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Identification of strategical solutions for Apparel Industry, Sri Lanka
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APPAREL INDUSTRY SRI LANKA
Ravi KumudeshUniversity of Colombo
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Apparel Industry in Sri LankaHistory
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Before 80s
Independence
Tea, Coconut & Rubber
Becoming a Republic
Self sufficiency motive
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Late 70s and Early 80s
Open Economy
Rapid Changes
Insurgencies
Investments Slow Down
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Late 80s
Insurgency – again!
Industries in Trouble
Lack of Investments
Slow Growth
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Early 90s
Change of Leadership
Focus on Development
200 Factory Program
Sri Lanka becoming a Garment Country?
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Caught up in Y2K!
Truce & Short term Boom!
Tsunami!
Change of Leadership
End of Quota!
New Millennium
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Apparel Industry in Sri LankaProspects and Challengers
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Factors Moving Towards the Growth
Human Resources Skilled Labor Motivation Abundant labor force
InfrastructureGovernment policies
Custom procedures International agreements
Factors Moving Backwards the Growth
Increased Production Cost High Lead Time Emerging Market
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Export of Apparel 2007 - 2012
Rivals in Apparel Industry
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Foreign RivalsIndiaChinaBangladeshVietnam
Contribution to GDP
Gradual deduction of GDP
contribution Reflection of GDP
Less domestic value added as 65% of material inputs are imported.
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Potential Competitors
China Low production cost with quality and speed High backward and forward linkages Establishes as global supplier
Bangladesh / Vietnam / Turkey Low labor cost Low utility cost
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Apparel Industry in Sri LankaSolutions
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Opportunities
1. High industry attractiveness2. Effective Multi Fiber agreements3. Emerging economies of Eastern countries4. Strategic location and connectivity
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Threats
1. Cheap labor in competitive countries2. European Economic recession3. New entrants within supplier/distributors’
countries4. Rapid development in retail industry5. Removal of GSP
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Strengths
1. Reputation in industry
2. Compliance with international labor laws
3. Supportive government policies
4. Educated, adaptable workforce
5. Fast developing infrastructure
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1. Increasing labor cost2. Lack of geographical diversification3. Absence of prominent local brands4. Higher utility cost5. Social perception6. Labor turnover and absenteeism
Weaknesses
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