Direct technical assistance from the Project appears more market oriented and this Isn’t contrary to best practice intervention. JOBS provided initial technical assistance and skills training In coordination with multiple lead firms to develop of skilled shoe producers for the group.
Since then, Apex and other lead firms have realized the benefit of strategic investment In providing embedded forms of BEDS to cluster members through backward linkages, such as conducting market research , competitiveness strategy and stimulating supplier-provider links along the supply Hahn. 2.Direct technical assistance was UN- Justified in facilitating market linkages. Facilitators apply a variety of demand- and supply-side interventions to overcome market inefficiencies and constraints. Direct service provision is typically left to BEDS providers as a business transaction. The different approaches undertaken by the JOBS project.
Under the Modular and Apex Footwear the JOBS Project applied direct technical assistance to the lead firms and producer organizations with producer group formation and producer-market linkages. 3. Apex Delhi Footwear Limited (FALL) has unfavorable market and operating environment. 006 has been a very eventful year in Bangladesh and for FALL, as they have had to face and counter a diverse set of market conditions. There was an artificial price hike, which remains unabated till today. Globally there has been also a price hike for raw cow skins due to increased demand and static or even diminishing supply, but the cost increase of Bangladesh cow leather has been abnormal.
It has impacted profitability,delivery and supply has also been very erratic. 4. An effect from the late arrival of export orders. It reduced their lead times to turn around and produce the shoes for export, as delivery dates remained the same.This forced them to use air freight much more aggressively in importing required components and tools for production, especially in the beginning. Which increase their cost and put them face downward pressure so there was a chance to reduce the quality.
5. Faced with unprecedented labor unrest In June and July 2006. The attacks and damage to factories by some disgruntled workers as well as some unknown outsiders ritually brought Industrial production to a standstill, especially in areas where there are large numbers of export oriented garment factories.In many cases factories were attacked by outsiders and persons with ulterior motives and created a sense of panic industry.
6. Delays in production caused by late arrival of orders Subsequently delays in production caused by late arrival of orders, late arrival of raw materials and then lost production days caused by labor trouble all came to a head in September when they were forced to make several shipments by air and also offer rice discounts to customers to compensate for late deliveries.Because of the late arrival of orders it hampers in footwear industry in the production. They couldn’t produce in time.
7. They experienced unprecedented political turmoil in Bangladesh which also caused loss of production days, shut down of Chitchatting port, delays in clearing imported raw materials and container congestion for export. In October alone they had 6 days holidays for Ramadan and Did, 2 days shut down for major political violence, and 2 weekly holidays. As a result we were only able to work 21 days in a month of 31 days.
In November there were only twice for a total of 9 days. 8. The severe load shedding and power shortage in 2006 also caused production losses as well as damage to machinery. The severe load shedding and power shortage in 2006 also caused production losses as well as damage to machinery. Even though they have sufficient stand by generator capacity there are not designed to run more than 4-5 hours at a time and could not support the continuous load shedding we faced. That’s why it effect their production as well as their order submission date .
It hampered their ability to grow business and profitability. 9. Their Other fixed expenses mainly marketing and administration expenses, increased approximately 27% They had to increase yearly salary increment of the employees and recruitment of new stuff. Recruitment and Did festival advertisement is another reason to increase the expenses. They opened 8 of additional stores and inflation during the year 2006.
Another main reason of increasing expenses is number of staff and inflation. Maintaining that increased number of office equipment increased their expenses. 0. Financial expenses have increased approximately 30% in 2006 Most of the banks increased their Interest rates. Private Banks increased the rates on their sanctioned loan by about 2 percentage points and Kanata Bank increased their rates by 1 percentage point on all loans. Financial expenses have increased approximately 30% in 2006.
Because of increasing that interest rate of bank it impact fall in every sector of footwear industry . It had to increase export price and for that they reduce some market.