Bangladesh Garment Factory Closes After 19 Years Amid Crisis
A small but resilient export-oriented garment factory in Dhaka's Mirpur area has ceased operations after nearly two decades, underscoring the mounting pressures on Bangladesh's apparel sector. Matrix Dresses, located in the Shah Ali neighborhood, officially closed its doors last Thursday, leaving 177 production workers and 13 staff members unemployed. The factory, which generated approximately 20 crore taka in annual revenue last year, was built from the ground up by entrepreneur Mahbubul Hasan Faisal, who started with just ten machines in 2005 and expanded to a hundred without taking a single bank loan.
The closure reflects a perfect storm of structural challenges. A persistent natural gas shortage has slashed production capacity by an estimated forty percent, forcing the factory to rely on expensive alternative energy sources. Simultaneously, international buyers have squeezed purchase prices while the depreciating taka against the dollar has inflated the cost of imported raw materials such as fabric, dyes, and accessories. Labor costs have also risen due to government-mandated wage adjustments, yet buyers have refused to absorb the increase, compressing margins to unsustainable levels.
Faisal, now 42, explored every avenue to keep the business afloat, including attempts to sell the operating concern, but found no takers in a market where investor sentiment toward small-to-mid-sized RMG units has soured. With working capital exhausted and no access to affordable financing, he made the painful decision to wind down operations responsibly. All 190 employees received three months' salary in advance along with full legal benefits, a rare gesture in an industry where abrupt closures often leave workers unpaid.
The Matrix Dresses story is not an isolated incident. Industry analysts warn that dozens of similar-sized factories — too large for micro-enterprise support schemes but too small to weather prolonged shocks — are on the brink. The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) has repeatedly flagged energy security, buyer pricing practices, and access to low-cost capital as existential threats to the sector's backbone. Without coordinated policy intervention addressing gas supply stability, fair pricing mechanisms, and targeted financial relief for compliant mid-tier factories, more closures and job losses appear inevitable, jeopardizing the livelihoods of millions and the country's primary export engine.
Key Highlights
- Matrix Dresses in Dhaka's Mirpur shuts after 19 years, laying off 190 workers
- Owner built business debt-free but succumbed to gas shortage, rising costs, and buyer price pressure
- All employees received three months' salary plus full legal benefits upon closure
- Case highlights systemic risks for mid-sized RMG factories lacking energy security and fair pricing
- BGMEA warns more closures likely without policy action on gas, finance, and buyer practices
Source: প্রথম আলো
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