DHAKA, Bangladesh — It’s a long drive out of Dhaka to Gazipur, a 25-mile trek that with traffic can translate into more than 90 minutes on the road. But Razzak Sattar, owner and managing director of the Utah Group, decided to go the distance more than 15 years back, believing that shared factory buildings would not work in the future.
This story first appeared in the October 7, 2016 issue of WWD. Subscribe Today.
As the number of apparel factories in Bangladesh mushroomed to more than 5,000 by 2013 — developing haphazardly as business expanded — it was clear to Sattar that he’d made a good choice. Business at his factory has grown dramatically, with a capacity of four million pieces of knits and one million woven bottoms a month.
The company had sales of about $75 million this past year out of its 1 million-square-foot facility.
As more stringent safety standards and work rules are being implemented in Bangladesh after the collapse of Rana Plaza in April 2013, where more than 1,100 workers died, model factories have become trendsetters. Many others are being egged on by two global brand and retail groups that have pledged to improve safety: the Bangladesh Accord on Fire and Building Safety and the Alliance for Worker Safety. Those that don’t improve are being forced to scale back or shut down.
Sattar’s passion for detail is apparent as soon as one arrives at his factory, where a product gallery shows off the range — children’s wear, denim, hoodies, woven bottoms, indigo knits, acid-washed shorts and pants, stretch-twill leggings, knit dresses, a tie-dye group and swimwear. Customers include Mango, C&A, J.C. Penney Co. Inc., U.S. Polo Assn., Carter’s OshKosh B’gosh, S. Oliver, Next, Tesco, Zara, Esprit and H&M.
Many of these companies have been returning for more than a decade and their executives describe Utah as one of the “finest factories in Bangladesh, one that stands out in comparison with factories anywhere in the world,” said a European buyer who requested anonymity. “Not just because of the fact that the factory is exceptional in terms of its infrastructure, equipment, management, information technology systems and social compliance, but that he hires consultants, pays them to bring technology into his factory and does not look for short cuts to do business.”
The factory has grown by 35 to 40 percent in the last year in sales and volume. As a model factory, it has had many visitors in recent times, including Karl-Johan Persson, chief executive officer of H&M; Marvin Ellison, chairman and ceo of Penney’s; Canadian high commissioner Benoît-Pierre Laramée; Spanish ambassador Edurado de Laiglesia y del rosal, and European Union ambassador Pierre Mayaudon.
“The biggest change at the factory has taken place in the last seven to eight years,” said Sattar. “Efficiencies in the factory have risen, with industrial engineers able to increase productivity.
“I named the company Utah because all my brothers were studying in Utah. I was the only one who didn’t go,” he added.
Now all four brothers work in the same business and live in the same house. Utah can also be read as an acronym for Ultimate Tailoring Apparel House.
“Earlier buyers used to give manuals in English. I picked the hardest one and made the Utah quality control manual in Bengali, which we shared with all the workers explaining procedures, ethics, etc.,” he explained.
Further, he had 50 managers trained according to international standards of factory management and translate their knowledge into Bengali to share with their colleagues.
“We introduced the ‘zero defect operator’ — in which the best production people won a gold medal and a five-star badge,” he said. “We have what we call the line of the month and they are paid cash incentives. So we used the Japanese way of working to bring in quality control that is self-driven and motivated for excellence.
To improve manager-employee communications, worker committees meet regularly to discuss with management how to further improve things. Sattar also brought in Sujeewa Indika Wanigabaduge as chief operating officer, who had experience running five factories of excellence in Sri Lanka. “Concepts like lean manufacturing, and Six Sigma training, which systematically eliminates waste and improves the quality process, helps us eliminate unnecessary cost and improve efficiency levels,” said Wanigabaduge.
“We have new machines for power saving, some for time saving,” he added. “Others are already working, like a new cutting machine. For new technology, training is a continuous process.”
Most important is on-time delivery, which is 99 percent, and quality inspection, at 98 percent.
“We are always introducing new things. We are adding rotary and digital print, which will go into operation in June 2017,” said Fakar Uddin Ali Ahmed Palash, assistant general manager of production for the group.
Construction on the premises continues. Utah Knitting and Dyeing Ltd. has a new, seven-floor facility and a separate seven-story building for Utah Fashions Ltd. is under construction.
Since the group produces for European and North American brands, there has also been a series of changes following the inspections by the Accord and the Alliance. “At the moment, the sprinkler system is being installed,” said Razzak, “We had fire hydrants, then the Accord and the Alliance wanted different systems, so we are changing them. These factory corrections have cost me half a million dollars for three or four of my factories. The Alliance and the Accord had said that if you do spend so much money on the factory, the buyers will give you better prices, but this has not happened.”
In 2010, Sattar was awarded best overall performance by Bangladesh Prime Minister Sheikh Hasina, and he has been elected the “commercially most important person in the industry” four times in the last decade.
But Sattar is clear that this is not just about one factory. “Looking ahead, I feel that Bangladesh has 30 years more in the garment business and will keep growing economically,” he said. “We have the finest stitching, our workers are very good, so we can expect this growth. BGMEA [the Bangladesh Garment Manufacturers and Exporters Association] is targeting $50 billion by 2021 and our hope is to grow exports 15 to 20 percent each year.
“If we don’t have political instability, no one can stop the country from growing.”