Professor Michael Eugene Porter is the founder of modern industrial cluster concept through his book ‘the Competitive Advantage of Nations’. Similar but not the same concept one village one product, one city one product concept was originated in Far East in early 80s. But industrial cluster concept has basic differences than that of the said concepts. The term cluster is commonly known as industrial cluster, competitive cluster, Porterian cluster. Michael Porter claims that clusters have the potential to affect competition in following three ways:
By increasing the productivity of the companies in the cluster,
By driving innovation in the field,
By stimulating new businesses in the field.
A long list of economists, researchers, professors, practitioners have contributed to popularize the concept throughout the world. They have defined clusters from multiple aspects. A good number of models were developed for cluster development. A long list of organizations including the United Nations Industrial Development Organization (UNIDO), the World Bank, Government of Several Countries and Think tanks came forward and popularized the concept.
Clustering can contribute to knowledge dissemination, increase of competitiveness; improve products quality, capacity building of employees, facilitating innovation in the society. All of the above-mentioned factor’s resultants into a positive change and fostering industrialization of the country. Thus, cluster contributes to increasing GDP growth, generating employment, increasing export earnings, and finally poverty alleviation of a country.
Cluster based entrepreneurship development could ensure optimum use of lands, industrial logistics, and other factors of production. Ensuring compliance and environmental safety in a cluster is much easier for the state / entrepreneurs. Revenue collection and providing incentives in a cluster is much easy than that of the scattered enterprises of a country.
What and why is Clustering?
Definition of cluster:
Different economists, researchers, practitioners and organization have defined industrial clusters in different ways. Followings are the notable definitions of industrial cluster:
Michael E. Porter, who is recognized as the founder of industrial cluster concept, defined the cluster as “geographic concentration of interconnected businesses and associated institutions in a particular field” [1].
United Nations Industrial Development Organization (UNIDO) defines industrial cluster as: “Cluster can be defined as concentration of micro, small and medium enterprises in a given geographical location producing same or a similar type of products or services and these enterprises face similar type of opportunities and threats. The cluster is known by the name of the product being produced by principal firms and the place they are located in”.
SME Foundation (Bangladesh) has defined cluster as “A Cluster is a concentration of enterprises producing similar products or services and is situated within an adjoining geographical location around 5 km radius and having a common strengths, weaknesses, opportunities and threats”.
Rosenfeld (1997) defined cluster as “Geographically bounded concentration of similar, related or complementary businesses, with active channels for business transactions, communications and dialogue, that share specialized infrastructure, labor markets and services, and that are faced with common opportunities and threats.”
Enright (1998) defined cluster as “Regional clustering has been used to describe industrial districts of small crafts firms, high technology centers, agglomerations of financial and business service firms in cities, company towns, and large branch plants and their supply chains.” “…clusters at least must be characterized along relevant dimensions if appropriate policies are to be devised … (these include) …density. Breadth depth…activity base…growth potential…innovative capacity”.
Cluster Development Program of the Ministry of MSME (Government of India) defined it as “A cluster is a group of enterprises located within an identifiable and as far as practicable, contiguous area and producing same/similar products/services”.
Government of Gujarat (India) defined cluster as “A minimum of 50 industrial units, indulging in the manufacture of the same or related products and located within a radius of 10 km in a particular location, is referred to as a cluster”.
Almost all of the above definition considered the following factors to define a cluster:
A cluster displays a shared identity and future vision.
A cluster is an arena of dense and changing vertical input-output linkages, supply chains and horizontal inter-firm networks.
Products or services should be similar or homogenous along with related products.
Enterprises must be production or service units with colocation, interlinked, and interdependent.
Adjoining geographical location: several villages, wards, unions and industrial estates
Over time, clusters can reveal features of emergence, dominance and decline.
Cluster Development Handbook
Classification:
Clusters can be categorized in different perspective, feature, origin, function, stage of development, market orientation, as follows:
Classification based on origin: Clusters are classified into two major categories based on their origin. These are naturally grown clusters and man-made clusters.
Classification based on stage of development: Clusters are classified into three major categories based on the stage of development. These are growing cluster, matured cluster, declining cluster.
Classification based on activity performs: If the enterprises of a cluster manufacturing oriented is known as Manufacturing Cluster. While enterprises of a cluster provide service the cluster is termed as Service Cluster.
Classification based on size of cluster enterprises: Clusters could be termed as SME cluster if the enterprises of that cluster represent small and medium segment of the industry. Export oriented cluster dominated by exporters.
Classification based on technology used: Categorization can also be made based on the technology they use. There could be family-based Artisan clusters if they are using indigenous technology, whereas the enterprises in a cluster using modern technology and labor force outside the family members can be termed as. Industrial cluster.
Importance of Cluster:
Enterprises of a cluster are collocated, interdependent, interlinked, and shares common strengths, weaknesses, opportunity and threats. As a result, an invisible competition is there among the enterprises to produce qualitative products in competitive price. Firms are always in thinking of additional feature of a common product to get comparative advantage in the market. New innovation and higher productivity provide economies of scale where large numbers of buyers are available at a cluster. Enterprises located at a cluster enjoys following positive impacts:
Higher productivity
Better quality
Economies of scale
Availability of buyers
Availability of high standard raw materials
Availability of skilled labors
Knowledge about newer technology
Shared vision
Competitive tendency
Innovation
New product development
New features in existing product line
Collective negotiation (with government and policy makers) power
Collective action / joint effort etc.
