Merchandising definition. Role in apparel sector Alphabetical meaning of MERCHANDISER, quality and job responsibility. Merchandising process Buyer, order, business procedure and legal requirements for apparel business.

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SL# TOPIC PAGE#
01 Merchandising definition. Role in apparel sector 02
02 Alphabetical meaning of MERCHANDISER, quality and job
responsibility.
02
03 Merchandising process 03
04 Buyer, order, business procedure and legal requirements for
apparel business.
03

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Merchandising definition, role in apparel sector.
Definition of merchandising: It is the systematic working process of a merchandiser. In other words,
it is the flow of systematic work of a merchandiser.
Major roles & responsibilities of a merchandiser:
1. Order forecasting.
2. Order sourcing capacity.
3. Order negotiation technology.
4. Order receiving capacity.
5. Preparing T&A sheet.
6. Calculating yarn/ fabric/ trims & accessories
7. Calculating competitive costing & pricing.
8. Factory scheduling.
9. Production tracking & follow-up
10. Purchasing tracking/ yarn fabric, trims & accessories.
11. Buyers/ suppliers dealing & liaison etc.
12. Product development & sample controlling.
13. Preparing packing list.
14. Departing goods maintaining lead-time etc.
Alphabetical meaning of MERCHANDISER, quality and job responsibilities
Alphabetical meaning of MERCHANDISER:
M- Should have good Managerial capacity.
E- Should be Efficient in both English Correspondence and spoken.
R- Regular in Office attendance.
C- Confident in taking any decision.
H- Must be Honest.
A- Show positive Attitude.
N- Nicely behave and never argue with Buyers.
D- Should be devoted to his Service.
I- Should have better IQ.
S- Sincere in Work.
E- Enthusiastic in nature and Excellent in Dealings
Quality and job responsibilities of a merchandiser:
Major quality of a merchandiser:
1. Sound knowledge about fiber, yarn, fabric, dyeing, printing, dyes, color fastness, quality
control, production process, garments production etc.
2. Clear conception on the usual potential quality problems in the garments manufacturing.
3. Technical knowledge on the usual raw materials inspection systems & garment inspection
system.
4. Clear idea about the quota system used in each of the production countries, duty rates,
custom regulation, shipping and banking documentation etc.
5. Accurate consumption & costing capability on all types of garment.
6. Costing knowledge of raw materials.
7. Order sourcing & price negotiating ability.
8. Sincere & responsible.
9. Hard working.
10. Truthfulness etc.

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Job responsibilities of a merchandiser: A merchandiser do some specific work. These are;
1. Fabric requirements calculations: Merchandisers calculated total fabric consumption for a
garment.
2. Accessories requirements calculations: They calculated how many types of accessories and
quantity required for a garment.
3. Sourcing of fabric: They collected buyer required fabric from different countries and fabric
manufacturer.
4. Sourcing of accessories: They collected buyer required accessories from recommended
company.
5. Costing and pricing: The most important work of a merchandiser is costing and pricing. Here
merchandiser negotiate a reasonable price with buyer including all types of cost to produce this
garments and profit.
6. Communication to buyers: A merchandiser need to communicate with buyer from confirming
the order to final shipment.
Merchandising process
Receive order from Buyer
(Sketch or picture, measurement chart, material details)
↓
Consumption
↓
Costing
↓
Negotiation with Buyer
↓
Order receiving
↓
L/C receiving
↓
Back to back L/C opening
↓
Sample developing and Approving
↓
Approval for bulk production
↓
Related work to production planning
↓
Start bulk production
↓
Line inspection
↓
Final inspection by Buyer
↓
Shipment to Buyer
Buyer, order, business procedure and legal requirements for apparel business
10 tips for finding in Europe:
1. Determine your unique selling points before targeting buyers
Before approaching potential buyers, you need to determine your unique selling points (USPs). Ask
yourself: What makes your company, your products or service level or your CSR strategy special,

