Sad demise of a giant garment maker

When Opex Group announced that it was no longer able to manufacture apparel products in its Kanchpur factory complex, it marked the end of an era in the world of garment industry.

Many businesses who became garment entrepreneurs seeing the success of the Opex Group are saddened to know the sad demise of a giant garment factory, not only in Bangladesh but also in Asia.

“It was not very unexpected,” said Mohammad Hatem, executive president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA).

“Opex has a big contribution to the development of the country’s garment industry. Labour unrest and poor supervision by managers are blamed for the demise of the once-very successful venture,” Hatem told the Business Insider Bangladesh on Friday.

Anisur Rahman Sinha established the first garment factory in 1984 when there were only a few factories in the country. Later, he expanded the factories and made Opex one of the largest garment manufacturing conglomerates in Asia.

According to the company’s website, Opex has a complete vertical-integrated setup in woven, denim, outwear, knitwear and sweater with the most modern state of the art machinery from the USA, Europe and Japan. Once the group employed 45,000 workers, the largest in the country.

Opex was the largest garment exporter of Bangladesh for many years since the 1990s. When it exported $300 million to $400 million worth of garments a year, there was hardly any local exporter who earned $100 million.

Even today, according to the company’s website, Opex has an annual turnover of $500 million (Tk4,250 crore) and $300 million (Tk2,550 crore) annual export.

One will understand to see the buyers’ list of Opex that includes LEVI’S, VF, AMERICAN EAGLE, NAUTICA, JCPenney, TARGET, PVH, GAP, HANES, HAGGERS, PERRY ELLIS, SEARS, OXFORD, AEON (Japanese), H&M, OVS, Macy, NEXT, OSHKOSH etc.

How things turned so bad…

Baniz Ali, acting director (administration) of Opex and Sinha Textile Group, in a notice on October 18, said owners of the group have been incurring losses since 2012. Even then, owners were running the factories by borrowing and selling properties.

But the coronavirus pandemic has made things further worse as export orders declined significantly, he said.

“Sometimes labour unrest forced the management to shut the factories and it affected the company’s business,” Ali said.

Amid this situation, owners of the group have decided to shut the factory complex permanently from October 19 as per Bangladesh labour laws 2006, he said.

Opex has also sent the factory closure notice to the BGMEA and the BKMEA, the two largest trade bodies in the apparel sector, and Narayanganj district administration and the department of factory inspection.

According to Mohammad Hatem of BKMEA, Opex needs Tk 40 crore to Tk 45 crore to pay off all dues of its workforces.