Role of Government and Development Partners
It is the government who is responsible for creating and maintaining a pro-growth entrepreneurial environment through policy, fiscal, capacity, technology, market access etc. supports. An entrepreneur is a self-employed person generates employment opportunity for several unemployed population and perform value addition every day. Cluster is that entrepreneurial garden where he / she could enjoy every business logistics easy at his / her doorstep. Richer cluster could promote increasing trend of GDP growth and finally contribute to strengthening economic condition of the country.
Increased production means increased revenue; increased revenue could enrich government treasury. So, government has a very vital role to foster cluster development movement in a country. It is the government who could establish dedicated cluster development agency in the country. It is government who could direct development partners towards cluster development even in absence of cluster entrepreneurs or stakeholder.
Government could facilitate regional development program, fight regional unemployment, and promote traditional products of that region through cluster development activities. There are long lists of stakeholders for developing a cluster and government could effectively coordinate among them. Stakeholders of a cluster could be enlisted as follows:
Entrepreneurs
Local government institution (union / upzila / municipal administration)
Raw material suppliers
Income tax, VAT and Customs authority
Department of environment
Road construction authority
Electricity, gas, water and other utility supplying authority
Controller of import export authority
Law enforcement agencies
Wastages management authority
Printing and packaging businesses
Transport companies
Intermediary raw materials suppliers
Repairing workshops
Standard authority
Training centers, technology suppliers
Common facility centers
Banks and non-bank financial institutes
Insurance companies
Technical and other facility providing government agencies.
Workers
Buyers
Think-tanks.
Large national / international companies of the same product manufacturing
Support service providers
Government and development partners etc.
From the above list of clusters stakeholders, it is clear that multi-dimensional stakeholders are involved with a cluster development process. Some of them are government agencies, some of them are forward or backward linkage business entity, few local, national and even few international organizations are involved with the process. Therefore, it is necessary to play the role of coordinator here in this process. Able and effective coordinator could be a powerful government agency or the government itself.
Definition and Importance of Cluster Development
Among other roles government has to adopt a policy stand, prepare cluster development action plan, and mobilize resources, building capacity of entrepreneurs, workers, professionals, suppliers, and other key stakeholders. Government has to encourage development partners to finance, technology, and other required know how for fostering development of the cluster. Finally, it is the government who has to educate the stakeholders and inspire to play respective role for long term sustainability of the cluster against mutual benefits. Government (cluster development agency) could play following roles in cluster development:
Strengthen relationship among the public sector agencies, donors, cluster stakeholders etc.
Organize dialogues between cluster people, donors and academia for establishing academia – industry – donor linkage.
Aliening government support in line with the cluster / sectoral needs.
Identify regulatory barriers / burdens and resolve these.
Engaging development partners
Designing and implementing development interventions
Ensuring smooth supply of resources to continue and sustain the development.
Development partners especially the multinational development partners have diverse experience of working with the same issue in other countries earlier. Therefore, development partners could suggest, guide and direct the government for taking cluster development initiative to ensure sustainable development of the country in long run. Experience sharing of the development partners could educate the local government, cluster people and other stakeholders to think with the issues and replicate.
Cluster Identification and Initial Preparations
Some clusters are automatically grown due to market mechanism of few locations. Influential factors of a naturally grown cluster could be availability of raw materials, availability of skilled labor, market demand, good communication facility, traditionally manufacturing products, lifestyle of the local people etc. A naturally grown cluster is a place where a large number (50 and above) of homogeneous manufacturing entities are collocated at an adjoining area and produce same or similar products over a long period of time without any preplanned government mechanism. In Bangladesh, SME Foundation has identified 177 naturally grown SME clusters located at 51 districts of the country.
On the other hand, man-made clusters are the collocated group of enterprises established under a preplanned mechanism of the government or development partners or private initiative.
First initiative of cluster development process of a country is identifying existing naturally grown clusters of that country / province / locality. It is census types of activity just to identify and locate collocated industrial places under a certain definition and spot mark in the national geographic map along with some basic information.
Steps to identify naturally grown clusters of a country:
Defining cluster as per socioeconomic condition of the country or selecting an existing definition as standard.
Forming a governing team along with representatives of relevant government agencies, trade bodies, civil society, cluster experts, journalists and public representatives.
Forming study team with relevant expertise like economist, statisticians, GPRS expert, GIS experts, and data enumerators etc.
Sending the enumerators to an administrative area it could be a district wise, upzila or municipal area for collecting information.
Communicating with probable data sources like trade license issuing authority, Tax office, Upazila Administration / District Administration, Local Chamber of Commerce, Press Club etc.
Physical visit to the probable area.
Recording primary information about a potential cluster area.
Marking that area in geographic map of the country.
Recording GPS data
Preparing database through data entry
Data cleaning and data preparation
Data analysis and finalizing the cluster map of the country.
Report writing with basic information about each of the identified clusters
Cross-checking through validation meeting with stakeholders of the identified area for authentication of cluster data.
Finalizing the report and map.
Tools could be used in cluster identification step:
A concept notes cum census guideline.
Questionnaire for cluster information collection
Questionnaire for enterprise survey
Guideline for Key Informant Interview
Training for enumerators.
M&E System.