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different from the rest? What is your sales strategy? For instance, do you want to be the cheapest
supplier in your country? Do you want to compete by being the most sustainable factory? By
developing innovative materials and concepts? Or do you want to focus on a niche?
Successfully finding and engaging with new buyers is a continuous process. It takes large investments
in time and money. If you do not prepare well by determining your own USPs, any match will likely fail
due to the big difference in buyer requirements and expectations and your capabilities and strategy.
Tips:
 Read our studies on buyer requirements and doing business with European buyers to learn
what buyers require from a supplier and what extra services they appreciate.
 Read our study on COVID-19 for tips on how to respond to the effects of the COVID-19
pandemic on European fashion retail.
Different buyers in the value chain
The most important distinction you should make between potential buyers is their place in the value
chain, because this will determine how they do business with you (see figure 1). Within each part of
the value chain, you will find buyers of different market size, with different requirements regarding
MOQ and price (see table 1).
Each type of buyer needs a specific approach. Always try to find out in what part of the value chain
your buyer is operating, what challenges they face in the market and how you can contribute to their
sales strategy.
 If you want to build your own brand and target European end-consumers directly, try selling
via Alibaba, Wish, Amazon or niche platforms such as Depop or Wolf & Badger. Always
combine selling via a platform with a professional website and social media presence. Most
online consumers can be found in Europe’s northwest. You will need to invest in a web shop,
stock, order management and customer service. Your biggest challenge will be return policies
and a lack of brand awareness.
 Online multi-brand retailers, such as Zalando, Asos, Yoox or About You, sell existing brands
and may develop their own private collections, mostly value brands. They can detect market
interest very quickly and will immediately react to sales data. Usually, such companies will
place a small test order first. If the item is selling well, they will place the actual production
order. Fast delivery is a must. Online multi-brand retailers have benefited from increased
online sales during the COVID-19 pandemic.
 If you want to sell to fashion retailers, Zara, H&M and Primark are some of the biggest names
in Europe, in addition to the many smaller fashion boutiques you will find there. Retailers are
under pressure from the massive growth of online sales via online multi-brand-shops. These
shops can place an order relatively easy as they only need one development sample for order
confirmation. Order quantities range from large (for big players) to very small. Price pressure
is high.
 If you want to service fashion brands, such as Petrol Industries, Kaporal, or Superdry be aware
that they typically develop a collection six to 12 months in advance. You will need a large
sample room, as brands require salesman samples (SMS) of each collection style. Every sample
needs to be ‘actual’: looking exactly like the product will in the shop, with branded hangtags
and accessories. It may take months before orders are placed.
 Intermediaries (agents or traders/importers/private-label companies) resell your product to
buyers higher up the value chain. They are focused on low prices and require flexibility in
quantities and qualities. Some are located near or in the production countries and primarily
do sourcing and logistics, such as Li & Fung. Others, such as Broadway NYC

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Fashion and Trademark Textiles, work from Europe and also focus on market research, design
and stock-keeping.
Figure 1: The apparel market value chain
Search buyers that match your size, MOQ, quality and price level
Any type of buyer can be a good match if you can comply with the requirements the buyer has. You
need to study them, decide if you match and possibly develop your proposition if you want to have a
chance of doing business. Be aware that the COVID-19 pandemic may change buyer preferences (see
the CBI study ‘How to respond to COVID-19 in the apparel sector’).
If you are a small to medium-sized manufacturer in a developing country, intermediaries are likely the
most interesting type of buyer for you, followed by small to medium-sized brands (including niche
brands) and retailers in the medium to high-price segment. Bigger factories may focus on larger orders
for multi-brand online platforms and big-value brands and retailers, but only if they have the right
certifications and production efficiency. End consumers are an interesting target group, because of
increasing opportunities to reach them via online channels and potentially high profit margins.
However, end consumers often have complicated customer service demands (a return policy, for
instance).
COVID-19 and its effect on buyer preferences
Due to the COVID-19 pandemic, much of the European fashion industry has been in crisis mode during
2020 and 2021. European fashion retail is one of the worst-affected industries. Billions in orders were
cancelled in the early stages of the pandemic. Buying closer to the market, keeping stock as low as
possible, smaller orders, and faster delivery are a few of the solutions that European buyers are
looking for. If you are close to Europe and can deliver flexibility, you should advertise this.
Find a niche
Niche markets are relatively stable and will have less competition from other suppliers. Be aware,
however, that niche buyers have very specific product requirements. An interesting niche in the retail
market can be multi-product stores and sales points, such as gas stations, supermarkets, gift stores,

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tourist stores and DIY stores. Another interesting niche are specialised buyers, for example, in
workwear, performance wear, adaptive wear and promotional wear.
Tips:
 Before you approach any buyer, determine your USPs and define your ideal buyer.
 Do thorough research of the market your ideal buyer is operating in and adjust your
proposition to their requirements and ambitions.
 Read this article on Ecommerce News for a comprehensive overview of the European
ecommerce market, regional differences and opportunities, and the risks of selling online to
European end consumers.
 Read our studies on different niches in the European apparel market.
 Read the McKinsey report ‘ ’The post-pandemic state of fashion’ to learn about the influence
of COVID-19 on trends and developments in the European fashion industry.
2. Create a representative website and company profile
Many manufacturers in developing countries, and in Europe for that matter, still think a website or
online company profile has no priority. They are wrong. Being untraceable online is not only a missed
promotional opportunity, it is also a first hint to potential buyers that you run an unprofessional
organisation. Because building a professional website does not require large investments, this is an
excellent opportunity to distinguish yourself from competitors.
Tips:
 Hire a specialised company or freelancer that can design and build a professional website for
you. Ask for a design that can cross borders and cultures. For inspiration, check for
example, Denim Expert Limited, Crystal Group and Bitopi Group.
 Any website is as good as the content that is published on it. Hire a professional copywriter
for the texts and a photographer for company and product photos.
 Do not forget to advertise your USPs. Selling your company is even more important than
selling your product, so focus on certifications and CSR. For more information, read our report
on trends in the European apparel market.
 Note that a website requires maintenance. Designate an employee or freelancer to update
content regularly.
 Create a company profile. This is a short version of your website showing your company’s
USPs and sales strategy.
3. Promote your company online
Promoting your company online is one of the cheapest and most time-efficient ways of connecting to
potential buyers. After you have created a representative website, it is important to direct potential
buyers to it. There are several ways of doing this.
Social media
The most popular website for buyers in Europe to connect with other professionals is LinkedIn. If you
do not have a profile yet, sign up and make one. Use the company profile that you created (see above)
to make a LinkedIn company profile. Post articles or videos about new (product) developments in your
company or directly approach potential buyers. Find apparel professionals by typing in ‘apparel’,
‘fashion’, ‘design’, ‘sourcing’ or related terms in the search bar. You can also request to join specific
sourcing groups, such as the Apparel Sourcing Group (38,000 members) or Global Apparel and Textiles
Sourcing (21,000 members).
Successful company webpages on LinkedIn include:
 Denim Expert (41,000 followers)
 Raymond Limited (147,000 followers)
 Arvind (111,000 followers)

