Report on Micro fibre Group Export Strategy

Submitted to: Mr. Hasan Md. Mahmood UL Haque

Lecturer,
School of Business
Independent University, Bangladesh.

Name ID
Nazrul Islam Rony 1611082
Mohammad Junaid 1610990
Shihab Mahmud 1610997
Mahmudul Hasan 1610989
Al Imran 1610918
Tahmid Hasan Mustakim 1721718

Date of submission: 31th May 2019

 Letter of transmittal

Date: 31th may 2019

Mr. Hasan Md. Mahmood UL Haque

Lecturer,
Independent University , Bangladesh
Bashundhara R/A, Dhaka

Subject: Report submission

Dear Sir,

First of all we would like to thank our honurable faculty Mr. Hasan Md. Mahmood UL Haque for providing us such
an amazing opportunity what enhamce our knowledge on international business. Working on this project we had lot
of fun. We have learnt a lot of new unique issues about international business while preparing this report. We would
be happy if you read the report carefully and we will be trying to answer all the questions that you have about the
report.We have tried our level best to complete this report meaningfully and correctly, as much as possible. We do
believe that our effort will help you to get ahead with this short of venture. In this case it will be meaningful for us.

We express our heartest gratitude , shoud you have any further inquiry concerning any additional information we
would be pleased to clarify that.

Thanking you
Respectfully
 Acknowlegement

We are really greatful to those who have directly and indirectly contributed towards the preparing of this report
espacially the team. We are thankful and feel great pleasure and honour to express our heartiest gratitude and a deep
sanse of obligation to our course instructor Mr. Hasan Md. Mahmood UL Haque for his keen interest, skillful
guidence, enlightened viwes, unfailing patience, mastery advice, inpiring attitude and valuable sugession for the
accompalishment of the present study. In fact, it was not possible to ro bring this work to a fruitful conclution
without our day and night persuasive and sincere effort. We have done research, library work, browsing internet, and
came to understand many events in regard to global cultural knowladge through understanding the core components
of international business and the local and national differences.
 Executive Summary

This report is about Micro Fibre Group. Micro Fibre Group has started its business since two decades. Under one
hand efforts and ceaseless devotion of nationwide well-known textile engineer M. S. Zaman, Managing Director of
the group. From its inception, the group generate to strategic planning feed backed by sophisticated machine, proper
marketing and deployment of professional people in apparel spheres which resulted to access in global apparel
business successfully. The group is well equipped by dyestuffs, chemicals, knitting, dyeing, all over and placement
printing, embroidery, labeling and other allied accessories for garment production with sufficient supporting
facilities.

Developing any market plan requires careful planning and time and is a key step in helping you determine your
readiness to export. A well-prepared plan will help you assess the international market potential for your product or
service, help you quantify your market opportunity, determine how much it will cost to export and will help you in
your application for finance from your bank.

Marketing exists to educate consumers about available products and services. A target market simply defines the
consumers or groups most likely to purchase a particular product or service. Narrowly defined target markets help
marketers craft compelling marketing materials that speak directly to the target buyer.

This report is about Micro fibre group. which export garments ( knit, twill) in Germany and Australia. As Germany
and Austrslis are favorable market in the world. Germany and Austrslis have absorbed the garments idea and created
a big market for this products.
 Company Description

History:
Micro fibre group started their textile business in 1998 by starting construction of the building
for project setup. At 1st they set up Garments project. In 1999 they went to production of fabric
and dyeing with a dryer of 400 kg & 6ton capacity boiler. As an ambition to expand the business
they setup knitting section in 2000 & to fill the demand of knitting they setup as well as stenter,
calendar, dewatering m/c, dryer for finishing. With the passage of time different type of m/c
were brought to the mill to improve the quality & production. The mill is well oriented for knit
composite project. Therefore, when many struggle to survive in post-MFA world; its business in
fact enjoying a healthy growth.

Objective:
Micro Fibre Group aims at leading the knitwear industry not only in Bangladesh but also in the
entire world.

Goals:
Holding itself poised with strategic planning, cutting edge technology, proactive marketing,
skilled human resource and social as well as industrial ethical standards, Micro Fibre Group has
been on a goal of providing world standard knit apparel to the world market.