Concept note:
It is a written document includes definition of a cluster, what is not a cluster, what are the prospective sources of information, list of stakeholders, duties and responsibilities of the involved officials, reporting obligation of each of the parties, time bound action plan of the whole identification tasks along with geographical details, deadline for closing the major tasks, monitoring and evaluation system to monitor the overall activities.
Questionnaire for cluster information collection:
It is a set of question for recording basic information and geographical location of cluster. It is necessary to fill up 5-7 questionnaires from the stakeholders of a single cluster to facilitate cross checking of information and get an overall idea of the cluster.
Questionnaire for enterprise survey:
An enterprise survey should be conducted during the identification visit of the cluster to know basic features of the cluster enterprise. It will facilitate to know business environment of the cluster in brief.
Key Informant Interview:
About 10 – 15 Key Informant Interviews could be conducted to validate and cross check the information gathered from cluster questionnaire and enterprise survey. Entrepreneurs, Policy Makers, Local Administration, Peoples Representative, Journalist, Teachers of that particular location could be selected as key informant.
Training up the enumerators:
Skilled enumerators could collect concrete data. Therefore, it is necessary to conduct a training session for enumerators of duration of three – five days to orient them about the objective, scope, process, timeframe of cluster identification. Does and don’ts of enumerators, data collection techniques, data checking / testing techniques, data validation techniques etc. could be included in the course curriculum of the training.
M&E System:
Close monitoring and evaluation are essential to ensure quality of the task. Monitoring during field work is essential weather the enumerators are going to every potential data source or not. Weather they are visiting all potential places or not. Weather they are including a non-qualified location as cluster or excluding a qualified place from the cluster list etc. could be monitored to ensure quality of the output. A dedicated team has to be involved for Monitoring field work of each of the location during the cluster identification field work.
Definition and Importance of Cluster Development, this is the summary of two chapters of the book “Cluster Development Handbook” of the Author. To purchase the book click here.
*Author’s Short Profile:
Md. Joynal Abdin
Mr. Md. Joynal Abdin is a Business Consultant & Digital Marketer based in Dhaka, Bangladesh. He is also Co-Founder & CEO of Bangladesh Trade Center. Previously he served at Dhaka Chamber of Commerce & Industry (DCCI) as Executive Secretary; DCCI Business Institute (DBI) as Executive Director; SME Foundation as Deputy Manager; and the Federation of Bangladesh Chambers of Commerce & Industry (FBCCI) as Assistant Secretary.
The list of services Mr. Abdin is offering includes but not limited to Business Research and Documentations like Feasibility Study, Project Proposal Preparation, Writing Business Manual, Standard Operating Procedures etc.; Export Market Selection and Product Positioning at Home and Abroad; Buyers-Sellers Matchmaking; Website Development; Search Engine Optimization (SEO); and Social Media Marketing etc.
Definition and Importance of Cluster Development, this is the summary of two chapters of the book “Cluster Development Handbook” of the Author. To purchase the book click here.
Bangladesh, with its rapidly growing economy and abundant investment opportunities, has emerged as an attractive destination for both domestic and foreign investors. With a population exceeding 160 million and a strategic location in South Asia, the country offers a vast consumer market and a gateway to regional trade. Over the past few decades, Bangladesh has witnessed substantial economic growth, driven primarily by its thriving textile and apparel industry, remittances from the expatriate workforce, and a growing service sector. However, despite its promising prospects, investing in Bangladesh comes with its share of challenges. This article explores the major obstacles that investors face in Bangladesh and offers strategic ways forward to harness its investment potential.
Challenges to Invest in Bangladesh:
1. Long permissions / registrations and licenses requirement: About 37 permissions / registration / license from different government agencies are required to invest and operate business in Bangladesh [26]. List of required permissions / registrations and licenses are enlisted at the following table:
Table – 1: List of permissions / registrations and licenses requirement.
Sl.
Description
Relevant Authority
1
Trade License
Local government authority like UP, City Corporation etc.
2
TIN Registration
Income tax authority (NBR)
3
VAT Registration
VAT Authority (NBR)
4
Joint Stock Registration (for Limited company / Partnership)
Office of the Registrar of Joint Stock Companies and Firms
5
Bank Account
Schedule Bank
6
Import Registration Certificate (IRC)
Office of the Chief Controller of Import & Export
7
Export Registration Certificate (ERC)
Office of the Chief Controller of Import & Export
8
Mushak – 7
VAT Authority (NBR)
9
Registration for Turnover Tax (if applicable)
NBR
10
Application for Tax Holiday (if applicable)
NBR
11
Application for Duty Draw Back (if Applicable)
Duty Exemption and Draw Back Office
12
Drug License (for pharmacy)
Directorate General of Drug Administration (DGDA)
13
BSTI Certificate
Bangladesh Standards & Testing Institute
14
Approval from Deputy Commissioners (For Diesel and Acid Business)
DC Office
15
Certificate from PETRO Bangla (for Diesel and Octane business)
PETRO Bangla Office
16
Insurance
Insurance Company
17
Application for land in EPZ / BSCIC Estate authority (If applicable )
Bangladesh Export Processing Zone Authority / Bangladesh Small & Cottage Industries Corporation
18
Application for Gas Connection (if required)
Local Gas Distribution Authority
19
Application for Electricity Connection
Local Electricity Distribution Authority
20
Application for Water & Sanitation Connection
Local water supply and Suarez authority.
21
Telephone and Fax Connection
Telecom operators.
