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Eid-ul-Fitr sales: The lifeline of local fashion houses

  • Published at 01:41 am June 25th, 2017
  • Last updated at 03:35 pm June 25th, 2017
Eid-ul-Fitr sales: The lifeline of local fashion houses
Bangladesh's local fashion brands live on sales ahead of festivals, especially the Eid-ul-Fitr, as the lion's share of their annual profits come from seasonal sales. These seasonal sales are responsible for most of the profit, with the Eid-ul-Fitr alone contributing to about 40% of the profits of leading brands, according to Fashion Entrepreneurs Association of Bangladesh (FEAB). Other festivities like Pohela Boishakh, Pohela Falgun, Ekushey February, Independence Day and Victory Day. However, it is different for less prominent brands which make up to 80%-90% of their annual profits from the Eid sales. “Throughout the year, we register good sales and it picks up during the festival,” Rezaul Karim, Anjon’s Mirpur branch in-charge, told the Dhaka Tribune. “Of the total profits, about 40% come from Eid sales, about 10% from Pohela Boishakh and the rest from other festivals since we have sales on more or less every occasion,” said Rezaul. After Eid, sales plummet and it becomes very difficult to reach sales targets. “Profits from the festival sales are higher than normal sales. It is common that a brand sells products at twice the price,” a sales executive from a renowned shop at Bashundhara City told the Dhaka Tribune. Since people receive Eid bonus from their employers, they are able to spend more money. More money equate to more disposable income, hence brands find an opportunity to overcharge products. While established brands thrive on seasonal exploitation, less renowned brands find it difficult to break even, much less make a profit. [caption id="attachment_71254" align="aligncenter" width="900"]20170622-Mehedi-Hasan00006 FEAB data says the annual turnover of the fashionwear sector is about Tk6,000cr and there are at least 4,500 fashion houses in the country. The photo was taken recently at Bashundhara Shopping Mall in Dhaka Mehedi Hasan[/caption] Md Anisur Rahman, Mirpur branch manager of Grameen Mela, said: “Our sales throughout the year run the business from hand to mouth. Festival sales like Eid-ul-Fitr are the only way we can imagine making a profit.” About 90% of the annual profits come from Ramadan sales. But imports from India, China and Pakistan have cast shadow on businesses recently, said Liton Das, in-charge of Meghla Fashion’s Mirpur Branch. Fashion brands usually design products with their own resource and designers. But there are others who outsource or base their designs on others. “Years back, foreign fashion brands dominated the domesticate market and the lion’s share of the demands were met by imported goods,” Shameem Ahmad, vice president of FEAB told the Dhaka Tribune. But over the past several years, domestic fashion brands have generated sufficient buzz to meet the greater share of the clothing demands. Even then, the Eid sales remain the main source of profits, said Shameem. He also says that domestic fashion brands have become increasingly competitive, improving their products and thereby attracting more buyers. FEAB data says the annual turnover of the fashionwear sector is about Tk6,000cr. There are at least 4,500 fashion houses in the country, employing nearly five million people, 70% of whom are women. According to Bangladesh Dokan Malik Samity, the Eid-ul-Fitr sales value of all products is about Tk20,000cr. As the number of middle income groups increase in the country, and newer generations find themselves sensationalised by the unique marketing of local brands, domestic sales will continue to increase. The middle income groups and the younger generations are the main client base of domestic fashion brands. “A person’s fashion sense will dictate what they will buy for Eid,” Natasha Khondakar, a private service holder told the Dhaka Tribune. “I myself prefer local brands because they are not only unique but also of really good quality. They are stylish, dependable and made in Bangladesh,” Natasha said. “Since Eid is the biggest festival, I have to buy 15-20 dresses for my relatives. Compared to other festivals, I spend a lot more during Eid,” said Shamsun Nahar, a homemaker told the Dhaka Tribune.