Management:
An Executive Management Team consists of high-ranking employees that work together to
manage a company or corporation. These individuals oversee the daily operations of a company
to ensure efficiency and product satisfaction. Executive Management is vital to the functioning
of business because the Management Team implements company strategy, sets company goals,
and oversees the general success of the business.  Those on the Executive Management Team
enjoy creative flexibility within the business, and they can voice opinions on company goals. The
monetary compensation for these responsibilities also makes these positions in Executive
Management particularly lucrative.
Micro Fibre Group has an excellent management team. M.S Zaman is the managing director, S.R
Ahmed Azad and Amirul Haque are executive directors. Dr. M K Zaman is the finance director
and Md. Mukhlesur Rahman Khan is the director of marketing department. Micro Fibre Group
also has Lt. Col Hasan Mahmud as the director of Admin, HR and compliance. Shipping and
forwarding department deals with the export and import activities.

Export Team:

Export Account
Managers

Sales Support
Team

Customer
Service Team

International
Sales Director

Product Service Description

Export Opportunity:
Bangladesh is the 2nd largest Ready Made Garments (RMG) exporter in the world after China.
About 81% of its export earnings are coming from RMG. Textile and Apparel sector’s
contribution to Bangladesh GDP is around 20%. About 20 million people are directly associated
with the industry. It is clear that main driving force of country’s economy is this industry. Now
Bangladesh is dreaming to have middle income country status by 2021, RMG will certainly play
a crucial role in materializing the dream
Bangladesh could maintain a significant growth in apparel export to the world through last many
years. A study from BGMEA shows that the growth was highest among competing countries for
eight years from 2008 to 2015. While global industry growth was about 50%, Bangladesh could
secure a growth close to 120% through the period. As per the figure 1, only Vietnam is close to
Bangladesh in this aspect.

M arke t Share of major RM G exporte rs in the word (%)

37.16
34.61
32.36 32.12
29.54

6.9 7.48
5.64 5.99 6.09 5.42 5.47
4.59 3.9
3.323.844.12 3.284.273.95 3.37 3.49 3.72 3.43 3.84

2012 2013 2014 2015 2016

China Bangladesh India Viet Nam Turjkey

Figure 1: Year on Year export growth percentage of major clothing supplying countries

As per as apparel export growth is concerned 2016-17 financial year was not good for
Bangladesh otherwise the country was maintaining a tremendous growth for last 10 years. The
country was maintaining a CAGR apparel growth of 12.43% through this period. In financial
year 2015-16 apparel export growth reached to 28.09 billion USD from 10.7 billion USD in FY
2007-8. In the year 2016-17 apparel export was 28.15 billion USD which is only 0.2% higher
than the previous year. From figure 1 Bangladesh can identify its major competitors in apparel
export who are Vietnam, Cambodia and India.
Based on the positive trends and core competences of Bangladesh, the government has set an
ambitious target for the textile and apparel industry. BGMEA and government look for USD 50
billion apparel export by the year 2021. If that has to open the country has to go through a major
transformation as shown in figure 2. And this transformation is going to open up enormous
market and business opportunities for countries like China and India. These countries will be
able to supply huge amount of raw and processed materials.

Figure 2: Achieving 50 billion USD export target will require a big transformation hence will come up with
major business opportunities in the value chain
Bangladesh has opportunities of expanding the market through the following
strategies. 

i) Cost Effective Strategy 

ii) New Product Development and Diversification Strategy 
iii) Market Diversification Strategy

Growth Potential:
Bangladesh’s readymade garment industry, along with five other sectors, has been identified as
the highest potential growth sector for the coming decades, according to a new survey.
Light Castle Partners, a Bangladesh-based think tank, unveiled the findings of the survey of 102
top executives across 12 leading Bangladeshi industries in two major cities, Dhaka and
Chittagong, at a program held at capital Dhaka’s Lakeshore Hotel on February 2, 2018.
The confidence index aims to appraise the business point of view of private sector players
representing a variety of industries across the economy.
The survey showed that business confidence went up from “low-to-moderate confidence of +39”
in 2016 to “a cautiously optimistic confidence level of +43” in 2017. The index is determined on
a scale of -100 to +100.
However, several serious concerns including the classified loans condition, bureaucratic red
tapes for doing business, recent slump in readymade garment items prices, transportation and
logistical hassles and infrastructure bottlenecks such as port congestions are decelerating the
natural growth rate of the business.
Moreover, power outages have increased production costs and final prices as businesses
including the apparel manufacturing have to heavily depend entirely on their personal backup
generators. The business leaders feel a raft of actions can help improve the current scenario along
with investor confidence.
Apparel Resources that Bangladesh needs to shift export reliance on the garment sector,
facilitating the ease of starting and doing business, and improving infrastructure and logistics.
Production Strategy:

Production Planning & Process Control

Concept of bale management
Bale management is a process of inventory control and selection of bales of fibers according to
their properties and also to mix their fibers homogenously to get consistent production as well as
quality of yarn. For bale management, all bale samples are tested and bale with almost similar
category are arranged for homogeneous mixing.
In Micro Fibre Group bale management is bone by bale information advance system (BIAS)
 Bale category i.e. Mic, color grade, staple length
 Bale identification i.e. bale no.
Bale management Procedure:
1) At first 100% bales of a lot are tested. Normally micron ire value and color grade are
taken as parameter to be tested.
SL no. Bale no. Mic. Color grade
1 1 4.0 GM
2 2 4.2 SM
3 3 4.1 GSM
1200 1200 4.0 SM

2) After that closely similar MI. (+- 0.3) and color grades bales are selected.
 Mic Color grade Total
GM SM (S) SM
3.9 75 25 4 100
4.0 90 8 2 104
4.9 100 20 3 135

3) Then the mi. which have the major proportion in the lot are taken
4) Finally a number of bales are selected according to the capacity of the industry
Let,
Total no. of bale: 800
Dailey consumption: 40 bales
No. of days to process the lot: 800/40=20
Information found on a bale
 Gin no.
 Lot no.
 Bale weight
 Suppliers bale no.
Binding materials for bales:
 Steel wire, copper wire
 Polyester strap
 No. of binders 6 to 8
Manpower available in mixing section
 Mixing man: 6
 Cleaning man: 2
 APO: 1

Process Flow Chat

 Ring Spinning (Combed Yarn)

Input Output

Blow Room
Raw Cotton Raw Cotton &
Function: opening, cleaning& mixing
Card Matt

Chute Matt Carding Card Silver

Function: 1) reduction of nap’s
2) to make fiber individual

Card Silver Breaker Draw Frame Breaker Drawn

Silver
Function: 1) increase fiber homogeneity

2) Make the fiber parallel

Breaker Drawn Lap former Lap

Silver Function: Make Jap for comber

Lap Comber Combed silver

Function: Extract short fiber for better
quality

Combed Silver Finisher Draw frame Finisher Drawn

Silver
Function: 1) increase fiber homogeneity

2) Increase the fiber parallelization

Finisher Drawn Yarn

Simplex
Silver
Function: Make Roving
Roving Ring Frame Yarn Package

Function: Make yarn from roving

Autoconer
Roving
Function: 1) Produce good yarn
package.
2) Remove remaining Yarn faults

Heat Setting Conditioned

Yarn
Function: Twist setting by steaming

Final Inspection & packing

Delivery

Process Flow Chat

 Ring Spinning (Card Yarn)

Input Output

Blow Room Raw Cotton &

Raw Cotton
Function: opening, cleaning& mixing Card Matt

Carding
Chute Matt Card Silver
Function: 1) reduction of nap’s
2) to make fiber individual

Card Silver Breaker Draw Frame Breaker Drawn

silver
Function: 1) increase fiber homogeneity

2) Make the fiber parallel

Breaker Drawn Finisher Draw frame Finisher Draw

Silver frame
Function: 1) increase fiber homogeneity

2) Increase the fiber parallelization

Finisher Drawn Ring Frame

Silver Roving
Function: Make yarn from roving

Roving Yarn
Simplex

Function: Make Roving

Autoconer

Function: 1) Produce good yarn

package.
2) Remove remaining Yarn faults
 Yarn Package

Heat Setting Conditioned

Yarn
Function: Twist setting by steaming

Final Inspection & packing

Delivery

Process Flow Chat

 Rotor Spinning

Input Output

Raw Cotton Blow Room Raw Cotton &

Function: opening, cleaning& mixing Card Matt

Chute Matt Carding Card Silver

Function: 1) reduction of nap’s
2) to make fiber individual

Card Silver Breaker Draw Frame Breaker Drawn

silver
Function: 1) increase fiber homogeneity

2) Make the fiber parallel

Breaker Drawn Rotor frame

Yarn Package
Silver
Function: Make yarn from silver by
drafting & twisting

Final Inspection & packing

Delivery

Foreign Market Place Analysis

Rational Of Targeted Foreign Market
In International business, a company need to evaluate available international segments for their
potential and action-ability to choose most viable market segments for targeting foreign market.
Microfiber group processed of adjusting a marketing strategy to adapt to conditions in other
countries and focus on the needs and desires of the customers by tracking the foreign customers
through market research and cultural surveys marketers can discover the best methods of
reaching them. At the moment, the company making Business connection in Europe (Mostly in
Germany) and Australia.