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Online search engines
Relatively few buyers use online search engines to find new suppliers. To attract the buyers that do,
make sure your website contains the term ‘manufacturer’ or ‘supplier’ plus the apparel items that you
are specialised in and the country you operate in. Do a Google search for the keywords above and see
which companies from your country are at the top of the search list. Try to analyse why the content
on their websites makes them attractive for Google and draw inspiration for your own company
website.
Paying for adds to promote your company
Before you decide to pay for adds on LinkedIn, Google or other online platforms, always do your math.
Find out what results you can expect, set specific targets and start with small amounts of money.
Websites like LinkedIn, Google and Facebook will let you target very specific groups based on very
specific keywords, which is great. The problem with paid adds is that the cost per click for the most
effective adds can be substantial. That is because the most popular terms are the most expensive,
because they attract the most competition.
Advertorials
An effective form of paid advertising is using advertorials to promote your business. Many popular
online industry websites such as Fashion United or country-specific websites such as Textilia
(Netherlands) will let you publish paid articles on their website or on their newsletter. These articles
can include photos of your company and products, or online videos, for example, about your
company’s ambition or vision of the apparel manufacturing business.
Tips:
 Create an online profile on LinkedIn, YouTube, Twitter or Instagram and post articles,
photographs and videos to draw attention to your company. Do not just publish uninteresting
pictures of factory buildings. Remember that online viewers are interested in new
developments in your products, company strategy, innovation, sustainability and people.
 Hire a professional copywriter, photographer or video editor to help create and publish
engaging content. Use Upwork or Fiverr to find suitable marketing professionals.
 Hire an online marketing professional to do a ‘keyword research’ for you. This will generate
ideas for articles and videos. Again, use Upwork or Fiverr and search for an SEO (search engine
optimisation) specialist.
 Follow brands, retailers and people on social media you are interested in working with. This
will provide you with company updates and news on their latest collections and travel
schedules. They might also follow you in return.
 Approach popular international trade media in your market segment and ask for the
possibilities of publishing advertorials.
 Create unique content that is not only focussed on promoting your company but also on
sharing your ideals and vision on the industry and global environmental developments.
4. Find potential buyers in online databases and on matchmaking websites
Several websites will let you search for potential buyers in a database of companies. Finding the name
of a retailer or brand is not the biggest challenge, however. Connecting to the right sourcing manager
in that company is. A great way to do this is to search on LinkedIn for sourcing managers at the
companies that you have discovered in an online database. Other websites are specifically built to
connect supply and demand in the apparel industry.
 Retail-Index is an online database with profiles of major apparel retailers in Europe.
The following websites are among the most used matchmaking platforms by European buyers. Here
you can sign up and connect with buyers that publish request for quotations. All websites let you sign
up for free. Some also have a paid membership service. In addition to promoting your offers, these
websites let you browse inquiries from buyers as well.

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 Alibaba – The world’s largest online B2B marketplace and one of the most popular platforms
in Europe. It lets buyers search for suppliers of many different products, not only apparel, by
country, product category, MOQ, total revenue and certifications. Alibaba supports many
different languages besides English.
 Foursource – Together with Alibaba, Foursource is the most used platform in Europe,
specifically for apparel sourcing. In has over 30,000 factories from more than 90 countries.
Foursource lets buyers search for suppliers by country, product category, MOQ and
certifications. It also offers manufacturers the opportunity to present their products in a
virtual showroom.
 Indiamart – Considered the world’s second-largest online B2B marketplace after Alibaba,
specifically built for suppliers from India.
 Fibre2Fashion Marketplace – Started in 2000, Fibre2Fashion is one of the oldest and biggest
online B2B portals specifically for the apparel industry. Next to matchmaking services for
products ranging from fibres and fabrics to accessories and machinery, it offers analysis
reports, consultancy services and a magazine.
 Sewport – Launched in 2017 as an online B2B matchmaking platform to help designers and
emerging brands find apparel manufacturers that can handle small to medium-sized MOQs, it
allows buyers to upload their sketches, tech packs and order quantities. Sewport has more
than 18,000 active brands and almost 1,200 manufacturers in its database.
 Apparel Buyer Contact – Not a matchmaking platform but a consultancy service selling
comprehensive lists of European apparel buyers, the actual people responsible for sourcing
apparel within European apparel companies, with their contact data.
Tips:
 Always fill out all the required fields in your company profile on an online matchmaking
platform. At the very least, mention the products you are specialised in, your target group
(men’s, women’s or children’s fashion, for example), segment (active, casual, formal wear),
product categories (such as outerwear, knit wear, skirts, suits), the average MOQ and any
management or CSR certificates you may hold.
 Invest in good product photography. Check, for example, how Zalando does it. Apparel items
should always be photographed in the same manner. Never present an expensive item in a
cheap manner.
 If the platform offers the possibility of writing an elaborate company profile, mention your
company’s history, USPs and growth strategy.
 If you are not competent in writing in English, hire a translator to fill out your company profile
for you.
 Regularly check the buyer inquiries on your matchmaking platform to discover what buyers
are looking for and what their requirements are. If possible, activate automatic notifications
for inquiries that match your offer.
Other interesting databases are the member lists of organizations concerned with sustainable
production. Clicking on the logo in the table below will take you to the members list of the
organization.
Table 1: Sustainable textile industry organizations and their members

