Asif Moyeen is the CEO and Managing Director of Far East Knitting & Dyeing Industries. He finished his graduation with a major in Accounting and Business Management from the De Anza College in California in the year 1975. The notable personality then came back to the country to join Bank of Credit and Commerce International (BCCI). After his 7 years of tenure in BCCI, Asif went to Hong Kong to join as the head of the bank in Macau from where he was sent to look after the South China Operation. After years of successful banking, the diligent personality took his leap into being an entrepreneur and returned to Bangladesh in the year 1994 to take the lead as the CEO of his company in the textile industry.
“I had a strong team of colleagues who were all bankers and relied upon figures for everything. As per our learnings, we knew every paper had to be prepared so that we had an idea what we were doing rather than just jumping into the field.”
You have previously worked as a banker in the Bank of Credit and Commerce International (BCCI). However, now you are the CEO and Managing Director of Far East Knitting & Dyeing Industries. How did you make this shift?
I started my banking career in Bangladesh with BCCI in the year 1976 and then went off to Hong Kong to take the lead as the Head of the bank in Macau. I was assigned to look after the South China operations from there in 1982 and then transferred back to Hong Kong again 7 years later. For people who know Hong Kong, they will understand how dynamic that place is. Back then, it was probably the most progressive city in Asia, and China, which is now a very modern country, had just started to open up. That was precisely when I decided that I would take the plunge of leaving my high-paid job in a foreign country and go for something of my own. I resigned from the bank and started my own business in Hong Kong, which defines the first step to this transition. The business comprised of trading steel from India into China. The country experiences a big construction boom during that time, and I had a good liaison with the Tata Steel. I started importing steel to China. Alongside, I went into property buying and selling. I entered the market at a thousand dollars per square feet and exited in 1994 when the price soared up to $5,000. In between, I traded about 20 properties at 10% equity margin and made a tremendous amount of capital during that time. I decided to take another significant risk, by leaving the luxurious lifestyle there, and moving to Bangladesh. So, in that short span of 6 years, I changed my life twice. Once from a banker to a businessman in Hong Kong and then again from a businessman in Hong Kong to a manufacturer in Bangladesh into a sector where I have never worked before.
Initially, I did not know anything about textile and I had never worked as a businessperson in Bangladesh before. However, coming from a banking background, it was all about numbers for me, and I did a lot of research into the business before I decided to invest. Moreover, as a banker and as a businessperson in Hong Kong I observed many different surroundings in the most successful cities around the world. I looked up to the top manufacturers and factory owners and desired to become one. The best possible way I could do that was by returning to my own country. I wanted to come back home, set up an enterprise, employ people, and create something. It was never the money that drove me back to Bangladesh.
If you look back at your years as a banker and then as an entrepreneur, tell us about the fundamental learnings that have helped you come this far?
If you look back at the situation in 1994, the textile industry in Bangladesh was still in its early days. Before Bangladesh, the industries were mostly located in China, Malaysia and Vietnam, and a portion of it in Korea. I did my research on the existing markets. These markets were familiar territories for me as I had previously worked there before returning to Bangladesh. Therefore, I went to visit the companies and learned what the businesses in Hong Kong were doing. Such businesses had not come to Bangladesh then, and I thought of replicating something similar to that here; this is how the factory was set up.
At that time, people who were in the business were not seasoned businessmen, and this gave me an edge in the market. The industry was just growing, and most of the existing players in the country were people who rather had some association with manufacturing and textile production and got into the business without prior research. However, when I came in, I had a strong team of colleagues who were all bankers and relied upon figures for everything. As per our learnings, we knew every paper had to be prepared so that we had an idea of what we were doing rather than just jumping into the field.
Secondly, as bankers, we were well aware and very respectful of compliance. My team knew how tasks have to be done, how things worked in an organization and how the financial structure had to be. This knowledge was mostly unknown in the garment industry previously, as professionals did not run the businesses then. In 1994, compliance was not as big of an issue as it is today so, we had a significant edge from the very beginning. Whenever somebody walked in, they could feel that there was a sense of financial discipline, commercial, and manufacturing structure, which was just beyond making a t-shirt.
Your company is the first to introduce 100% compact spinning in Bangladesh. Tell us about the investment benefits of introducing something as such.
My decision to go for spinning was a reasonably calculated one. Every piece of garment that is produced here, roughly 35% of that comprises of yarn. We had to give away all of that to import the yarn and start the production. Although the main reason behind the spinning mills was to capture that percentage, our goals weren’t just limited to this. With a considerable investment of $20 million plus in a plant, I wanted to bring something which would be different to what already exists and add some value that would help positively differentiate us in the long run. That is how the compact spinning came into being.
In Bangladesh, nobody pays much to buy premium yarn. The market is insufficient and small. However, as I have my consumption, I decided to use a premium product to enhance my final export product. This is now a much safer zone for us as we are using the base material better than any other spinning mill in Bangladesh.
As part of the other benefits, some saving also takes place in the process loss. When you dye fabric, a lot of process loss takes place. Although, in the case of compact yarn process loss is less. Maybe one can save about 1% to 1.5% per kg. However, when you save 1% on 18,000 kilograms every day over the years, it adds up to a lot of money. In the short term this a significant investment but in the long term, the benefits are much greater.
What opportunities are you drawing in for the country by producing something that was previously imported?