Country Profile
Germany Country Profile

Germany has now emerged as Bangladesh’s one of the largest export market destination in Asia
and apparel exports to the country is rising gradually. Having a population of 82.4 million, US $
48,500 per capita GDP. Germany is the world’s third largest apparel importer 6.5% (% of Global
Imports) and the fourth largest apparel market in the world after USA and China. Germany
presents some of the most exciting fashion and apparel opportunities globally for the highly
enthusiastic and sophisticated consumers. Fashion capital Tokyo is a key trendsetter and an
excellent test market for further expansion in Asia.

Culture:
German designers were leaders of modern product design, with the Bauhaus designers like Mies
van der Rohe, and Dieter Rams of Braun being essential.
Germany is a leading country in the fashion industry. The German textile industry consisted of
about 1,300 companies with more than 130,000 employees in 2010, which generated a revenue
of 28 billion Euro. Almost 44 percent of the products are exported. The textile branch thus is the
second largest producer of consumer goods after food production in the country.[37] Berlin is the
center of young and creative fashion in Germany, prominently displayed at Berlin Fashion Week
(twice a year). It also hosts Europe's largest fashion trade fair called Bread & Butter.

Australia Country Profile

Australia has 24.6 million population with $53,799.94 USD. In Australia, beginning of the 2018
clothing market amounted US $ 87.32 billion and expected annual growth of 1.9%. Main market
share of women’s and girl’s apparel is calculated US $ 35.83 billion, which is showing the future
business opportunity for big growth.

Competitors Analysis
Bangladesh is the world's second-largest apparel exporter of western (fast) fashion brands.As we
know Microfiber is currently a fast growing garment in Bangladesh. In the country there are few
more respectable Companies are doing well in the garment sector as well. These are
1. Beximco
2. Square Textile
3. Noman Group

Market Entry Strategies

Direct and indirect exporting: Microfiber group is one of the leading exporter in RMG sector.
Our organization involved in direct exporting. There is nobody else in the export chain taking a share
of owner’s margin. So they involved in direct exporting.

Direct exporting: Direct exporting involves selling directly your target customer in the
market. Selling directly to customer means there is nobody else in the export chain taking a share
of owner’s margin.
Because we will get many advantages from direct marketing. For example,
 We can control our product price and brand.
 We can get a direct understanding of buyers’ and end users’ needs, which allows them to
customize and improve offerings. We able to know, what they like and what they dislike.
 We can maintain all customer relationships.
 It will be easier for us to identify possible new opportunities.
 Some customers may prefer dealing direct with us, rather than through an intermediary.
E-commerce:
E-commerce facilitates the very process of international transaction; this involves securing and
finalizing a contract, delivery of the product, and finally payment for performance of the
contract. The movement of goods and services, as well as the payment mechanisms within a
country and more so outside a country, are governed by regulatory and legal issues. Hence, the
regulatory environment is at the core of e-commerce development.
 Tax
 Payments gateway
 Trademark, patents, and copyright
 Shipping restrictions
 Inventory
 Age restrictions
 Business insurance
 Licenses and permits
 PCL compliance
 What you did not know you needed to know.

Target customer profile:

A target customer profile identifies the customer more likely to buy our product or service. The
target customer profile identifies shared characteristics, behaviors and attitudes the target
customers have, and this knowledge is used when creating captivating marketing materials and
promotions. Having a solid and suitable customer profile may increase our company’s profits
because people in need are buying the products or services.
Step-1: Group companies’ revenue: In the first step the goal is to separate your customers in
three revenue streams: large/ medium/ small. This separation is used by many B2B companies
because it clarifies the revenue streams.
Step-2: Identify your most important revenues stream: Once we have grouped our customers
into three separate groups: small/ medium/ large then we need to identify which one is our
biggest revenue stream. Picking revenue as the main criteria to identify your biggest revenue
stream is based upon the assumption that revenue is the clearest sign to see if someone is
satisfied with your product/service.
Step-3: Within your most important revenue stream identify your best customers: Now we have
a quite fair understanding of which group of clients is the most important for us, which group of
clients being you the most value. That is a clear indication of where we will find your target
customer profile.
Step-4: Analyze your best customers and identify your target company profile: In B2B sales we
will often identify companies as potential customers before knowing with which employee we
will deal. That’s why our first job is to identify our target company profile. If we are working in
B2C or dealing only with self-employed customers we will skip this part and go directly to step-
5.
Step-5: Analyze the actual buyers within your best customers: If we work in B2B especially
with medium and large companies, we know that having a clear view of which company we need
to target is only half of the work because we still need to know who will be the actual buyer. The
actual buyer is the person who will take the decision to buy our product and not necessarily be
the one that signs the agreements.
Step-6: Create your target customer profile: In this final section we will be able to wrap it up and
create our final target customer profile by merging our target company profile, target buyer
profile, and remove irrelevant data.
Pricing strategies:
The main aim of the management of every organization is to maximize profits by effectively
getting the products of the shelf. Pricing strategy is a way of finding a competitive price of a
product or a service. This strategy is combined with the other marketing pricing strategies that
are the 4P strategy (products, price, place and promotion) economic patterns, competition,
market demand and finally product characteristic. As we know today world highly price sensitive
and in Bangladesh the competitions is very high between the organizations therefore price play a
very vital role for the company growth.

