Ptak Prize Global Supply Chain Case Competition 2019

2. Abstract:
In recent times, the global garment and textile industries aspect changing. Fashion & trends are
frequently changing now a days then ever before. Fast fashion is the darling of the fashion retail
today. Inexpensive clothing produced rapidly by mass-market retailers in response to the latest
trends. The overall effectiveness of SCM of apparel industry in Bangladesh is still low. One single
and very simple issue like mismatching thread count or wrong button line, incorrect or delayed
information can make the whole process jeopardies. In this circumstances apparel and garments
industry have no other choice but to grab supply chain 4.0 to minimize the lead time and take
advantage of it.
Introduction :
The ready-made garment (RMG) industry has recently occupied the largest part of exports and
foreign currency in Bangladesh and has been for more than a decade the second largest contributor
to gross domestic product (GDP). Millions of poor women and men are employed in this industry.
Globalization has made the apparel industry more competitive, which indulged today’s
organization to work on quick response so that they could market their product as quickly as
possible. We can see now interest is shifting from material planning, inventory management to
integration or partnership building.International trade regimes, concerns with labor standards, new
competitors and forms of competition. Only minimum wage competitiveness does not guarantee
of an international business of this kind. These challenges have a strong impact on least developing
countries like Bangladesh.
Industry 4.0 is the common term for modern industrialization. This is leading to automation and
data exchange in manufacturing technologies. It includes entities like cyber-physical systems,
internet of things (IoT), cloud computing, artificial intelligence (AI) etc. All these tools have made
it possible for what is called ‘smart factory’. There are four main pillars of Industry 4.0 such as
augmented reality. These 4 pillars help companies avoid errors by enabling them to manage
inventory at real time; additive manufacturing such as 3-D printing and robotics which allows the
companies to produce faster; big data, like IoT enables with data centralization and storage.
Therefore, in order to sustain their businesses, Bangladesh Garment Industries need to improve in
reducing the Supply time required to produce and fulfill the orders placed by foreign companies
to overcome their problems, and to join the global value chain.

3. Present situation:
RMG Business Structure :

4. Figure: Supply Chain Link Of Micro Level
Buyers design their fashion according to their seasons.Summer, Winter, and Spring – these three
seasons are common in their business calendar. No customer will buy the products at summer
which needs for the winter season.Contrary, due to the involvement of huge investment buyer does
not allow any supplier unlimited time to produce their ordered products.Failure of raw materials
schedule along with partial or wrong delivery is a common phenomenon of the supply chain.
Materials are not available at the right time; compliance does not permit excessive working hours,
no compromise with lead time. Beside fast fashion and trends are now changing within 15 to 20
days. Therefore the apparel and fashion industries are now in need of more varieties in their
products which needs to be produced in a very short period of time. All this is a quandary situation
for the RMG industry.

5. Raw materials Supplier relationship is different. In this Industry the main raw materials are fabrics
(Cloths) and few accessories are like button, collar etc. About 80% of the suppliers of accessories
are local and accessories suppliers are not responsible to Increase time. Bangladesh garment
manufacturer need more time is getting higher due to import of fabrics mainly from China,
Indonesia and India, The total average time to import fabrics from abroad is 50-65 days and this
for long lead time (BGMEA research cell).
Problem Analysis:
To analyze the problem we have developed a fish bone diagram -

6. From the above fish bone analysis we can see that the main problem is the Lead Time.

7. Possible solution:
The implementation of industry 4.0 can be divided into 4 categories:
1. Inventory Management
2. Logistics Management
3. Digital Marketing
4. Manufacturing Process
Inventory Management :
RFID
Radio-frequency identification uses electromagnetic fields to automatically identify and track tags
attached to objects. The tags contain electronically stored information. Passive tags collect energy

8. from a nearby RFID reader's interrogating radio waves.RFID technology has potential to
significantly improve supply chain efficiency, as it enables real-time visibility and better
coordination between marketing and manufacturing activities. It can reduce cost and time, as well
as improve inventory management.
ERP: ERP or Enterprise Resource Planning has been in Apparel and Textile industry for quite a
long time. The Apparel and Textile industry is really complex. Not like automotive industry where
the variants of a Single car run on a single assembly line for decades, apparel and textile industry
sees a lot of variation every minute. With introduction of new production systems like Lean and
Modular which have been successful in Automotive, Apparel and Textile industry also got into
the trend of same. Companies like LT Karle, Gokaldas Exports, Laguna, ITC and many other went
on to take initiatives on Modular, Lean and Just in Time Manufacturing concepts. All the above
mentioned systems required focus on reducing Work In Progress and Waste and Increasing
initiative on operator training. To support manufacturing system many Solutions to Apparel and
Textile Industry are being proposed; right from Material Handling, Material tracking to ERP.
As the competition is increasing and margins and timelines are being reduced, people in Apparel
and Textile Industry have started realizing that need for cost control and utilizing the Enterprise
wide resources to the maximum have become essential. ERP comes as a rescue to all these issues.

