RFL now produces footwear for H&M, Kappa, REDTAPE, Umbro, PEPCO
Its footwear export crossed $7.2 million in FY 2022-23. In the current fiscal year, it could be $15 million
Highlights
- H&M is the first major global brand to source non-leather footwear, produced by Pran-RFL.
- Exports jumped from $4.7 million in 2021-22 to $7.2 million in 2022-23
- It is expected to reach $15 million this year.
- The company aims to reach $50 million in exports within 5 years.
- Tk138 crore invested to establish 10 production lines for various brands.
- Tk100 crore further investment to expand production capacity
- 2,500 workers employed in the factory equipped with modern machinery
Swedish fashion giant H&M has so far been a major buyer of clothing from Bangladesh; now it also seeks to focus on sourcing non-leather footwear from the country.
Pran-RFL Group's factory in Kazirchar near Dhaka will be catering to the demand of the fashion giant for non-leather footwear, alongside 10 other global brands, including Kappa, REDTAP, Umbro, PEPCO and Airness.
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Pran-RFL started production on a small scale in 2021 and their shoes quickly gained traction with global buyers.
According to Pran-RFL Group officials, the company has invested Tk138 crore to set up 10 production lines, currently producing 72 lakh pairs of shoes annually. To meet the growing demand, the company is expanding its capacity with an additional Tk100 crore investment.
Md Rahat Hossain Roni, chief operating officer of RFL Footwear, said the company aims to increase exports from $4.7 million in FY 2021-22 to a staggering $50 million in the next five years.
Its footwear export crossed $7.2 million in FY 2022-23. In the current fiscal year, it could be $15 million.
The target aligns with their vision of establishing footwear as another major export industry for Bangladesh, similar to the success of the garment sector.
In a visit to the Pran-RFL factory on Saturday, The Business Standard saw a well-organised factory with modern machinery for the 2,500 employees, catering to global brands. Modern machinery ensures efficient production of sneakers, ladies' shoes, sandals, and children's footwear.
The company prioritises worker hygiene and employs three foreign experts to ensure adherence to international quality standards. Separate production lines and warehouses are dedicated to H&M, showcasing their commitment to meeting buyer requirements.
Rahat Hossain Roni said sustainability is also a key focus for RFL, with GRS and RCS certifications paving the way for further export opportunities.
The company's non-leather footwear exports have reached 37 countries within two years, its officials say.
Ahsan Khan Chowdhury, chairman and CEO of PRAN RFL Group, envisions exporting to almost all countries soon.
He, however, acknowledges the challenge of sourcing raw materials like synthetic, rubber, and plastic, currently heavily reliant on imports.
Currently, Bangladesh's share of the export market of $400 billion is very insignificant. Footwear will be another garment industry for us if the initiative is taken well.
Acknowledging the challenges, he said to overcome the challenges, backward linkage development is crucial to reduce costs and compete with China.
Currently, garments account for 80% of Bangladesh's export earnings, footwear contributes only 3%. However, the share of Bangladesh in the global footwear export market is less than 1%.
According to the sector concerned, non-leather footwear exports reached $480 million in FY 2022-23, and Bangladesh now ranks 16th in global footwear exports. China is at the top.
In total, Bangladesh exported leather and non-leather footwear shoes worth about $1180 million last fiscal.
According to an analysis by Bloomberg, major brands such as Nike, Adidas and Puma, H&M are planning to decrease their business in China and increase sourcing in South Asian countries including Bangladesh, India, and Pakistan as a way to reduce costs. They hope that exports of non-leather footwear from Bangladesh will reach $1 billion by 2027.
Apart from PRAN-RFL, currently some local companies, including Bengal Leather Complex, Sunirvas Footwear, Muff Shoes, Craftsman Footwear, Karnaphuli shoes, Fortuna Leather Craft, export non-leather shoes.
