shifting their work orders from Bangladesh to other countries for strategic reasons, according to the president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA). Buyers shift their sourcing based on strategic needs as they always want good-quality products at lower prices, said Mahmud Hasan Khan at a press conference at the trade body's office in Dhaka yesterday.

📊 "That is why we are trying to bring new buyers here. As for the internal strategies of buyers — the sourcing strategy I am referring to — they will not necessarily purchase all their products from a single source," said the BGMEA president. "That is a challenge for them, just as it is a challenge for us. It is their job to determine their strategy, and we will determine ours. We want new buyers to come here continuously, while the existing buyers continue their business with us."

📜 Strategic Sourcing: Buyers Diversify Supply Base

Mahmud declined to disclose the volume or names of the buyers looking to shift work orders away from Bangladesh. The buyer diversification trend reflects a broader global pattern where major apparel brands are reducing concentration risk by spreading sourcing across multiple countries — a trend accelerated by the COVID-19 pandemic, geopolitical tensions and the growing emphasis on supply chain resilience. Bangladesh's heavy dependence on a few major markets (EU, US, UK) and a concentrated buyer base makes it particularly vulnerable to strategic sourcing shifts.

• 📊 Factories closed since January 2026: 30 (14,000 job losses)
• 📊 New factories since January 2026: 53 (24,000 new jobs)
• 📜 Japan desk launch: September 23
• 📜 Hong Kong roadshow: October 28
• 💰 Japanese apparel import market: $12 billion
• 📜> LDC graduation deferment: 3 years
• 📜> EU FTA target: 3-4 years
• 📊> AI adoption: Shipping, marketing, management, automation

💰> BGMEA's Market Diversification Strategy

The BGMEA has taken a series of initiatives to bring in new international clothing retailers and brands and to woo existing buyers into increasing their purchase volumes from Bangladesh. As part of the efforts, the BGMEA chief said, the association will inaugurate a dedicated Japan desk at its office on September 23 to capture a larger share of the $12 billion Japanese clothing import market. They are also scheduled to hold the Bangladesh Apparel Roadshow 2026 in Hong Kong on October 28 to attract foreign and new garment buyers.

🌏 LDC Graduation Deferment: Strategic Buffer

Mahmud said the proposed three-year deferment of Bangladesh's graduation from least developed country (LDC) status sends a message to international retailers and brands, as local exporters will be able to supply garments at competitive prices for longer as a result. The LDC graduation deferment — which extends Bangladesh's access to preferential market arrangements — provides a meaningful strategic buffer for the RMG sector, giving exporters additional time to prepare for the post-preference trading environment.

🤝 EU FTA: 3-4 Year Target

The BGMEA chief also said he was hopeful that the government could sign a free trade agreement with the European Union within the next three to four years, calling this necessary instead of pursuing GSP Plus status in the European Union market. The preference for an FTA over GSP+ reflects a strategic assessment — GSP+ is a unilateral preference that can be withdrawn by the EU, while an FTA is a bilateral agreement that provides more durable and reciprocal market access. An EU-Bangladesh FTA would also open EU market access for non-RMG exports, supporting Bangladesh's broader export diversification agenda.

🔥 Gas Supply And Factory Closure Update

On the gas supply situation, he said conditions have improved over the last few days following the government's announcement on the matter. Asked about factory closures, the BGMEA chief said no garment factory had shut down due to the recent gas crisis, though the crisis did have an adverse impact on operations. The clarification that no factory closed specifically due to gas crisis — while operations were affected — suggests that the sector's resilience was tested but not broken by the energy supply disruption.

📊> Factory Closure And New Membership Balance

Since January 2026, 30 garment factories were closed for various reasons, resulting in 14,000 job losses. During the same period, however, 53 new factories were granted membership, employing 24,000 workers. The net positive factory balance — 23 more factories opening than closing, with 10,000 net new jobs — suggests that despite the challenges facing the sector, investment in new RMG capacity continues. The 30 closures reflect the ongoing competitive pressure and consolidation in the sector, while the 53 new openings demonstrate continued investor confidence in Bangladesh's RMG industry.

🤖> AI Adoption: Efficiency Without Job Losses

Factories are using AI in shipping, marketing, management and automation to improve efficiency and stay competitive in international markets, he said, adding that this has had no impact on workers' job prospects. The AI adoption without job displacement is a positive signal — it suggests that Bangladeshi RMG factories are using AI to enhance operational efficiency (optimising shipping routes, improving demand forecasting, automating administrative processes) rather than replacing production-line workers. This human-centric AI adoption model aligns with the sector's labour-intensive structure, where the competitive advantage lies in skilled labour rather than capital-intensive automation.

He also said since January 2026, 30 garment factories were closed for various reasons, resulting in 14,000 job losses. During the same period, however, 53 new factories were granted membership, employing 24,000 workers. He lauded the incumbent government's cooperation in sparing time to meet with the trade body to discuss issues concerning business improvement.