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5. Visit the right online and offline events and come prepared
Trade fairs used to be the most important events for buyers and suppliers to meet and do business.
They are not that important anymore, as many buyers and suppliers have found other, more time-
and cost-effective ways to connect, like online. COVID-19 restrictions have amplified this trend. Many
trade fairs have moved to ‘virtual’ online matchmaking events, marketplaces, webinars and trade
shows. You can find them on the trade fair webpages (see below). Physical trade fairs can still be an
interesting way to find potential buyers, if you do it right.
The following trade fairs offer the best opportunities for connecting with European buyers. Every fair
has a specific target group.
Figure 2: As soon as the COVID-19 pandemic allowed, most trade fairs went back to physical events,
such as the Premiere Vision in Paris in September 2021.
Source: FT Journalistiek
Fibres
 Pitti Filati: fibre and yarn fair in Florence, Italy.
Fabrics
 Première Vision: Europe’s most important international fair for yarns, fabrics, accessories,
leather and trends in Paris.

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 Texworld: fair for fabrics, trims and accessories, held simultaneously with Premiere Vision in
Paris.
 Munich Fabric Start: fair for fabrics, accessories and innovations in Munich.
 Intertextile: fair for fabrics and accessories in Shanghai.
Leather
 Lineapelle: fair for leather, synthetics and accessories in Milan.
 ILM: leather goods fair in Offenbach, Germany.
 Gallery: shoes in Düsseldorf, Germany.
 ACLE: fair for leather, footwear and accessories in Shanghai.
 APLF: fair for leather goods, accessories and fabrics in Hong Kong.
Apparel manufacturing
 Apparel Sourcing: the biggest garment sourcing fair in Europe, with nearly 30,000 visitors in
Paris.
 Interfilière: fair for lingerie and swimwear in Paris.
 ISPO: fair for sportswear in Munich.
 A&A: fair for workwear in Düsseldorf, Germany.
 AFSW: biggest apparel sourcing fair in Africa, in Addis Ababa, Ethiopia.
Remember that participating in a trade fair can be a costly business. You need to hire a booth, prepare
a collection, and pay for transport, travel costs and working hours for yourself and your staff. To avoid
disappointments and lost investments, always come prepared.
Tips:
 For a comprehensive overview of online and offline fashion trade shows and fairs,
visit Fibre2Fashion or FashionUnited.
 Research the target group before you participate in a trade fair or an online matchmaking
event. Check the fair’s visitor numbers and main market segments. This will help you decide
which event you want to attend.
 Try to participate in trade fairs and online events that offer one-on-one matchmaking sessions
with buyers. Also create a list of potential buyers and inform them about your participation.
Do the same for current buyers.
 If you attend a physical fair, advertise your unique selling points clearly in your booth. Do you
offer low minimum order quantities? Super-short lead times? Specific certifications? Put it on
a sign and show it to visitors.
 If you attend a physical fair, try sharing a booth with another company to lower costs or
connect with an export coaching programme, for instance with CBI.
 Develop a new collection that includes both samples and fabrics. Collect special fabrics from
your different fabric suppliers. Do not use basic qualities. Collect different production samples
and focus on special styles that will attract buyers, while also displaying your technical skills.
6. Follow up on new contacts immediately
Your work as an exhibitor at a trade fair, online trade show or matchmaking event does not end when
the event is over. It has only just begun. Be quick to reconnect with potential buyers you have met.
Send them promotional materials, samples or answers that they have asked for.
Tips:
 After sending all the requested information and materials, do not wait for a reply, but plan an
online meeting. You can also plan a visit to the buyer’s office, if the situation allows for it and
you both feel comfortable travelling and meeting in person. In the meantime, your
prospective buyer can use your information to prepare questions, developments and orders.

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 Read our study ‘Doing business with European buyers’ to learn how to use new contacts
effectively.
 As online meetings have replaced physical contact during the COVID-19 pandemic, it is wise
to invest in a reliable Wi-Fi connection and the right software. Many popular online
conferencing programmes such as Google Meet and Zoom are free to download.
Figure 3: If you get questions via email, always confirm within a day, even if it is just to announce
that you will respond in more detail later.
Photo by Brett Jordan on Unsplash
7. Find buyers via sector associations
Sector associations in the apparel industry represent and support member companies. In many cases,
this includes providing information on sourcing issues, so this means opportunity for you to connect
with potential buyers. Select a sector association for the companies you want to target and ask the
association for possibilities to publish an introduction in their newsletter, or to participate in a
matchmaking event. Most associations publish a list of members online, which is an easy way to gather
data on potential buyers.
The following sector associations are the most important in Europe. They represent different
international and national markets and market segments.
 The International Apparel Federation represents sector associations, brands and
manufacturers in trade and sourcing issues.
 The European Branded Clothing Alliance represents more than 60 member companies.
 Eurocommerce represents the interests of 31 big retailers and wholesalers and 13 retail
federations in Europe.
National sector associations:
 German fashion represents the German fashion industry and the interests of its 350 member
companies.

