Mohammed Abdul Jabbar, managing director of DBL Group

Mohammed Abdul Jabbar, managing director of DBL Group

The digital integration of Bangladesh's booming textiles and garment sector is gaining pace, with 'Industry 4.0' becoming a watchword for increased competitiveness. One company taking such technological development very seriously is Dhaka-based DBL Group, which has targeted digital efficiencies to turbocharge its business growth – as managing director MA Jabbar explains.

"We call it a next-generation smart company," Mohammed Abdul Jabbar, managing director of DBL, says in an exclusive interview with just-style in his office on the 13th floor of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) complex in the capital's commercial area.

"Our manufacturing technology comes in line with that of the fourth industrial revolution. Initial factories that we set up in 2006 were semi-automated. Now all our factories are completely integrated and 100% linked [digitally]. We take it as an important area so that we can have a competitive edge."

DBL, which transitioned from doing "lots of subcontracting" to landing its maiden order of US$175,000 for ladies' garments from British retailer New Look in 1993, has not looked back since then.

Jabbar, a computer science graduate of the University of Texas, not only used his stay in America to learn how to apply tech to business, but also picked up inspiration to dream big from the USA's culture of personal advancement. He told just-style how seeing the scale and wealth of the colossal Rockefeller Centre in New York had shown him what business can deliver.

In less than three decades, he managed to catapult the largely family-run company into a knitting goliath with 14 textiles and clothing units. Matin Spinning Mills Ltd, one of its subsidiaries, is listed on the Dhaka and Chittagong stock exchanges, but most of the group remains private.

DBL makes yarns, fabrics, casual and fashion wear for men and women that it supplies to top Western and Japanese high-street retailers.

The entire group's sales turnover reached US$372m in the 2017 financial year, which ended in June – with turnover growth averaging more than 10% in the past five years.

By 2020, DBL hopes it will log US$1 billion in turnover, if planned reductions in costs and new product lines come to fruition, Jabbar says, beaming with optimism.

Growth, of course, means production expansion. In May this year, the company opened a factory in Ethiopia to produce jerseys and tops and bottoms for men and women. The Ethiopian plant employs 2,500 people.  

Developing in Ethiopia is part of the "going global" strategy, which fits well with the company's business plan, says Jabbar. Primarily, he adds, the idea is to serve buyers from different geographical locations.

Ethiopia is an attractive choice on multiple grounds: the east African nation is close to Middle East and north African markets with decent proximity to some southern European ports, and the country has duty-free access to the United States under the African Growth and Opportunity Act (AGOA).

Technology investments

For Jabbar, the use of technology makes huge economic sense.

Fast React enterprise resource planning (ERP) software; SedoMaster textile production and dye management software; and ColorMaster, a dye recipe management system, are among the solutions used by DBL to monitor and capture data, boosting performance.

Internet of Things (IoT) tech is also being widely used by the company to ensure that the output is excellent, he adds.

"The dyes and chemical dispensing systems are automated...we can also monitor at what speed fabrics move, the percentage of defects, what kinds of defects, and where defects are coming from," Jabbar maintains.

"We monitor how much energy we use and how much water we consume. We always concentrate on how we can use less energy but produce more. We want all actions to be perfect"

"We monitor how much energy we use and how much water we consume. We always concentrate on how we can use less energy but produce more. We want all actions to be perfect."  

To tech-fortify the company, Jabbar has leaned on what he calls knowledge partners, such as IT company Oracle and the World Bank's International Finance Corporation (IFC), which has provided support and advice on how to improve technology.

Jabbar has also tapped global buyers to learn from their experience. And he has invested heavily in human resources and cutting-edge technology in the company's design and innovation centre.

Also new is investment in its rotary screen printing capacity, with the addition of two new 16-colour printing machines that will double capacity at its DB Tex fabric and garment printing unit to 40 tons per day.

Activewear and lingerie

He is keenly aware of the changing dynamics of the apparel industry when production shifts from China and the use of manmade fibres gains momentum.

The knitwear maker, based in north Dhaka, plans to set up a polyester filament yarn spinning plant by 2019 to support its integrated sportswear and intimate apparel lines, he says.

Why this new venture? In the words of Jabbar: "We see increasing trend and sourcing demand for activewear and lingerie from Bangladesh."

"Our existing customers are buying these from China, Vietnam and Europe. When we produce, they will buy from us," he predicts.

The group is already working with companies such as Puma, Marks & Spencer (M&S), Hennes & Mauritz (H&M) and Decathlon to offer them new product lines.

And for new value-added products, such as lingerie, the company will use warp knitted fabrics and lace as inputs.

