Our Apparel Industry Cannot Compete on Price Alone

We find it deeply concerning that, despite a brief August surge, Bangladesh’s primary export engine faces relentless and compounding pressure in its most critical overseas destination. While recent trade data indicates our readymade garment sector has shown relative resilience compared to regional peers, the ongoing contraction of the US apparel market carries an unmistakable warning: relying on low-cost volume growth is no longer a viable long-term strategy.

The numbers, however, present a sobering reality. Total US apparel imports fell 7.42 per cent to $49.08 billion in the first eight months of 2026, as inflation, elevated living costs, and changing consumer habits curbed retail demand across North America. While major sourcing competitors such as China and India suffered devastating declines exceeding 26 per cent, shipments from Bangladesh dropped by a comparatively modest 4.43 per cent. An 11.15 per cent year-on-year rebound in August offers brief encouragement, but cumulative trends confirm that our exporters are navigating an increasingly hostile trading environment.

Beneath Bangladesh’s relative stability lies a far more troubling trajectory. Import volumes fell 2.75 per cent in square metre terms, while unit prices dropped 1.73 per cent - a striking contrast to the overall US market, where average unit prices actually rose by 1.71 per cent. Local manufacturers are being forced to accept lower prices at the precise moment when chronic gas shortages, rising labour wages, transport bottlenecks and elevated financing costs are driving production expenses to unprecedented levels. These shrinking margins leave factory owners with virtually no scope to invest in their workforce, upgrade aging machinery, or absorb future global economic shocks.

The government and industry leaders must treat this trend not merely as a temporary demand cycle, but as a permanent structural shift in global trade dynamics. Cheap labour alone can no longer guarantee market share when international buyers demand shorter lead times, strict compliance standards and complex synthetic fabrics over traditional cotton. The gains made by regional competitors like Cambodia and Indonesia - both of which expanded their footprint in the US market during the same period - demonstrate how swiftly buyer loyalty can pivot towards more versatile suppliers. Protecting our market standing requires urgent investments in product diversification, technical textiles, man-made fibres and automated factory floor operations.

Concurrently, policymakers must address persistent domestic bottlenecks that exporters cannot tackle alone. Expanding generation capacity on paper means little if gas supply disruptions continue to stall industrial boilers and force plants to run on expensive diesel generators. Ensuring uninterrupted energy supplies, eliminating bureaucratic red tape at port customs, and reducing the overall cost of doing business are non-negotiable prerequisites for basic survival.

Ultimately, an export strategy built solely on volume, endless discount pricing and low margins has reached its natural limits. Progress cannot be measured by shipping container volumes alone; it must be reflected in sustainable profit margins, higher-value exports and long-term industrial stability for the millions of workers who sustain this sector. If we fail to move up the value chain today, our flagship industry risks being squeezed out between falling international prices and rising domestic costs.