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 The Fashion Council Germany is another German association, supporting more than 100
German fashion brands and retailers.
 The FHCM is the French sector association for high-end apparel brands.
 The UK Fashion and Textile association represents more than 400 fashion brands and
designers in the UK.
 Mode Suisse represents the interests of companies in the Swiss textile industry and retail
market.
 The Association of Swedish Fashion Brands represents the interests of 70 Swedish fashion
brands.
 Modint is the sector association for Dutch apparel companies focusing on wholesale and
manufacturing.
For an overview of national sector associations, check the member page of Euratex, the European
confederation of textile and apparel associations.
The following are sector associations for specific apparel markets or niches:
 PCIAW is the international sector association for workwear. It offers a buyer’s forum for
members.
 COTANCE is the representative body of the European leather industry.
 Children’s Fashion Europe promotes the interests of children’s fashion companies in Europe.
It is formed by several national children’s fashion associations.
 United Fashion is an independent platform connecting manufacturers to independent
European designers and start-up fashion labels.
Tips:
 Contact the sector associations in your target market or market segment and ask about
different service models for matchmaking.
 Most associations send out monthly newsletters with relevant industry updates. Sign up for
these publications to stay up to date with developments in the industry.
 Search for sector associations that cater to your needs by searching online for your niche,
using terms like ‘industry group’, ‘federation’, ‘platform’ or ‘institute’.
 A good listing with sector and industry associations in your home country can also be very
useful in connecting with European buyers. Buyers may attend a(n online) sourcing mission to
your country and one of their first steps will be to contact the sector and industry bodies in
your country.
 If needed, become a member of a sector association to access membership lists and
participate in matchmaking events.
8. Let support organizations help you find buyers
Several international support organizations support the apparel industry in developing countries with
export coaching. These organizations are funded by different governments and deploy sector experts.
Participating in developing country programmers is a good way to develop your business potential in
the European market. Because of COVID-19 travel restrictions, many support organizations have set
up online matchmaking events and coaching programmers. Register for such online events. For the
time being, they are the only way of connecting.
Tips:
 In addition to market intelligence reports, CBI offers export coaching, including marketing
advice and matchmaking to SMEs in 35 countries. Check CBI’s website for an overview of
current apparel programmers.
 Other organizations that regularly offer coaching programs for apparel exporters in
developing economies are the UNDP, DFID, DANIDA, ITC, GIZ, SIPPO, ICCO and Solidaridad.
 PUM is a Dutch NGO that offers practical support by senior apparel industry experts on
anything from business process management to arranging your exports.

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 Investigate if your country has a support organization for exporting apparel to Europe, such
as India’s AEPC, Egypt’s ETDA and Ethiopia’s ETIDI. Also check your local chamber of
commerce. Buyers interested in sourcing apparel from your country will approach them for
factory information.
 Connect with different NGOs active in your country and ask if you can join an export coaching
programed.
9. Set up a dedicated marketing and sales team
In many factories in developing countries, marketing and sales is done by one person: the CEO. This
should be avoided. Developing and executing a successful marketing and sales strategy is too much
work for one person. Secondly, marketing and sales require expertise and experience. Marketing is
promoting your organization. Sales has a clear focus on business development and buyer relationship.
Both disciplines are highly specialized.
Tips:
 Create a clear marketing strategy that is in line with the company strategy and that supports
your sales targets.
 Do not think you can represent and promote the company on your own if you also have other
managerial tasks in your company. Marketing and sales is a continuous effort. You will most
likely lack the time to do everything by yourself.
 Hire a specialist to help develop and execute both your marketing strategy and your sales
strategy. As online marketing is becoming more important, search for a specialist with
expertise in online marketing.
 Marketing can be outsourced to a marketing agency, but always discuss and define clear
targets to make sure your expectations will be met.
10. Hire a sales agent or representative
Developing and maintaining relationships with new buyers is a continuous, long-term process. A good
way to do this is to employ a local sales agent or representative. The trend is that more and more
manufacturers invest in sales offices and showrooms in Europe and employ representatives. COVID-
19 travel restrictions have made this extra urgent. Do not think, however, that anybody with a large
network in Europe will get you easy orders. There is no such thing as an easy order. Prepare for a long-
term investment in sales.
Figure 4: Because sales is a long-term process, having a local representative can make it easier for
you to find new buyers.
Photo by LinkedIn Sales Solutions on Unleash