It is planning to pump US$100m into an integrated lingerie plant in north-eastern Bangladesh's Habiganj district to make bras, panties, nightwear and swimwear. The unit will be housed inside a DBL Economic Zone, a US$1.2bn cluster planned to be fully operational by 2021.

The knitwear behemoth is also adding more Votex technology for viscose yarn with cutting-edge technology from Europe.

DBL's drive mirrors an industry trend. Industry consultant Navdeep Singh Sodhi, of the Gherzi Textil Organisation, says that while cotton remains dominant in Bangladesh, the share of manmade fibre has rapidly grown in the past five years.

Diversification into manmade fibres has helped DBL more than double its turnover over the past 10 years

This diversification has helped DBL more than double its turnover over the past 10 years, says Jabbar.

Challenges

Establishing vertically-integrated industrial units, capacity expansion, product diversification and entering geographical locations in terms of market and manufacturing operations have been among the key changes made to the business over the past decade.

The journey has not been free from challenges in a country where infrastructure remains rickety and the costs of labour, utilities and raw materials keep rising.

Meanwhile, the company is also wrestling with falling prices in some markets and segments, Jabbar admits.

However, he insists that the company has not cut corners on compliance and ethical sourcing as a result; indeed DBL has found opportunities in these areas, says Jabbar, who has also been influenced by contributions made by altruistic industrialists such as Rockefeller to American society.

Rather DBL stays ahead of the curve, thanks to its long-term business partnerships, a strong integrated supply chain combined with cutting-edge manufacturing technology and processes, and a firm focus on sustainability.

To stay competitive, the company must boost efficiency, reduce waste and diversify products, while at the same time integrating the latest technology into manufacturing operations.

"Today we are a better company than we were before, having one common standard throughout our operations," Jabbar explains.

Opportunities

The DBL boss also sees opportunities in new emerging markets. India and China make up over one-third of the world's population and Jabbar believes Bangladesh cannot afford to overlook these two "very big markets" that are also in convenient geographical proximity.

"What Turkey is to Europe for fast fashion, Bangladesh is to India and China," he argues.

Asked if omni-channel sales such as e-commerce and m-commerce have impacted DBL, Jabbar says the company was not directly affected as it does not deal with end customers. Still, he says his group is closely watching changes in the consumer market in case there is an impact on sourcing.

Meanwhile, DBL has kept faith in having long-term strategic business partners. Juggling with too many partnerships can present "insurmountable issues," Jabbar says.

Closer collaborations with fewer "trusted partners" is the logical choice for buyers and suppliers alike – and some good buyers are presently curtailing their supplier base, thus ramping up their sourcing capacity with selected suppliers, Jabbar notes. "Closer collaboration with fewer suppliers is happening here in Bangladesh."

Jabbar's vision is for DBL to become one of the most reputed global suppliers for apparel and textiles with "a strong focus on social, environmental and ethical standards."

The company will also pursue its objective of moving towards high-end fashion with diversified and new products, such as sportswear, polo shirts, using viscose, nylon and synthetics and knit embellishments.

Despite being a family-owned enterprise, the group is investing time and effort into implementing corporate governance and family business governance for the "greater good of the company and sustainable business," according to the company's 2017 sustainability report.

Following United Nations-led global sustainable development goals, DBL has mapped out its own targets, with 2020 deadlines. For example, the company aims to increase the number of women supervisors on lead sewing lines by 50%, cut water consumption to 50 litres for dyeing 1kg of fabric, and generate 10% of its electricity from solar power over the next two years.

DBL Group – Factbox

DBL Group, launched in 1991, is today one of the largest knitwear makers in Bangladesh, with 20 units. The group's sales turnover amounted to US$372m in the 2017 fiscal year, ending in June 2018, while exports reached US$195m during the same period. 

Products and services provided by the integrated knitwear maker include yarns, fabrics, casual and fashion wear such as T-shirts, polo-shirts, joggers, hooded jackets, cardigans, leggings, skirts and gowns.  In addition, the company is involved in all-over-printing, screen printing, washing, accessories, packaging and dyeing. 

Major brands and retailers that buy DBL products and services include Hennes & Mauritz (H&M), Target, C&A, Next, George at Asda, Marks & Spencer (M&S), Walmart, Gymboree, Guess, Puma, Lidl, G-Star Raw, Decathlon, Tom Tailor and Esprit. 

Headquartered in Dhaka, the company's production facilities are located mostly in Kashimpur, Dhanua, Sreepur and Joydebpur. Since the 2013 fiscal year, the group's workforce has more than doubled to 33,000 people, more than one-third of whom are women. The company has set out a vision for future growth that will transform it into a "diversified global conglomerate".