Around 400,000 kilograms of yarn which was previously imported, either from India or Indonesia every month, is now being produced in Habiganj. An area, which was previously affected by poverty and surrounded only by tea plantations, now has a state of the art spinning mill, creating employment for the locals. Many shops have opened in the surroundings, and the transport sector has improved followed by this. I feel very proud of the fact that I took it to a zone where there was nothing. This initiative has contributed vastly to the country’s development as we have added value, created employment, and made the industry stronger by producing the base raw material at home.
“All our workers, production managers, supervisors and line managers do not measure efficiency by the number of pieces they make rather calculate the standard minute value they are adding.”
What measures are you taking to improve the manufacturing process and the efficiency of labor in your companies?
As the world is changing, technology, machinery, and equipment are also developing. The green requirements have increased compelling more companies to produce environmentally friendly products and continuously update their processes. When we set up this team, it required us to use 100 liters of water to produce 1 kilograms of fabric. Nevertheless, today we only use 46 liters in the Far East. This tremendous drop took place because we were the first in the market to buy the latest and most environmentally friendly equipment and machinery. Technically, this reduces your cost, as using less amount of water also means less wastage.
Similarly, on the production side, efficiency comes from understanding the value you are adding. All our workers, production managers, supervisors and line managers do not measure efficiency by the number of pieces they make rather calculate the standard minute value they are adding. They know how much standard time each garment requires to be produced and thus work accordingly. Lean production methods are applied to the production lines. During small orders, we produce those orders in cluster lines which helps us in saving idle minutes on unutilized machines. This is why we promote the idea of cluster lines in the factory for producing small size orders using 5 people cluster circles instead of having the usual 30 people. Regarding efficiency, we make our management team go through courses to find out new ways of fine-tuning assemblies so that they become more efficient. Once the concept is understood, the execution becomes much easier.
We arrange regular training sessions for our employees which take place a few times in a month. It is never for the whole factory together, rather conducted in sections. Alongside this, skill development programs for the machine suppliers and standard minute value program for all the line managers are also arranged within and beyond the premises. The machine suppliers are often sent to conduct training programs for our operators in Italy or Germany and visit Switzerland to learn what new products are coming in and how can they be used efficiently.
You have been involved in many CSR activities in the past few years of operation. Could you detail your ‘Jaipur Foot’ and ‘Cleft Surgery’ initiatives?
This is a very passionate part of my life. My wife, Sadia Moyeen, initiated Jaipur Foot. We set up Moyeen Foundation together to support this cause. Bangladesh has a huge number of disabled people. According to the statistics, 5,000 people every year are coming in as accident victims, so the number of handicapped people is increasing day by day. We decided not to limit this to be a one-time attempt rather find a way in which we can do this consistently over the years and help change many lives. An entire team of technicians fly in from Jaipur to Bangladesh to make these limbs and support our initiative. We decided to make only 600 artificial limbs every year because that amount was possible to be made in a month’s time. The technicians would come here for a month, make the limbs, distribute and leave. This is how it has been running for the past 3 years. The entire procedure that would have required lacs if done abroad can be done at Tk. 11,500 per limb, which is not much but it changes lives. We have delivered up to 1,900 limbs now so they can walk back home. This foundation is mainly supported by raising funds from family friends and corporates, and I am glad the Almighty has blessed us to be able to do so.
Apart from Jaipur Foot, we have also been involved in an activity called Operation Cleft. This I did jointly with the rotary club of Melbourne. We collaborated with them as they provide 1,000 limbs a year in Bangladesh. Thus, we jointly completed around 1,350 cleft surgeries a year. This is mostly for young kids, especially people who are born into families who cannot afford it. You can imagine a child born with a distorted face, and we bring those children into the camps with their parents, do the surgery, fix them and send them back.
Another initiative that we have opened is an online school in Habiganj inside a tea plantation. This is our family tea plantation, and such plantations are still abided by the traditional ways of working. The schools around the area are quite regressive, so I wanted to do something which would make a worthwhile change to the future of young children residing there. Far East does it jointly with JAAGO foundation and is supported by GrameenPhone alongside. We managed to enroll 120 children there who are all taking English medium classes via an online class hosted in Gulshan. I plan to build a new school by 2019 and hopefully enroll about 400 kids there.
ASIF MOYEEN ELABORATES ON HIS SECRETS TO SUCCESS:
LEARN TO MARKET
The first lesson you must learn whenever you get into any business is selling your business’s products and services. One must have powerful marketing skills which means you must know your product, and it’s pricing and understand how that product and pricing is placed internationally to a buyer or a consumer. The gap that will exist between your product and what the market is offering will be your potential profit. Thus, it is very important to brush up your marketing skills initially.
In case of a manufacturing business like mine, it is essential to create a management capability, which is larger than the business opportunity. For instance, if you have a machine, which can produce 100 pieces and the amount you want to sell is 105, the chances are that you will fail. However, if you have a management capability that is greater than your selling power, then that will allow you to move forward. In this way, you can have the control over your business, satisfy your customers, not have the delays, and will be able to package and finish everything in higher quality.
In most cases, you will find that most people take up several businesses and try to execute them without investing much in forming a robust team. However, they often forget the fact that a team is a long-term investment and helps you keep your business in control. It is significant to have a team of people with loyalty, skill sets, and efficiency who can take the organization ahead. Far East today has 7,000 family members, and they are the people who have built the company not me.