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Tips:
 Find sales agents or representatives on LinkedIn. Search for ‘sales’ plus the term ‘apparel’,
‘fashion’ or the particular apparel item that you want to export. Try to find a sales
representative for each country you want to export to, because most sales agents have a
network limited to one country.
 Another good way to find a sales agent is to approach a European headhunting company and
ask them to connect you to any apparel sales agent that has recently retired. These people
often have a large network, and plenty of spare time. With a compelling story, you might get
them to work with you. Dutch NGO PUM is another good source for finding senior apparel
industry experts with a large network that can help you.
 In case you consider setting up a local office or showroom or employing a sales agent, but the
costs are too high, try creating a collective with other exporters so you can share the expenses.
 Train your sales agents in both manufacturing and cost calculation. This will make it easier for
them to negotiate successful business deals.
 Define clear and realistic sales targets that you can measure and guide.
Order procedure for apparel business
During the execution of a garment order, the following processes should be maintained by a garments
merchandiser:
1. Order inquiry from buyer to factory,
2. Approval of order from the buyer,
3. Buyer bank gave master L/C to the buying house,
4. Back to back (B/B), L/C is given to the suppliers,
5. Fit sample sent to the buyer for the fit approval,
6. Pre-production (P.P) sample submitted to the buyer,
7. Fabrics and accessories should be in-housed according to the T/A plan,
8. Pilot production should be started according to the T/A plan,
9. Online inspection by the buyers Q.C,
10. Bulk production should be started according to the T/A plan,
11. The commercial department prepares the shipping documents,
12. Final inspection according to T/A plan,
13. Goods sent to port (Seaport or airport),
14. Goods handed over to the shipping line.
All the above processes are discussed below:
1. Order inquiry from buyer to factory:
Here, a merchandiser must make a meeting with the production manager for shipping date planning,
Enquiry on price (Sometimes target price given by the buyer), inquiry on shipping date (Sometimes
target shipping date giving by the buyer).
2. Approval of order from the buyer:
In this process, a merchandiser has to take the approval of order as per the costing given by him/her,
also make time and action (T/A) plan containing the details of the action be taken according to the
fixed shipping date, to execute the shipping date committed with the buyer.
3. Buyer bank given master L/C to the Buying house:
Master L/C is the contract, given to the bank, which covers the total value of an export order. The
commercial department of buying house deals with the follow-up of L/C matter.
4. Back to back (B/B) L/C is given to the suppliers:
Here, the commercial department of buying houses deals with the open up of B/B, L/C, and
merchandiser deal with the follow up of materials on time.
5. Fit sample sent to the buyer for the fit approval:
In this process, the merchandiser has to co-ordinate with the sample section for making a fit sample.

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After receiving it from the sample section, it should be sent to the buyer for the approval of fit and
measurement.
6. Pre-production (P.P) sample submitted to the buyer:
Here, a pre-production (P.P) sample should make from the production line by using the original fabric
and accessories and submitted to the buyer for P.P approval.
7. Fabrics and accessories should be in-housed according to the T/A plan:
In this process, a merchandiser has to monitor the inventory department strongly so that there’s no
problem can create during in-housing right quality and the right quantity of fabrics and accessories in
a timely. If there’s any wrong then merchandisers have to take the correct decision to solve it.
8. Pilot production should be started according to the T/A plan:
Pilot production means initial production, consists of 100 to 200pcs. Here, the production manager
and the quality team should check very carefully every style of clothing according to the buyer’s
specification.
9. Online inspection by the buyers Q.C:
Here, the buyer’s Q.C team inspect the garments and gives suggestion where the quality defects are
and how to improve on that.
10. Bulk production should be started according to the T/A plan:
In this process, bulk production should be started and complete according to time and action plan.
Here, buyer’s QC, monitor on the production line. So, the production manager should take extra care
to make the garments correctly by maintaining the buyer’s specifications.
11. Commercial department prepares the shipping documents:
In the meantime, the commercial department should prepare the necessary shipping documents such
as booking vessels by contacting with shipping line (in case of sea shipment).
12. Final inspection according to T/A plan:
In the final inspection, the buyer’s Q.C has done a random inspection before the shipping date. If the
buyer’s Q, C confirmed the right quality certification then only can ship out the goods.
13. Goods sent to port (Seaport or airport):
Goods should send to the seaport or airport according to the buyer’s specification.
14. Goods handed over to the shipping line:
Goods handed over to the shipping line (in case of sea freight) is a very important process, if it’s not
possible to hand over the goods to the shipping line at right time according to the master L/C then the
buyer can cancel the goods or ask for air freight. So, goods should be handed over in a timely.
Legal requirement for apparel business
LICENSE AND REGISTARTION PROCESS
For setting up any garments factory in Bangladesh, it generally starts with the registration of a
company at the Registrar of the Joint Stock of Companies also known as RJSC. The options are a public
or a private limited company. Public limited companies have the option of raising funds from the public
by selling shares where as private limited companies have their set list of shareholders. For any
company, the process starts with a Name Clearance Certificate and so on and so forth as per the
required document list of the RJSC for incorporation of the company. The companies’ ownership and
operation are defined in the Articles and Memorandum of Association.
When foreign shareholders are involved, the document requirements will differ depending on the
requirements of the RJSC. Foreign owners have the option of opening a subsidiary company which
would be a limited liability company where the ownership will belong to the parent company.
Once a company has been set up, the next requirements are related to licenses for setting up factory.
Depending on the type of operations the following is a rough list of the licenses that may be required
by garments factory for operation. This list is non-exhaustive:
1. Export Registration Certificate (E.R.C)
2. Import Registration Certificate (I.R.C)
3. Factory Layout Plan Approval.

