VICTORVILLE, CA (BRAIN)—Bangladesh factory GermanBangla Bicycles has opened a U.S. subsidiary in Victorville, California, as it looks to drum up business among North American bicycle brands seeking a low cost manufacturing alternative to factories in China and Taiwan.
ZA Group, LLC is the newly formed distribution and marketing arm of GermanBangla (GBB), a joint venture between Bangladesh Power Trade Group and Germany’s Panther, one of Europe’s top suppliers. ZA Group is run by Sazed Alam, whose uncle owns a majority stake in GBB, and will be staffed with four employees acting as the main contact for U.S. suppliers. ZA is targeting dealers interested in a factory to produce house brands and suppliers of casual, recreational and lifestyle bikes.
“After attending Dealer Camp and Interbike for the last two years, speaking with USA bicycle brands and retailers, we have much more insight into the USA bicycle market, and what American consumer demands. We are now ready to build partnerships with USA bicycle suppliers,” Alam said.
GBB has invested $7 million into the factory, which opened in 2008 about 15 miles outside of the capital city of Dhaka. The 150,000 square foot factory has a capacity of 350,000 frames per year, only a portion of which is being utilized by OEMs Panther, Onyx, Takara World and Deltadesh. The factory focuses primarily on steel frames, but has options to work with aluminum as well, Alam said.
Bike manufacturing is one of Bangladesh’s fastest growing industries, Alam said, and the Asian country situated between Myanmar and India is home to five large bike factories. Bangladesh is the fifth largest bicycle supplier to Europe. The growing interest is due to inexpensive labor—rates run 23 to 25 cents per hour, about half that of India, a third of China and a fourth of Taiwan—and low import duties.
The cost to import to the U.S from Bangladesh is a 5.5 percent tax. There are no import duties because of the U.S. Generalized System of Preferences Program, which creates duty-free entry for products exported from developing countries to promote growth. For more information on GBB, go to www.chooseyourem.com.
—Nicole Formosa
nformosa@bicycleretailer.com