22
Environment Clearance
Department of Environment
23
Fire License
Fire Service and Civil Defense
24
Approval from RAJUK for Factory Establishment
RAJUK / Other Municipal Corporations
25
Approval from Board of Investment
Board of Investment
26
Registration from DIFE
Department of Inspection for Factories and Establishments
27
Registration from Inspector of Boilers
Office of the Chief Inspector of Boilers
28
Construction Certificates
RAJUK or other Municipal Authority
29
Registration as Readymade Garments Unit (for Garments factories only)
Export Promotion Bureau (EPB)
30
Registration at BSCIC
Bangladesh Small and Cottage Industries Corporation (BSCIC)
31
Collecting GSP (For exporters)
EPB
32
Trademark Registration
Department of Patent Design and Trademark (DPDT)
33
Patent Registration
DPDT
34
Design Registration
DPDT
35
Bonded Warehouse License (for RMG Exporters)
Customs Bond Commissionerate
36
Labor Inspection
DIFE
37
Inspection by Consumer Rights Department
National Consumer Rights Protection Department
Source: Compiled by the author from different investment relevant government documents.
2. Absence of good governance and corrupt bureaucracy: A corruption free bureaucracy could offer prompt delivery of government services to enhance investment in Bangladesh.
3. Lengthy Judicial System: Lengthy and cumbersome judicial process is discouraging foreign investors to enter into Bangladesh.
4. Limited capacity to supply adequate electricity and gas to industries: About 47.90% of people are covering under electrification in Bangladesh. Currently about 7200 – 7500 MW of electricity is generating in a day. It is not sufficient to provide electricity supply into newer industries as demanded.
5. Absence of efficient physical infrastructure: There are two Sea ports in Bangladesh. But only Chittagong port is active. On the other hand only one Dhaka – Chittagong Highway is not sufficient to support total import – export trade of Bangladesh. As a result traffic jam is destroying our valuable time during international trade through this port. We are in need of a Deep Sea Port to enhance our international trade capabilities.
6. Absence of investment promoting agency: We have regulators to provide permissions and operate inspections in industrial establishments but we do not have a government agency to promote investment in larger scale. The SME Foundation is working to promote Small and Medium Enterprises but they do not have mandate to promote foreign investment or large scale local investment.
7. Lack of professionals and sector specific trained man power: Bangladesh is lagging behind in terms of trained manpower to meet up the demands from a modern industry. It is in terms of operators, trouble shooters or engineers etc. Government has to take the lead to produce sector specific trained manpower to feed the industries as well as create employment of the young generations.
8. Differential treatment with the change of government: With the change of political parties in the government of Bangladesh priorities of private sector changes. As a result there is a threat of discontinuity of government special supports with the change of parties in the government.
9. Lack of coordination among different organs of the government: Lack of administrative coordination among different governmental bodies caused private sector sufferings in few cases.
10. Delay to get services from support organizations: Delay of getting investment relevant government services like; permissions and licenses, electricity-gas and other logistics connections etc. or non-cooperation of the government officials may cause of hues sufferings of an investor.
Most Prospective Sectors to Invest in Bangladesh
Ways Forward:
The government of Bangladesh could take following initiative to create and maintain an investment friendly business environment in Bangladesh:
Reducing number of investment related permission / license / registration requirement: Decreasing number of permissions / registrations / licenses with a predetermined time frame / one stop investment requirement services could improve the investment environment in Bangladesh.
Providing quick utility connection: Ensuring hassle free and in time delivery of industrial utilities like Electricity, Gas and water supply to manufacturing and service providing business entities could inspire local and foreign investors to invest here in Bangladesh.
One stop investment service: Government could provide real time one stop investment relevant services through Bangladesh Investment Development Authority could improve present investment scarcity situation in Bangladesh.
Facilitating Establishment of Business Support Service Organizations: Government could facilitate establishment of management consultant type’s business support service organization in Bangladesh to guide local and foreign investors here in Bangladesh.
Establishment of Entrepreneurship Development Institute like India: Government of Bangladesh could establish Entrepreneurship Development Institute in Bangladesh by adopting Indian EDI model for producing entrepreneurs rather than investors.
Activating NCID with a full functioning secretariat: Existing National Council for Industrial Development (NCID) could make functional through establishing its own secretariat. It could play the role of coordinator among all investment relevant governmental bodies for ensuring quick delivery of services and holding dispute settlement mechanism among the investors and government agencies.
Strengthening SME Development / Cluster Development Activities: Government could strengthen SME Development and Cluster development organization through capacity building of officials, supplying adequate funds and providing legal power to act properly and involve other government agencies to cooperate with their industry development action plan.
Despite the challenges, Bangladesh offers immense potential for investors looking to tap into its growing economy and promising consumer market. By addressing infrastructure deficits, bureaucratic inefficiencies, and regulatory uncertainties, the government can foster a more conducive investment climate. Moreover, promoting education, skill development, and financial inclusion will strengthen the country’s human capital, making it an attractive destination for both domestic and foreign investors. As Bangladesh continues to embrace reforms and create a favorable business environment, the nation’s investment landscape is likely to flourish, benefiting the economy and investors alike.
Top 10 Challenges and Ways Forward to Invest in Bangladesh, this is the summary of two chapters of the book “Most Prospective Sectors to Invest in Bangladesh” of the Author. To purchase the book click here.