Sales and promotion strategies:

Promotions can be directed at once the customers, sales staff, or distributions channel members
(such as Agents). It includes discounts, premiums, prize, and product samples such as 20% off.

Logistics and transportation:

 Logistics: Logistics is the process of planning and executing the efficient transportation and
storage of goods from the point of origin to the point of consumption. The goal of logistics is
to meet customer requirements in a timely, cost-effective manner.

Transportation:
Exporting our products to Germany and Australia is an exciting way to grow our business and to take
advantages of the internet’s global audiences. But it raises a number of challenges. Among the most
obvious is transporting our products after we sell them. Before we make our first shipment, we will need
to enlist the help of a freight forwarder an expert who understands import/export rules, shipping
regulations in foreign countries, and the best methods of shipping to those markets. A freighter forwarder
can:
 Arrange transportation of your goods and from foreign destinations.
 Find the best shipping rates
 Prepare and examine necessary documents
 Advise us on freight cost, port charges, consular fees, and any additional costs of shipping
such as insurance, special documentation, and handling fees.
Plans or ships:
After we have chosen a freight forwarder, we will have to decide how we will transport our
products by land, sea or air. The methods depend on the type of product you are shipping and the
extent to which time is a factor. In our case sea transportation is the most economical shipping
method. But sometimes we use airplanes for emergency orders.

International Law

Dispute Resolution:
It is the process of resolving disputes between parties. The term dispute resolution may also be
used interchangeably with conflict resolution, where conflict styles can be used for different
scenarios. Alternative Dispute Resolution is not a strange practice for Australia and Germany
people.

Language Considerations:
The official language of Germany is Standard German with over 95 percent of the country
speaking Standard German or German dialects as their first language. They also used as one of
the four official languages of Switzerland (along with French, Italian, and Romansh).

Though Australia has no official language, English is regarded as the national language of

Australia and is spoken by all.

Contract Terms and conditions:

Business terms and conditions set the contract foundation between you and your customer. It
doesn’t matter if your business provides products or services, a terms-and-conditions document
is essential. It protects your business, defines your procedures, limits your liability and explains
what you have agreed to do. Special provisions may be appropriate to include in your terms and
conditions depending on your business, but in many instances simply including a few basic
sections creates an effective, but simple document that is easy for the customer to understand and
meets your business needs.
Product Liability considerations:
It refers to manufacturer or seller being held liable for placing a defective product into the hands
of a consumer.

Intellectual property protection:

Patents:
The application for registration of a patent in Germany will be submitted with the German Patent
and Trademark Office (DPMA). It will take around three years for a patent to be examined and
registered. Patents are protected for 20 years in Germany and they can be transferred.
An Australian patent provides a legal right to stop third parties from manufacturing, using or
selling an invention in Australia. It may also be used to license someone else to manufacture an
invention on agreed terms. Australian patents are administered by the Patent Office of IP
Australia. It lasts for up to 20 years from the filing date of application.
Trade mark protection:
According to the Trademark Act, German trademarks are protected against wrongful use of the
same or similar signs or marks by third parties. Trademarks are registered with the Patent and
Trademark Office in Germany and with the Office for Harmonization of the International Market
(OHIM) at European level. Trademark protection is provided for an indefinite amount of time if
the owner pays a renewal fee after the first five years and then after every ten years.
Australia has a well-developed legal system that protects the intellectual property of businesses
and individuals. Businesses can register a trade mark as a marketing tool. A registered trade
mark provides legal protection that prevents others from using your brand. Trademarks are
issued and protected nationally.
Copyright:
Under the German Copyright Act only natural persons have the right to protection for
their intellectual work. Protection of intellectual property in Germany is enabled immediately, no
registration being needed in order for the creation to be acknowledged. Copyright protection is
available during the author’s life and 70 years after his or her death.
Australian copyright law is designed to encourage and protect those businesses which invest
their time and talent in the creation of new material. Australia is also a signatory to a number of
international conventions that deal with copyright. Material is automatically protected by
copyright in Australia under the legislative framework. No specific registration is required. There
are some exemptions from what is covered and around the use of copyrighted material.