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4. Fire License.
5. Factory License
6. Environment Certificate.
7. Membership of the Chamber of Commerce.
8. Membership & certification of Bangladesh Garments Manufactures & Exporters Associate
(BGMEA)
9. Value Added Tax Registration Certificate.
10. Trade License.
11. Export Promotion Bureau Enrolment Certificate.
12. Tax Identification Number. (TIN)
13. Bank Solvency Certificate.
14. BOND License & General BOND (if applicable) etc.
Buying houses play a big role in the garments industry. Some of the bigger brands around the world
place order in the local companies and factories through buying houses. Buying houses can be set up
in the form of a Sole Proprietorship, Partnership or Company. The Sole Proprietorship is the simplest
form of ownership for which the owner will be responsible for all the liabilities i.e. profits, dues and
taxes. It can be set up by simply purchasing a Trade License which has to be annually renewed.
Partnerships in Bangladesh requires a minimum of two to the highest of twenty partners. It can be
executed by a partnership agreement registered with the RJSC. There is also the option of setting up
a buying house in the form of a subsidiary company with its’ share being held by the parent company.
However, most foreign owners prefer having a branch office or liaison office specifically for this
operation. Such branch/liaison office is required to obtain Bangladesh Investment Development
Authority (BIDA) permission to run business.
Other than that, any foreigner, who is willing to work in Bangladesh must have a Work Permit. The
process starts with an application to BIDA for an E-visa recommendation with all the requisite
documents recommended by BIDA. Once the recommendation is received, the expatriate is then
requested to apply to the respective Bangladesh Embassy or High Commission in their country with
their recommended documents to receive the initial E-visa which the expatriate will use to travel to
Bangladesh. The tenure of this visa is usually Three to Six months. Once inside Bangladesh, the
expatriate will then have Fourteen days to apply for a Work Permit to BIDA with documents as per
BIDA’s recommended list. The Work Permit is approved by an inter-ministerial meeting at BIDA usually
for a period of One year. Once the Work Permit, is approved, it automatically triggers the process of
the Security Clearance, which is then conducted by the National Security Intelligence and the Special
Branch of Police. They perform the necessary checks and publish the name of all the expatriates who
have been cleared. Only after the Security Clearance is obtained, the expatriate can extend the initial
E-visa to the whole period of the Work Permit. Similarly, there is the FE visa which is required for any
family members joining the expatriate in Bangladesh.
LEGAL ISSUES
As mentioned above, the whole process has a lot of legal issues from the beginning to the end. Outside
the registration and licenses, there are issues of land acquirement, which involves acquiring proper
land with the right documentation for the factories to be set up. Usually setting up factories requires
quite a bit of land. It is necessary for the ownership and title of the land to be transferred properly to
the factory owners who intend to own land to set up factories. Therefore, it is necessary to conduct
land search to check the ownership of the lands, to verify the title and interest of the rightful owners
as per the laws of Bangladesh. In order to transfer the ownership of the land, it is necessary to execute
and register the sale of deed & change the records in the name of the new owner (known as Mutation)
as per the laws of Bangladesh.
Legal issues arise from implementation of the banking laws, as there are lots of foreign transactions
involved in the garments industry. For example, when the materials for the garment are bought from

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outside the country, the company has to open a Letter of Credit and thus the banking regulations
specifically with regards to foreign exchange comes into play. The same way, when the ready-made
garment is sent to its’ customers, the foreign currency has to enter the country in a safe manner.
Bangladesh Bank plays a major role in regulating these transactions under the foreign exchange
regulations of Bangladesh.
There are legal conundrums arising out of the contracts. There are lots of bi-lateral agreements signed
between different countries and disputes are common when deadlines are not met. Claims arise from
parties in Bangladesh, for example: against a party who was supposed to send a particular material in
time but failed to do so. The same way foreign companies may claim against Bangladeshi factories for
not delivering on time. Since, most of the garments materials and the garments themselves are
transported by ships and by air cargo, sometimes legal implications with regards to transportation of
goods by cargo arise from these consignments. Most of the legal disputes involve breach of
international commercial contracts and such disputes are generally resolved through international
arbitration.
Quite naturally with the high number of workers involved in the industry, legal issues arise often
regarding termination, unfair dismissal, leaves, payment etc. In recent years, working environment
has become very important for the workers and compliance departments. It is necessary to comply
with the working hours, number of leaves, all employment benefits, termination benefits, trade union
issues, workers’ welfare matters etc. under the Bangladesh Labour laws. The Department of
Inspection for Factories and Establishments (DIFE) is the statutory body who has the authority to
monitor all labour related issues.
Due to the large scale of the business all around Bangladesh, and because the RMG sector is deeply
rooted with the Textile industry there are environmental implications stemming from their operation.
Even though Environment Clearance Certificates are a necessity while setting up a factory, it is not
uncommon to see legal implications arising out of this.
Introduction of FMA and its services
FMA is one of the best law firms in Bangladesh with extensive experience in working with the garments
industry with clients both foreign and domestic. FMA has established an extremely reliable image with
its’ work over the tenure of its’ existence. FMA being a full-service law firm, can provide legal
assistance in almost all areas of the RMG industry from setting up a company starting from the name
clearance to drafting of the company articles and memorandum of association and registration with
the RJSC. FMA also provides support in obtaining all sorts of licenses including I.R.C, E.R.C, VAT, TIN,
Trade License etc.
FMA also specializes in all sorts of immigration matters with regards to expatriates and provides
support in obtaining the E-visas, FE visas and the Work Permit. FMA works with some of the biggest
firms both local and foreign with regards to their expatriates. Also, services like assistance with
obtaining encashment certificates and account openings are provided. FMA has a whole wing
dedicated to the financial and taxation issues which can take care of all the tax matters, payroll etc.
FMA’s expertise in labour issues are unparalleled regularly providing advice on all sorts of labour issues
including termination, payments etc. FMA’s legal team consists of some excellent lawyers who can
efficiently represent any aggrieved in the court system of Bangladesh regarding any labour, contract
or relevant issue related to the RMG industry.
Most importantly, in the RMG sector, since disputes quite regularly arise between entities in different
countries and time is usually short to sort out these issues, parties generally opt for alternative dispute
resolution. FMA has a very capable team for representation in arbitration, mediation and negotiation.
All in all, FMA is a total service provider for sorts of legal issues.
COVID-19 impact on business
Bangladesh has since its’ inception, never faced a crisis so unique. The resulting effect on the global