*Author’s Short Profile:
Md. Joynal Abdin
Mr. Md. Joynal Abdin is a Business Consultant & Digital Marketer based in Dhaka, Bangladesh. He is also Co-Founder & CEO of Bangladesh Trade Center. Previously he served at Dhaka Chamber of Commerce & Industry (DCCI) as Executive Secretary; DCCI Business Institute (DBI) as Executive Director; SME Foundation as Deputy Manager; and the Federation of Bangladesh Chambers of Commerce & Industry (FBCCI) as Assistant Secretary.
The list of services Mr. Abdin is offering includes but not limited to Business Research and Documentations like Feasibility Study, Project Proposal Preparation, Writing Business Manual, Standard Operating Procedures etc.; Export Market Selection and Product Positioning at Home and Abroad; Buyers-Sellers Matchmaking; Website Development; Search Engine Optimization (SEO); and Social Media Marketing etc.
Top 10 Challenges and Ways Forward to Invest in Bangladesh, this is the summary of two chapters of the book “Most Prospective Sectors to Invest in Bangladesh” of the Author. To purchase the book click here.
Major business sectors of Bangladesh economy could be classified into three broad heads, namely industrial (manufacturing) sectors, Service sectors, agriculture (agro-processing) sectors. Major sectors of Bangladesh economy are as follows:
Industrial (Manufacturing) Sectors of Bangladesh:
Agro-based and agro-processing industry
Readymade Garments Industry
Pharmaceuticals
Leather and Leather products
Light Engineering Industry
Jute and Jute products
Plastic Industry
Ship Building
Environment friendly ship breaking
Frozen Fish Industry
Home Textiles
Renewable Energy (Solar Power, Windmill)
Active Pharmaceuticals Ingredient Industry and Radio Pharmaceuticals Industry
Herbal Medicinal Plant
Basic chemicals/dye and chemicals
Radio-active (diffusion) Application Industry (e.g. developing quality of decaying polymer/preservation of food/ disinfecting medicinal equipment)
Development of Polymer Industry
Automobile Industry
Handicrafts
Energy Efficient Appliances/Manufacturing of Electronic goods/Development of Electronic materials
Tea Industry
Ceramics
Tissue Grafting and Biotechnology
Jewelry
Toy
Cosmetics and toiletries
Agar –Ator Industry
Furniture
Cement Industry
Md. Joynal Abdin, Business Consultant, Digital Marketer & Author
Major Service Sectors:
IT-based activities (system analysis, design, developing system solutions, information service, call centre service, offshore development Centre, business process outsourcing etc.)
Agro-based activities such as fishing, fish preservation and marketing
Construction industry and housing
Overseas Employment
Entertainment
Ginning and baling
Hospitals and clinics
Nuclear and Analytical Service (e.g. nuclear treatment etc.)
Horticulture, flower cultivation and flower marketing
Human Resource Development, Knowledge society with high quality merit and efficiency
Tourism
Testing Laboratory
Photography
Telecommunication
Transport and communication
Warehouse and container service
Engineering Consultancy
Filling Stations (Petrol pump, CNG conversion centre etc.)
Private Inland Container Depot and Container Freight Station
Tank Terminal
Chain Super Market/Shopping Mall
Aviation Service
Inspection and testing service
Regional Feeder vessel and coastal ship service.
Dry socking and ship servicing
Modernised Cleaning Service for High-rise Apartments, Commercial Building
Auto mobile service
Technical Vocational Institute
Production and Marketing of poultry and dairy products
Advertising Industry and modelling e.g. print modelling, TV commercials, ramp modelling, catwalk, fashion
Production, supply and distribution of power in the private sector
Outsourcing and Security Service (Private Security forces/manpower supply)
Cold storage (processing and preservation of edible potato and seed potato, fruits, vegetables etc.)
Production of wood, bamboo and cane furniture (exclusive of cottage industry)
Flower preservation and export
Meat processing
Production of Bio slurry, mixed manure and urea
Production of bio-pesticides, neem pesticides etc.
apiculture
Particle board
Sweetening products
Soya food production & processing
Mustard oil producing industry (if local variety is used)
Rubber goods making project.
Rice bran oil.
Seed industry
Milk and poultry production and supply.
Horticulture, floriculture, flower cultivation, flower and vegetable marketing (lemon, mushroom, battle leaf and honey is included in this industry).
Business Sectors & Investment Incentives in Bangladesh, this is the summary of two chapters from the book “Most Prospective Sectors to Invest in Bangladesh” of the Author. To purchase the book click here.
Most Prospective Sectors to Invest in Bangladesh
Business Sectors & Investment Incentives in Bangladesh, this is the summary of two chapters from the book “Most Prospective Sectors to Invest in Bangladesh” of the Author. To purchase the book click here.
Investment incentives offered by Bangladesh:
Bangladesh achieved independence from Pakistan through a bloody liberation war for 9 months at a cost of 3 million lives. After liberation war major investment was in reconstruction of the bridges, railway lines, water ways, ports and a large number of developing houses destroyed or burnt during the war. The first five years plan was prepared in a spirit to achieve socialism in the country. There was thus emphasis on investment in public sector. In the early 1980s the trend reversed and started a new trend of privatizing state-owned enterprises (SOE). Many SOEs were sold out to private owners, at the same time new enterprises started to be developed in private sector.
