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Export Oriented Footwear Industry of Bangladesh: Presented by
Export Oriented Footwear Industry of Bangladesh: Presented by
Footwear Industry of
Bangladesh
Presented by
Laboni Aktar Tarana; Roll: 14
Md. Touhidur Rahman; Roll: 39
IBA, MBA 52D
Leather Industry Exports (in million USD)
500
443.54
450 419.32 424.05
399.73
400
350 330.16 335.51
297.83 297.8
300
250 226.1
204.09 197.36
200
161.62
150
99.36
100
55.42
50 29.06
0
FY10 FY11 FY12 FY13 FY14(Jul-Apr)
Leather Leather Product Footwear
Growth of Footwear Exports of Bangladesh (USD
million)
600
550
500
419
400
336
298
300
204
200 183
159
123
95
100
0
2006 2007 2008 2009 2010 2011 2012 2013 2014
PESTLE Analysis of Leather and Footwear Export Industry
• Political unrest
Political Factors • Poor enforcement of environmental laws and rules
• Cheap labor
Economic Factors • Poor infrastructure
• Unavailability and high cost of power supply
• Large population
Social Factors • Change in buying patterns
• Tax policies
• Duty free facilities
Legal Factors • Safety regulations
• Compliance issues
Strengths Weaknesses
• Governments declared “Thrust sector” & • Selective and limited Access to Finance
highest priority to Footwear & Leather • Lack of Skilled Workforces
Goods • Lack of access to latest technology and
• Almost 90% materials are locally machinery facilities
available • Poor/or no R&D, laboratory facilities
• High quality and reputation of natural • Poor compliance practice
leather • Poor infrastructure, power supply
• Availability of labour and low labour • High rate of interest on term loan
cost
• Comparative price advantage in
international market
• Favourable geographical location
Opportunities and Threats of Export Footwear Industry
Opportunities Threats
• Increasing International and Local demands • Absence of integrated long term policy
for value added leather products • No dedicated skill development institute
• Low wage workers convertible to skilled • Political instability, corruption
ones • Increasing import of low priced synthetic
• No duty on shoes, leather products made and products
exported from Bangladesh • Illegal export of raw hides/skins Smuggling
• Local and Foreign Direct Investment • Potential buyers stringent stands for
opportunity in value added leather products compliances, and delay in building Common
sector Effluent Treatment Plant (CETP)
• China is losing competitiveness • Emergence of alternative sources like
• Government policies - GSP, Cash Incentive; Myanmar
etc.
• Already big players invested in BD signalling
many more to follow
Triple Triangle Framework/ Three Domain Framework
(1/4)
Triple Triangle Framework/ Three Domain Framework (2/4)
• Capital
• Substantial amount of capital required in near future
• Culture
• Increasing global competition
• Global Strategy - “Think Global, Act Global”
• Maintaining international qualities
• Capabilities
• The second best leathers in the world
• Low cost labor
• VRIN model – Valuable, Rare, Inimitable and Non-substitutable
Triple Triangle Framework/ Three Domain Framework (3/4)
• Customer
• Foreign customers
• Customers from USA, Japan, Canada, etc.
• Competitor
• Competition is high
• Collaborator
• Quality of raw materials, equipment and machineries
• Delivery process
Triple Triangle Framework/ Three Domain Framework (4/4)
• Technology and Innovation
• Machines from Italy and Germany
• International Factors
• Increasing demand in international markets
• Expected shift from China and India
• Competition from countries like Myanmar
Thank You
Questions?