9. Logistics Management: Through the invention of modern technologies the logistic management
has become more flexible than ever before.

11.  Designing and construction of fashion products should take dimensions of the product into
account,
 The way, the size and shape of packaging,
 Factors of arranging the commercial packaging and its fitting into transport packaging,
 Utilization of cargo and storage space,
 Manipulative characteristics of products, commercial and transport packaging.
Digital Marketing:
With the extensive technology development which has undertaken by the world, traditional
concept of marketing has fabricated with a digital mode that brings the whole world to the
customer’s doorstep in one click. The rising penetration nature of the internet and various faster
digital communication channels, wider networks and new devices and their connectivity with
marketers made consumers more informative and knowledgeable regarding the value they
expected to return to the cost they incurred. The utmost purpose of the study is to identify the
impact of digital marketing in consumer behavior with special reference to retail fashion industry.
Secondary sources of data has used for the study and based on the results of the secondary data
analysis, conclusion has derived with the findings. Accordingly, the research study was addressed
on how digital marketing has changed the retail fashion industry and how it effects on the consumer
behavior. With the analysis, it has recommended customer relationship marketing as a strategic

12. response to face the changes made from digital marketing in the retail fashion industry. Also it has
identified on how the skills, attitudes and the behavior of the professional marketers should be
shaped in strategizing the customer. .
Manufacturing Process :

14. Supply Chain 4.0 :
Supply Chain 4.0 is the application of the Internet of Things, the use of advanced robotics, and
the application of advanced analytics of big data in supply chain management: place sensors in
everything, create networks everywhere, automate anything, and analyze everything to
significantly improve performance and customer satisfaction

15. 4 depicts the adaptive supply chain management strategy as drawn from elements of supply chain
management, agility and sustainability.

16. Impact :
 An enterprise-wide digital supply chain can lead to a 20% reduction of procurement
costs, a 50% reduction in supply chain costs, and an increase in revenue of 10%.
 Technology will enable supply chains to share data directly help to probe markets and
facilitate for faster responses to market change, thus, improving responsiveness.
 Enhanced transparency
 Increase the range of value added services
 Using modern fast and effective machinery can reduce time taken to deliver the order. A
lessen in lead time, besides quality and costing criteria, is needed to increase more orders
from retailers.
 Supply chain 4.0 will enhance the lower inventories, higher productivity, lower cost,
shorter lead time, higher profits, greater customer loyalty.
Limitation:
As industry 4.0 is an automation and data exchange process it has some boundary also
- Cyber security is a major concern.
- Skills and education of workers working on industry 4.0 in apparel industry based
processes needs to be improved drastically.
- There will be general reluctance to change to industry 4.0 by company management since
Transparency is a key pillar of Industry 4.0.

17. - Reliability and stability are required for M2M (Machine to Machine) communication. This
demands very short and stable latency timings in the system.
- Integrity of apparel production processes is crucial.
Recommendation:
Identifying the beginning of the process and walking through the process is very important.The
business environment has changed in the 21st
century such that working alone is less competitive
while collaborative working among upward and downward supply chain partners is more
profitable. Through managing the supply chain, the ultimate objective of companies is offering
maximum value to customers for the delivered products or services by achieving either
responsiveness or efficiency. To add dynamic capability to the RMG sector and enhance supply
chain performance, manufacturers should plan and work collaboratively with the upward suppliers
of fabric and accessories as well as the downward buyers and partners of the supply chain. We
should focus more on.
 Enhancement of R&D sector
 Need to focus more on value added products fabrication than to conventional basic
garments production.
 Provide in-house training for lower and middle management
 Encouraging more ICT application
 Adopt clever CSR schemes for compliance
 Provide Sales Forecasts
 Improve the labor conditions & quality of life
 Take fair wages and incentive scheme
 Pursue lean workshops, streamline production
 Increase proportion of local material supply
 Incorporate ERP, RFID into the system to increase efficiency
 We need to Improve our management skills
 Choose vendors that are closer to the warehouse
Conclusion:
Globalization is just another way to say “global supply chain.” Like it or not, it is here to stay.
Companies that learn to manage the risks of a global supply chain can expect to reap, at the very
least, the reward of survival. But those that learn to proactively manage the problems
encountered in such a diverse system can expect to rule their sectors. The fourth and fifth
generation is a Time and Information Technology based Logistics, the introduction of ICT
(Information communication Technology) filled the tool gap, which was not available in early

18. 70s and 80s.The Lean concept of manufacturing has given birth to agility, which means that the
concept of supply chain is taken over by demand change management. The companies started to
remove the costly waste from vertical manufacturing and implements cost effective outsourced.
This integration requires specialized supply chain partnership, which requires the companies to
extend their hands beyond their thinking. To accommodate with shorter lead time, to avoid
over/under inventory, to minimize wastage of money, to run the company efficiently and finally
to ensure sustainable growth, there is no alternatives of embracing the supply chain 4.0 system.