The government has designed and implemented different policy reforms for creating more open and competitive environment for local and foreign investment. Considerable reforms and policy changes have been brought in recent years to promote the congenial atmosphere for foreign direct investment in Bangladesh. Private investment from foreign sources is welcome in all areas except four strategic industries reserved for public sector only namely Arms and ammunitions and other defense equipment and machinery; Production of nuclear energy; Forest plantation and machinated extraction within the bounds of reserve forest; and Security printing currency notes and minting. The foreign private investment (promotion and protection) Act, 1980 has been passed that ensures legal protection to foreign investment against nationalization and expropriation. It also guarantees repatriation of capital and dividend; and equitable treatment with local investors with regard to indemnification, compensation, restitution, or other entitlement as is accorded to investment. The government has made bilateral agreements for avoidance of double taxation with 26 countries and negotiations are going on with 23 countries.
Investment treaty for promotion and protection of investment between Bangladesh and twenty countries have been concluded and negotiations are going on with 9 other countries. Besides these, Bangladesh is a signatory to MIGA (Multilateral Investment Guarantee Agency), OPIC (Overseas Private Investment Corporation) of USA, ICSID (International Centre for Settlement of Investment Disputes) and a number of WIPOs (World Intellectual Property Organization) a Permanent committee on development and cooperation related to industrial prosperity. Adequate provision is also made available for intellectual property rights, such as patents, design and trademarks and copy right.
The government has already enacted bankruptcy law. A law commission has been constituted with a view to identify the anomalies and weaknesses in the existing laws and legal system. One of the main tasks of this commission is updating the existing laws in relation to industries, trade and business.
All these are expected to improve general business environment along with the environment of FDI. Efforts are being made to reform the bureaucratic administration in order to make it efficient and supportive of better services for inflow of FDI and economic development oriented activities. Substantial modifications have been made to up-date the laws dealing with financial sector. The Companies act 1994 and labor Act 2006 have been enacted for facilitating inflow of FDIs in Bangladesh.
In order to improve the environment of private foreign investment and FDI, several EPZs have been established in Chittagong, Dhaka, Khulna under the Bangladesh Export Processing Zones Authority (BEPZA) in 1980. The private Export Processing Zones (PEPZs) Act has also been enacted to encourage the establishment of “Private Export Processing Zones” by the local and foreign investors. These EPZs are well enriched with the necessary infrastructural facilities and are completely protected from any law and order problems or union activities.
The BEPZA approves all projects to be located in the EPZS and offers “One window same day service” to the investors in the EPZs. The government has also approved the private power generation policy of 1996 and tax exemption on income of the company for 15 years from the date of commercial production is allowed.
The Government has undertaken several steps to make import liberalization and industrial deregulations more effective including announcing its strategy of reducing effective protection over the medium term, continuing its efforts to lower and simplify tariffs, publishing a clear tariff schedule, developing an action plan for legal reforms and a blue pint for deregulation, and putting an action plan for implementing its exports development strategy. These efforts have improved the investment environment in Bangladesh.
Bangladesh is one of the promising economies with a large domestic market, availability of labor with competitive price, low utility charges, two Seaports and a potential Deep Seaport facility, long-term tax holiday, 100% repatriation facility, and easy access to largest regional market like India and China.
Facilities and Incentives for a foreign investor:
Tax exemption on royalties, technical knowhow and technical assistance fees and facilities for their repatriation
Tax exemption on interests on foreign loans
Tax exemptions on capital gains from transfer of shares by the investing company
Remittances of up to 50% of salaries of the foreigners employed in Bangladesh and facilities for repatriation of their savings and retirement benefits at the time of their return
No restrictions on issuance of work permits to project related foreign nationals and employees
Facilities for repatriation of invested capital, profits and dividends
Provision of transfer of shares held by foreign shareholders to local investors
Reinvestment of remittable dividends would be treated as new investment
Level playing field: foreign owned companies duly registered in Bangladesh will be on the same footing as locally owned ones
Invest in Bangladesh
Fiscal incentives:
Corporate tax holiday of 5 to 7 years for selected sectors
Reduced tariff on import of raw materials capital machinery
Bonded warehousing
Accelerated depreciation on cost of machinery is admissible for new industrial undertaking (50% in the first year of commercial production, 30% in the second year, and 20% in the third year)
Tax exemption on capital gains from the transfer of shares of public limited companies listed with a stock exchange
Reduced Corporate Tax for 5 to 7 years in lieu of tax holding and agricultural deprecation.
Financial incentives for export oriented industries:
Cash incentives and export subsidies ranging from 5% to 20% granted on the FOB value of the selected products
90% loans against letters of credit (by banks)
Permission for domestic market sales of up to 20% of export-oriented companies outside EPZ (relevant duties apply)
Additional Facilities / Incentives:
100% foreign equity allowed
Unrestricted exit policy
Remittance of royalty, technical know-how and technical assistance fees
Full repatriation facilities of dividends and capital at exit
Citizenship by investing a minimum of US$ 5,00,000
Permanent resident permits on investing US$ 75,000
An investor can wind up investment either through a decision of the AGM or He or she can repatriate the sales proceeds after securing proper authorization from the Central Bank
Other factors of Investment Environment:
Bangladesh offers investment friendly environment compared to the other South Asian Countries. Salient features are enumerated below:
Largely a homogenous society with no major internal or external tension Bangladesh has a population with great resilience in the face of adversity.
The people of Bangladesh, a liberal democratic country irrespective of race and religion are living in harmony for years.
Bangladesh enjoys broad non-partisan political support for market-oriented reforms and offers the most investor-friendly regulatory regime in South Asia.