Sales agent:
Agent: A sales agent dose not buys goods upfront like a distributor. Instead, the manufacturer
gives the agent the power to act them, and entire into sales contracts on their behalf with third
party purchase order, which has been facilitated by agent. The sales agent does not stock
inventory and is usually compensated by the principal in a fee for service arrangement.
Distributor: A distributor is usually given the right to sell goods within a designated area under
certain terms and conditions. The distributor easily buys the goods upfront at wholesale prices
from the manufacturer, adds a margin, and then on sells those goods within their defined
territory.
Choosing an Agent or Distributor:
Germany and Australia companies may appoint a Bangladeshi firm or individual as an exclusive
or non-exclusive agent or distributor. The local agent should be reputable, imaginative, active
politically astute and technically competent. A local agent authorize to service industrial
consumers to bid on government tenders and to place orders or book indent orders.

Export / import regulations:

Restrictions: The RMG industry is highly dependent on imported raw materials and accessories
because Bangladesh does not have enough capacity to produce export quality fabrics and
accessories. About 90% of woven fabrics and 60% of knit fabrics are imported to make garments
for export. We still have the shortage of raw materials. By this way we can produce raw
materials by using our own manpower with low cost and can export more the RMG to the other
countries for earning more foreign currencies. A number of RMG factories in different part of
the country will enlighten the whole country. Bangladesh already established itself as one of the
lending garments supplier to the whole market. While most low income countries depend largely
on the export of primary commodities, Bangladesh has made the transition from being primarily
a jute exporting country to garment-exporting one. This transition has been dictated by country’s
resource endowment, characterized by extreme land scarcity and a very high population density,
making economic growth depend on the export of labor intensive manufactures.
Export Taxes:
The National Board of Revenue (NRB) issued Statutory Regulatory Order (SRO), which stated
that corporate tax would be 12% for the garment manufacturers. According to the new Statutory
Regulatory Order (SRO), 0.6% tax at source on all exports except jute products will be effective
from July 1, 2018, to June 30, 2019.
Export Clarence:
Exporters are exempted from import duties, VAT, and tax on luxury products for materials and
intermediate products used in manufacturing goods destined for abroad.
 Mirco Fibre Group
STATEMENT OF FINANCIAL POSITION
As at 31st December,2016

Note
s As at As at
31.12.2016 31.12.2015

ASSETS:
Non-Current Assets: 1,181,180,040 782,494,963
Property, Plant and Equipment 04 870,486,005 515,907,382
Investment in Marketable Securities (AFS) 05 310,694,035 266,587,581

Current Assets : 434,659,631 412,684,597

Inventories 06 180,779,638 150,047,338
Accounts Receivables 07 7,735,798 4,783,652
Advances, Deposits & Prepayments 08 82,545,351 99,815,239
Cash & Cash Equivalents 09 163,598,844 158,038,368

TOTAL ASSETS 1,615,839,671 1,195,179,560

SHAREHOLDERS' EQUITY AND LIABILITIES:

Shareholders' Equity: 832,945,668 679,344,704
Share Capital 10 224,532,000 213,840,000
Tax Holiday Reserve 11 4,392,110 4,392,110
Net Gain on Marketable Securities (AFS) 05(a) 245,913,549 206,217,741
Retained Earnings 12 358,108,009 254,894,853
LIABILITIES
Non-Current Liabilities: 248,172,487 114,886,251
Long Term Finance-Net off current maturity 13 172,712,958 33,116,966
Retirement Benefit Obligations 14 31,705,572 50,927,728
Deferred Tax Liability 15 43,753,957 30,841,557
Current Liabilities: 534,721,516 400,948,605
Short Term Finance 16 208,091,012 135,592,500
Long Term Finance- current maturity 17 33,686,157 10,713,865
Accounts and Other Payable 18 267,279,760 211,335,796
Income Tax Liability 19 25,664,587 43,306,444

TOTAL SHAREHOLDERS' EQUITY AND

LIABILITIES 1,615,839,671 1,195,179,560

Net Assets Value (NAV) Per Share 37.10 31.77

 Mirco Fibre Group
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
For the year ended 31st December, 2016

For the year ended 31st December, 2016

Notes
2016 2015

REVENUE 20 3,162,625,108 2,678,909,367

(1,896,784,00 (1,609,797,641
Cost of goods sold 21 5) )
1,265,841,10 1,069,111,72
GROSS PROFIT 3 6
(1,034,532,06
OPERATING EXPENSES 7) (896,400,801)
Administrative expenses 23 (71,944,298) (59,781,918)
(962,587,769 (836,618,883
Selling & Distribution expenses 24 ) )

