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Bangladesh Fashionology Summit

Finding The Right Technology David Birnbaum Dhaka 12 February 2018


Maximum Gain for Robotic Machinery I The Perfect Machine • A machine Capable of reducing labor by 100% • Cost of the machine: $0

• Maintenance cost: $0 • Machine Lifetime: 1000 years


Maximum Gain for Robotic Machinery II Cost Benefit or not Labor Cost per Unit (Men’s Woven Cotton Shirt) Wage Per Month Wage Per Minute 44 SAM

$200 $0.013 $0.56 Bangladesh vs Mexico CAFTA-DR

FOB Price Duty 19.7% Freight Clearance Costs Cost Disadvantge

$4.71 $0.93 $0.25 $0.12 $1.30 $0.73


Who Benefits? AMORTIZATION (10 years) Annual Machine Total Workers Wage Cost Repayment Interest 5% Annual Replaced Bangladesh $2,400 $250,000 $25,000 $6,250 $31,250 13 Reshoring $25,000 $1,000,000 $100,000 $25,000 $125,000 5

Robotic machinery best suited for mass market commodities: • Proximity to customer • Mass Customization Reshoring


Selecting the right Capital Investment

• Tangible Capital • Machinery • Software

• Intangible Capital • Worker • The factory


Investing in Intangible Capital (Engineering) • Improve the factory layout • Improve worker efficiency – Your worker is you most important capital Investment in your worker delivers the best return The Woven Shirt: Increase Productivity 30% 44 SAM CM $2.20 Labor $0.56 Profit $0.24 Overhead $1.40 Savings Machine vs Labor Machine $0.56

34 SAM $2.20 $0.39 $0.66 $0.98 Labor $0.83


Going Forward Externalities: A factory is not a closed box. Success does just mean making your factory better It also means making your factory more attractive your customer Success in our industry is and has always been based on three rule 1. Know your customer 2. Find out what you customer wants 3. Give it to him


Going Forward Externalities • Product Development • Software • New Skill Sets

• Speed to Market • Factory restructuring • New Skill Sets

• From Commodity to Fashion • Increased number of orders per month • Smaller Quantities


Going Forward: New Markets • Requires same capital investment • Product Development • Speed to Market • New Skill Sets

The need for cultural change Your People are your Greatest Capital assets Invest in your people Value your people

Mr David Birnbaum Birnbaum & Father  
Mr David Birnbaum Birnbaum & Father  
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