This country has a large trainable, enthusiastic, and hardworking low-cost labor force suitable for any labor-intensive industry.
A bridge between ASEAN and SAARC nations, the Geographical location of Bangladesh is ideal for global trades with very convenient access to international sea and air routes.
Bangladesh is endowed with abundant supply of natural gas, coal, water and very fertile soil.
Although Bangla is the official language. English is widely spoken as second language.
Increasing trend of per capita forecasting its purchasing power is increasing in the local market.
All Bangladesh products other than armaments enjoy complete duty and quota free access to EU, Japan, Canada, Australia, Norway and most of the developed countries. However, for apparel export to USA, Bangladesh has a quota regime which ended on 1st January 2005.
Export earning is continuously increasing.
Increasing trend of remittance.
Business Sectors & Investment Incentives in Bangladesh, This is the summary of two chapters from the book “Most Prospective Sectors to Invest in Bangladesh” of the Author. To purchase the book click here.
*Author’s Short Profile:
Md. Joynal Abdin
Mr. Md. Joynal Abdin is a Business Consultant & Digital Marketer based in Dhaka, Bangladesh. He is also Co-Founder & CEO of Bangladesh Trade Center. Previously he served at Dhaka Chamber of Commerce & Industry (DCCI) as Executive Secretary; DCCI Business Institute (DBI) as Executive Director; SME Foundation as Deputy Manager; and the Federation of Bangladesh Chambers of Commerce & Industry (FBCCI) as Assistant Secretary.
The list of services Mr. Abdin is offering includes but not limited to Business Research and Documentations like Feasibility Study, Project Proposal Preparation, Writing Business Manual, Standard Operating Procedures etc.; Export Market Selection and Product Positioning at Home and Abroad; Buyers-Sellers Matchmaking; Website Development; Search Engine Optimization (SEO); and Social Media Marketing etc.
Business Sectors & Investment Incentives in Bangladesh, This is the summary of two chapters from the book “Most Prospective Sectors to Invest in Bangladesh” of the Author. To purchase the book click here.
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A business consultant is a professional who provides expert advice and guidance to businesses with the aim of improving their efficiency, productivity, and overall performance. They offer objective insights, industry knowledge, and specialized skills to help companies solve problems, make strategic decisions, and achieve their business goals.
Classification:
Business consultants can be broadly classified into several categories based on their areas of expertise and the types of services they offer. Some common types include:
Management Consultants: They focus on improving overall organizational performance and management processes. They may advise on strategy development, organizational structure, leadership, and operational efficiency.
Financial Consultants: These consultants specialize in financial management, including budgeting, financial analysis, risk assessment, and investment strategies.
Marketing Consultants: Marketing consultants assist with marketing strategy, brand positioning, market research, and promotional activities to help businesses reach and engage their target audience effectively.
Human Resources Consultants: HR consultants guide talent acquisition, employee training, performance management, compensation, and HR policy development.
IT Consultants: IT consultants offer expertise in technology solutions, such as software implementation, cybersecurity, IT infrastructure, and digital transformation.
Strategy Consultants: Strategy consultants focus on developing and implementing long-term business strategies to gain a competitive advantage and drive growth.
Functions:
Diagnosing Issues: Business consultants analyze the company’s operations, processes, and challenges to identify areas that need improvement or optimization.
Providing Expert Advice: Consultants offer specialized knowledge and industry insights to help businesses make informed decisions and implement best practices.
Developing Strategies: They collaborate with company stakeholders to create actionable strategies that align with the organization’s goals.
Implementing Solutions: Consultants may assist in implementing their proposed solutions and guiding the company through the change management process.
Training and Skill Development: In some cases, consultants provide training to employees, empowering them with new skills and knowledge to improve performance.
Performance Monitoring: Consultants track the results of their interventions, monitoring key performance indicators (KPIs) to ensure the effectiveness of their recommendations.
Business Consultancy Services
Significance and Contribution of a Business Consultant in a Company:
Objective Insights: They offers an external and unbiased perspective, helping companies see their challenges and opportunities from a fresh angle.
Specialized Expertise: Consultants bring deep knowledge and experience in their respective fields, providing access to skills that the company may lack internally.
Efficiency Improvements: By identifying inefficiencies and streamlining processes, consultants help companies save time and resources, leading to cost savings and increased productivity.
Strategic Direction: Thay assist in setting clear goals and creating effective strategies to achieve them, ensuring the company stays focused and on track.
Problem-Solving: When businesses encounter complex challenges, consultants can analyze the situation and offer innovative solutions that the company may not have considered.
Risk Mitigation: Consultants can identify potential risks and vulnerabilities in the business and provide strategies to mitigate them, enhancing the company’s resilience.
Flexible Resource: Hiring a consultant provides companies with a flexible resource that can be engaged for specific projects or timeframes, without the commitment of a full-time employee.
Knowledge Transfer: As consultants work closely with the company, they often transfer valuable knowledge and skills to employees, empowering them for long-term success.
Adaptation to Change: Consultants assist companies in adapting to market trends, technological advancements, and industry changes, enabling them to stay competitive.
Accelerated Growth: With expert guidance, businesses can accelerate their growth and development, achieving milestones faster and more efficiently.
Why should a company have a Business Consultant?