OPERATING PROFIT 231,309,036 172,710,925

Financial charges (7,240,625) (5,498,154)
224,068,41 167,212,77
1 1
Other income 25 19,018,941 11,218,981
243,087,35 178,431,75
2 2
Workers' P.P. fund & welfare fund 26 (11,575,588) (8,496,750)

PROFIT BEFORE TAX 231,511,764 169,935,002

Income tax expenses:

Current tax 27 (44,952,853) (39,971,374)
Deferred tax 15 (8,501,755) (2,685,208)

(53,454,608) (42,656,582)
NET PROFIT AFTER TAX 178,057,156 127,278,420

Other Comprehensive Income:

Change in fair value of Marketable Securities 5(b) 44,106,454 (81,026,115)

Deferred tax (4,410,645) 8,102,612

Total other comprehensive income for the year, net of
tax 39,695,809 (72,923,503)
Total comprehensive income for the year 217,752,965 54,354,917

Earnings Per Share (EPS) (Adjusted EPS of 2014) 28 7.93 5.67

Number of Shares used to Compute EPS 22,453,200 22,453,200

Mirco Fibre Group

 STATEMENT OF CASH FLOW
For the year ended 31st December, 2016

Amount in taka

2016 2015

Cash Flow from Operating Activities: 2,677,510,048

Collection from revenue & others 3,160,000,467
Payment for cost, expenses & others (2,460,915,902)
Miscellaneous income (2,893,478,524)
Cash generated from operations 645,106
334,090
Income tax paid
217,239,252
Financial charges 266,856,033
Net cash flows from operating activities

Cash Flow From Investing Activities: (38,049,544)

Purchase of property, plant and equipment (44,023,643)
Proceeds from sales of motor vehicles (5,498,154)
(7,240,625)
Investment
Dividend income 173,691,554
215,591,765
Profit from bank deposits & investment
Net cash used in investing activities

(405,595,127) (167,600,458)
Cash Flow from Financing Activities:
Payment of dividend 509,000
Long term finance received/ (paid) from bank (net) 2,378,400
Short term finance received/(paid) from bank (net) (12,564,809)
0.00
Net cash flow from financing activities
17,034,149 7,659,649
Increase/ (decrease) in cash and cash equivalents
931,693 3,656,794
Cash and cash equivalents at the opening
Cash and cash equivalents at the closing (168,339,824)
(385,250,885)
NOCFPS

Amount in Taka
 Risk Management

Country Risk and Political Risk:

The culture of a country may create risks that may make it difficult for companies to operate
safely, effectively, and efficiently. Some of the country risks come from the government’s
policies, economic conditions, security factors, and political conditions.
It is important for a company to follow the political and economic situation. In order words, it
has to monitor the country risk. There are many different situations that can involve country
risks. A country's political situation may affect the import and export.
The ready-made garments industry gets deep trouble due to some political issue. Sometimes
local political problems directly related to financing dealing with the owners.

Commercial Risk:
Commercial risk refers to the risk of increased competition from foreign and domestic sources
leading to lower prices, revenues, profit margin, and market share which could have an adverse
impact on the business, financial condition.
One of the major commercial risks is lack of knowledge about the international market. If an
exporter who does not have proper knowledge about the area of sales where he markets his
product, no doubt, he may fail in international business. So, an exporter should have studied
totally about the foreign market about selling of his export product.
We have discussed two commercial risks involved in export import business under international
trade. Both commercial risks are common in any business. But the impacts of such commercial
risks are more in international business.
Now I am going to explain about another commercial risks involved in international business. As
you are aware, international business is taken place from one country to another country where
the distance between exporter’s place and importer’s place is too far. So, meeting requirements
of your overseas buyer is a crucial one.
Due to longer transit time, if shipped by sea or delay in transit to inland destinations may lead to
reject the export goods as your overseas buyer may not be able to use goods based on his
commitments to customer.

Currency Risk:

Currency risk refers to the variation of currency produced economic losses. Exchange
depreciation might stimulate export however, the appreciation of exchange rates reduces the
international competitiveness of products. There are five factors that influence the exchange rate
movement which are domestic inflation rates, international balance of payment, financial
revenue and expenditure, changes in exchange rate policy and the intervention from government
and interest rate.
The value of currencies and exchange rates (value of a currency for conversion purposes)
frequently fluctuate, which makes international deals complicated. Variations in the exchange
rate can affect the payments that trading partners owe each other, and large swings in currencies
can affect the actual values of companies. One country could be suffering from inflation while
the trading partner's country is not. This can make returns on investment uncertain, and
businesses typically don't like uncertainty.
If local currency is damaged against foreign currency, companies can make more revenue against
sale in local currency and vice-versa. On the other hand, if local currency is appreciated against
foreign currency companies can generate more profit as import expense is decreased.