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economy has been devastating. Locking down and quarantining the mass has been a challenge in its’
own right. RMG sector in Bangladesh has taken the largest hit at over USD 2.5 Billion in cancelled
orders approximately already.
The cancelled orders along with the very important requirement of social distancing has probed a lot
of factories to shut down operation completely. For the first time in the history of the RMG sector,
most of the factories have shut down in unison without any further notice of when they might re-
open. This is a new and challenging territory both logistically and legally. For instance, what happens
now to the workers? Do they get paid for their jobs, do they lose their jobs or does it stay in a stalemate
situation?
The good news is that the government has declared incentive packages for the RMG sector which will
enable them to pay the labour for the upcoming months, however, this pandemic can extend beyond
that period and the effect of that is already visible. The labour laws of Bangladesh provide a lot of
protection for workers from wrongful termination and has laws in place for lay-off situations and what
kind of payment the workers can receive under these circumstances. In case of lay-off, the employees,
who have completed at least 1 (one) year of service shall be entitled to the amount of compensation
which shall be equal to half of the total basic salary of the employees and equal to the full amount of
housing allowances that would have been payable to them if they had not been so laid-off.
Retrenchment is an option available to the Employer after the initial lay-off period of 45 days.
Retrenchment can take place on the ground of redundancy which means the owner can declare that
there is no work available for the workers, and thereby, they may be retrenched.
In summary, under this current unforeseen crisis created by the Novel Corona Virus, it is extremely
difficult to evaluate what kind of situation the RMG sector will face. It has already costed billions to
the economy. Work needs to resume soon enough to recoup the losses from this sector but since it is
a labour intensive industry, the fight is presently more for life than the economy.
Taxation
General rate of tax is 32.5% currently in the laws of Bangladesh. Nominal requirements for a limited
company formed locally includes a number of reporting to be done to NBR, such as: Opening a TIN,
Monthly Tax deduction statement, Half Yearly Withholding Tax statement, Yearly statement related
to tax return submission of its employees, Yearly statement related to salary disbursed from company
to its employees, Quarterly Advance tax deposition, Yearly Tax return submission, attending
appeal/hearing session as required on behalf of the company, Monthly VAT return etc. FMA can advise
and assist to satisfy all regulatory compliances to enable the company to run smooth and hassle free.
Conclusion
In conclusion, the RMG sector is still one of the booming sectors in the country. Bangladesh
government has been very supportive of this sector which is why it has declared the opening of new
export processing zones. Also, the government has mandated a deep sea port and another airport
along with heavy investment on internal infrastructure, which means that trade will become even
more easier in the near future. Bangladesh government is also encouraging foreign investors to invest
in Bangladesh. Considering the condition of the sector, this might not be a bad idea.
EXECUTIVE SUMMARY
The Ready-Made Garments or RMG sector is the highest exporting sector in Bangladesh. The sector
has grown over the few years like clockwork and still making steady progress. The RMG industry is a
very labour intensive industry with factories all over the country. It is an industry where local and
foreign investors have made huge investments.

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It is not the hardest industry to enter especially in Bangladesh, where the Government has been very
forward thinking regarding this sector. Outside the general industrial zones, the government has
developed export processing zones to help increase the productivity of this industry. Once a company
is formed with the Registrar of Joint Stock of Companies, the establishment of factories requires a
number of licenses from different departments of the government to ensure health, safety and good
working environment for the labour and the business overall. Textiles and buying houses also play
major roles in the RMG industry, one bringing orders for the factories while the other providing raw
materials.
The RMG sector is related to a lot of other industries which directly affect its outcome, especially
import/export, labour and banking etc. Based on that, the legal issues involving the RMG industry has
also been huge. From the creation of a company, to setting up the factory, which is the minimum of
the ground work any entity has to do to survive in this sector, there are lots of legal services to be
provided especially with regards to the licenses, for example, trade license, TIN, VAT, I.R.C, E.R.C etc..
In addition, because there is a huge amount of foreign investor coming in to invest in this particular
area, there is a presence of expatriates, who require work permit to work in the country.
FMA is one of the finest full-service law firms in Bangladesh well capable of providing any solutions in
the legal industry for the RMG sector. FMA has a lot of experience with the setting up of companies
and obtaining licenses as required in this case. FMA also has teams dedicated to the immigration
matters of expatriates and for the financial department which works matters such as taxation and
payroll etc.
Even with the recent outbreak of the Covid-19 and its’ profound effect on the RMG sector, it is still
the best sector to invest in Bangladesh. The Government of Bangladesh has been forward with this
sector and it can only flourish going forward. For all your legal issues, FMA has the answer.