Lockdown dashes fashion makers’ Eid sale hopes
They say a turn-around after last year’s losses has become uncertain
The second wave of Covid-19 and the ongoing strict lockdown has devastated fashion entrepreneurs, who were expecting sales bonanzas at the upcoming Eid-ul-Fitr.
They say the Eid business outlook is dull and turning around after last year's losses has become uncertain.
Eid-ul-Fitr accounts for transactions of Tk1.5 lakh crore in clothing and footwear trades, including more than Tk1 lakh crore in apparel only, according to a 2018 survey by the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI).
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Several lakh entrepreneurs in these sectors expect bumper sales on Eid and prepare accordingly throughout the year. Eid sales begin in earnest from Shab-e-Barat to the15th Ramadan.
Siddiqur Rahman, vice-president of FBCCI, told The Business Standard that traders are now on the verge of financial ruin.
Mohammad Helal Uddin, president of Bangladesh Shop Owners Association and director of the FBCCI, said there are at least 3.5 lakh wholesale stores across the country which have transactions of more than Tk1 lakh crore in the Eid season.
The livelihoods of a large number of people also depend on these sales, but the lockdown has shattered everyone's dream, he said.
Islampur traders fear Tk20,000-25,000 crore losses
Mizanur Rahman, owner of Ankur Cloth Centre in Islampur, has been in business since the 1990s. He lost Tk50 lakh last year due to the pandemic.
Losses will be higher this time, he said.
He re-invested in business by borrowing Tk50 lakh this year to recoup last year's losses. But he is now worried about the future. He also fears that he will lose capital because of the lockdown.
Traders in Islampur sell a variety of items, notably sarees, lungis, children's clothing, and bed sheets. They also sell materials used in making garments.
Although there are no official figures, local business leaders say the annual turnover in Islampur is Tk50,000 crore and Ramadan accounts for around 50% of this trade.
Islampur Traders Association President Shamsul Alam Sabjal said there are 110 markets and about 20,000 traders in Islampur and all the traders are facing massive losses due to the lockdown.
"This market meets 70% of local and 40% of foreign demand for thin fabric (plain cotton fabric). But not even 10% of local and 5% of foreign demand has been met this time," he explained.
Like last year, traders in Islampur fear losses of Tk20,000-25,000 crore ahead of the upcoming Eid, he added.
Wholesale traders in Narsingdi's Baburhat are also in a similar situation. They have invested heavily in having good business in Ramadan but are now facing losses. Some have tried to keep their stores open in defiance of the lockdown but are not getting customers as long-haul transports are currently suspended.
Baburhat market has around 10,000 shops selling sarees, lungis, shalwar kameez, and unstitched shirt and pants fabrics. Thousands of textile, dyeing, embroidery, and other industries have sprung up in Narsingdi around this market. About five lakh people are directly and indirectly involved in these businesses.
Traders said clothes worth Tk200-300 crore are sold here daily on average in the first two weeks of Ramadan.
Mosharraf Hossain, former general secretary of Baburhat Merchants Association, said, "Throughout the year, we look forward to doing good business in Ramadan. We sell new products and collect outstanding payments from the last season. It was a good start this year but the lockdown ruined everything."
Keraniganj loses momentum
Cloth makers on the banks of the River Buriganga, including Keraniganj, supply 70-80% of the local garments sold around the country. Keraniganj is known as the hub of lower- and middle-class garment production. 70% of the garments produced here are sold during Eid-ul-Fitr.
Local traders say the money they make in the Eid season helps them stay afloat for the rest of the year. They have, in current conditions, struggled to pay factory and showroom rents and workers' wages, purchase machinery and raw materials, and repay bank loans as there was no business last year because of the pandemic.
Though they were better prepared this time to overcome last year's losses, the surge in Covid-19 cases and the fresh lockdown have pushed them into incurring big losses again.
Muktar Dewan, owner of Golenur Garments, sells jeans wholesale at Keraniganj district council market. He sold jeans worth Tk2.5 crore during Eid in 2019, but the figure came down to only Tk25 lakh last year. This time, his target is to sell clothes worth Tk3 crore for Eid.
He told The Business Standard he had sold clothes worth Tk50 lakh before the lockdown and the rest of the stock has been left unsold in the warehouse.
"Last year, I took out bank loans and spent from my own capital to pay workers' salaries and to run my family. I tried hard to turn around this time by paying factory and showroom rents. But now I see no way to survive," he added.
There are about 10,000 local traders and owners of more than 5,000 factories who are in a similar situation. These factories employ around four lakh people.
Haji Muslim Dhali, president of Keraniganj Traders Association, said wholesale sales end before the 15th Ramadan.
"The main trade usually takes place in Keraniganj from Shab-e-Barat to mid-Ramadan. Retailers from all over the country come here. Traders here sell clothes worth Tk2,000-2,500 crore ahead of Eid."
Uncertainty grips boutique traders
Bachchu Mia has been producing and selling local clothes at Banti village in Narayanganj's Araihazar for almost a decade. He faced losses last year after investing around Tk6 lakh.
He was preparing to make a turn-around this time, but the second wave of the pandemic and the lockdown have dashed his hopes. He told The Business Standard he had borrowed Tk8 lakh and invested in business this year.
"I had to invest more to recover from last year's losses. I could not sell according to expectations during Pahela Baishakh. Now I am worried about repaying bank loans, paying workers' salaries and factory rents, and also bearing family expenses."
Like him, around 8,000-10,000 boutique traders are concerned. Millions of people work under these entrepreneurs and they are also worried about their lives and livelihoods.
Seven lakh taant weavers face uncertainty
Pabna and Sirajganj have the highest number of weavers in the country. Of them, 3.5 lakh taant workers in Enayetpur, Belkuchi, Shahjadpur, Ullapara, Kamarkhand and Kazipur of Sirajganj are involved in producing local garments, including sarees, lungis and gamcha.
Similarly, in Kalihati in Tangail, Basail, Nagarpur and a few upazilas of Pabna, more than three lakh taant workers are associated with the production of local apparels.
Taant traders say they start business with capital of between Tk10,000 and Tk10 lakh. Although they produce clothes throughout the year, Pahela Baishakh and Eid account for 60% of their sales.
Syed from Tamail village in Sirajganj's Belkuchi upazila says he sells products worth Tk15 lakh a day until mid-Ramadan.
"Clothes that I produced in the last two years are still left unsold. Due to the losses over the two years, now I am struggling to maintain my family.
"I have four sons and daughters. I do not see any other option in the future except working in agriculture," he added.
10,000 footwear factories in Bhairab closed
The country's largest footwear manufacturing and marketing hub in Kishoreganj's Bhairab usually sees a sales bonanza at the beginning of Ramadan while production in factories increases two to three times a month earlier.
Footwear traders from most of the districts under Dhaka, Chattogram, Rajshahi, Khulna, Mymensingh, Rangpur and Sylhet divisions buy shoes from Bhairab.
But factories and wholesale markets are now closed and the owners of more than 10,000 factories are counting losses after having invested large sums.
They are now doing business on a small scale by borrowing money.
The footwear industry created about 1.5 lakh jobs in Bhairab. They live all year round on what they earn during Ramadan and Eid.
President of Bhairab Footwear Owners Association Md Al Amin said he can smoothly run his family for 11 months with the money he earns during Ramadan.
He said the fresh wave of the pandemic and the lockdown has ruined footwear business this year.
"Production is closed and there is no business in stores. More than one lakh people, including factory owners and employees, have no income now."