Market Risk:
Market risk is the risk that the value of an investment will decrease due to changes in market
factors. Market risk is the possibility of an investor experiencing losses due to factors that affect
the overall performance of the financial markets in which he or she is involved. Market risk, also
called "systematic risk" cannot be eliminated through diversification, though it can be hedged
against.
Market risk and specific risk make up the two major categories of investment risk. The most
common types of market risks include interest rate risk, equity risk, currency risk and commodity
risk.
 Raw material availability and movement of rates
 Demand and Supply Risks
 Quantities, Qualities, Suppliers and lead time
 Competition
 Increase in commercial costs

External Assistance

Customs Border Protection:

This combination of high duty rates and a complex set of laws and regulations market textile
imports susceptible to trade fraud. CBP conducts capacity-building exercises, such as internal
and external outreach efforts to build knowledge on how to spot trade fraud. CBP’s audit results
are an example of these efforts, which recovered approximately $1.4 million in FY 2012 due to
audits of companies importing textiles and wearing apparel.
CBP works with our foreign government counterparts to address textile related fraud. This
includes work with ICE/HSI to form Textile Production Verification Teams (TPVTs) to conduct
factory visits abroad to verify origin and compliance with trade preference programs claimed on
imports of textiles and apparel.
Export in Germany:
Germany is the largest trading partner of Bangladesh in Europe and the second largest globally.
Bangladesh currently holds the 37th place in the ranking of Germany’s trading partner and its
significance has been increasing over a number of years. We exporting our fabrics to some
Germany company. Our maximum shipment goes to Germany. The group generate to strategic
planning feed backed by sophisticated machine, proper marketing and deployment of
professional people in apparel spheres which resulted to access in global apparel business
successfully.
U.S Commerce Department:
The United States commercial service is the trade promotion arm of the International Trade
Administration within the United States Department of Commerce. The mission of the USCS is
to promote the export of goods and services from the United States, particularly by small- and
medium-sized businesses; to represent U.S. business interests internationally; and to help U.S.
businesses find qualified international partners.
Online and customized market research. Support for U.S. exhibitors in selected overseas and
domestic trade shows to attract qualified business partners. Fee-based programs to introduce
exporters of U.S. products to qualified buyers and distributors. Individualized counseling and
advocacy. Training programs on subjects such as export documentation, export controls, and the
basics of exporting.

www.export.gov
Export.gov brings together resources from across the U.S. Government to assist American
businesses in planning international sales strategies and succeeding in today's global
marketplace. Export.gov was also created to provide better customer service for businesses
interacting with the Federal Government.
The U.S. Department of Commerce International Trade Administration manages Export.gov as a
collaborative effort with the 19 Federal Agencies that offer export assistance programs and
services.
U.S Export-import Bank:
The U.S. Export-Import Bank (Ex-Im Bank) is the principal government agency responsible for
aiding the export of American goods and services, and thereby creating and sustaining U.S. jobs,
through a variety of loan, guarantee, and insurance programs. Generally, its programs are
available to any American export firm regardless of size.
The Ex-Im Bank focuses much of its energy and resources to providing support to U.S. small
businesses for export of U.S. made products. There are no transactions, in terms of dollars, that
are too small for the Ex-Im Bank to consider. Programs aimed at this sector include Export
Credit Insurance, and Working Capital Guarantee programs.
International Trade Administration:
Bangladesh, being a labor-abundant country, started the process of industrialization by
concentrating on labor-intensive products such as textiles and clothing. Since clothing is more
labour intensive than textiles, it is logical for Bangladesh to demonstrate its comparative
advantage in clothing. Over the last decade or so Bangladesh has substantially liberalized its
trade regime, moving away from costly protectionist policy toward a more export-friendly trade
regime.
This paper analyzes textiles and clothing exports from Bangladesh in the context of globalization
of the world economy and liberalization of world trade. The main objectives of the paper are:
 To present an overview of international trade in textiles and clothing.
 To examine the impact of the Uruguay Round period on the textiles and clothing industry in
different regions based on an applied general equilibrium model, the Global Trade Analysis
Project (GTAP) model.
 To examine the competitive positions of Bangladesh and selected developing countries
which are competitors of Bangladesh in textiles and clothing.
 To explore the rationale for selection of optimal trade and industry policy instruments for the
textile and clothing industry in the short-run and long-run
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