A company should have a business consultant for a multitude of compelling reasons, all of which can significantly impact the company’s success, growth, and overall performance. Let’s explore some of the key reasons why having them is essential for any business:
Objective Insights and Fresh Perspective: Business consultants bring an external and unbiased viewpoint to the company. They can identify issues, challenges, and opportunities that may be overlooked by internal employees who are deeply ingrained in the day-to-day operations. This objective insight provides a fresh perspective, enabling the company to make better-informed decisions.
Specialized Expertise: They are experts in their respective fields, whether it’s management, finance, marketing, human resources, or technology. Their specialized knowledge and experience allow them to offer valuable insights and best practices that the company may not have access to internally.
Efficiency and Productivity Improvements: Consultants are adept at analyzing business processes and identifying inefficiencies. They can streamline operations, optimize workflows, and implement more efficient systems, leading to cost savings and increased productivity.
Strategic Planning and Direction: They help companies set clear goals and develop actionable strategies to achieve them. They assist in creating roadmaps for growth, expansion, and overcoming challenges, ensuring the company stays focused and on the right path.
Problem-Solving and Innovative Solutions: When companies encounter complex challenges or roadblocks, consultants can offer innovative solutions and approaches. Their experience in dealing with various business scenarios equips them to handle unique challenges effectively.
Risk Mitigation and Resilience: They can identify potential risks and vulnerabilities in the company’s operations, finances, or market position. They provide strategies to mitigate these risks, enhancing the company’s resilience to unexpected changes or crises.
Flexibility and Scalability: Hiring them provides a flexible resource that can be engaged for specific projects or timeframes. This allows the company to access specialized expertise without the commitment of hiring a full-time employee.
Knowledge Transfer and Employee Empowerment: As consultants work closely with the company, they often transfer valuable knowledge and skills to employees. This empowers the workforce, enabling them to develop new skills and capabilities for long-term success.
Market Insights and Competitive Advantage: They stay abreast of industry trends, market dynamics, and competitors. They provide valuable market insights that can give the company a competitive edge and help them adapt to changing market conditions.
Accelerated Growth and Development: With expert guidance, businesses can accelerate their growth and development. Consultants can assist in identifying growth opportunities, expanding into new markets, and achieving milestones faster and more efficiently.
Objectivity in Decision-Making: They can facilitate data-driven decision-making, removing emotional biases from the decision-making process. This results in more rational and logical choices for the company’s benefit.
Accountability and Implementation Support: They are not only provide recommendations but can also support the company in implementing changes and strategies. This ensures that proposed solutions are effectively executed, leading to tangible results.
In conclusion, a business consultant brings invaluable expertise, objectivity, and strategic thinking to the table. Their contribution can lead to improved efficiency, competitive advantage, and accelerated growth for the company. Whether it’s solving specific challenges, enhancing operations, or providing guidance for long-term success, having a them is a wise investment for any business aiming to thrive in a dynamic and competitive business landscape.
*Author’s Short Profile:
Mr. Md. Joynal Abdin is a Business Consultant & Digital Marketer based in Dhaka, Bangladesh. He is also Co-Founder & CEO of Bangladesh Trade Center. Previously he served at Dhaka Chamber of Commerce & Industry (DCCI) as Executive Secretary; DCCI Business Institute (DBI) as Executive Director; SME Foundation as Deputy Manager; and the Federation of Bangladesh Chambers of Commerce & Industry (FBCCI) as Assistant Secretary.
The list of services Mr. Abdin is offering includes but not limited to Business Research and Documentations like Feasibility Study, Project Proposal Preparation, Writing Business Manual, Standard Operating Procedures etc.; Export Market Selection and Product Positioning at Home and Abroad; Buyers-Sellers Matchmaking; Website Development; Search Engine Optimization (SEO); and Social Media Marketing etc.
Search Engine Optimization (SEO) is a crucial digital marketing practice that focuses on improving a website’s visibility and ranking in organic (non-paid) search engine results. The goal of SEO is to enhance a website’s relevance and authority in the eyes of search engines, ultimately driving more targeted traffic and increasing the likelihood of conversions. SEO encompasses various strategies and techniques that align with search engine algorithms and user intent to deliver the most relevant and valuable search results. Here’s an overview of Search Engine Optimization:
Understanding Search Engines: Search engines like Google, Bing, Yahoo, and others play a pivotal role in how users find information online. When users enter queries (keywords) into search engines, they are presented with a list of relevant web pages that match their search intent. The order of these results is determined by complex algorithms that evaluate numerous factors to rank web pages.
Importance of SEO: In today’s digital landscape, where billions of searches are conducted every day, the visibility of a website in search engine results is crucial. The majority of internet users click on results that appear on the first page, and especially the top positions, of search engine results. This makes SEO vital for businesses seeking to attract organic traffic, generate leads, and increase online visibility.
On-Page SEO: On-page SEO involves optimizing various elements directly on the website to improve its search engine ranking. This includes:
Keyword Research: Identifying relevant keywords and phrases that users are likely to search for when seeking information related to the website’s content.
Title Tags and Meta Descriptions: Crafting compelling and relevant title tags and Meta descriptions that accurately describe the page content and include targeted keywords.
URL Structure: Creating clean and descriptive URLs that provide valuable information to both search engines and users.
Header Tags: Using header tags (H1, H2, H3, etc.) to structure content and signal the importance of different sections to search engines.
Content Optimization: Creating high-quality and valuable content that satisfies user intent and incorporates targeted keywords naturally.
Internal Linking: Establishing a clear and logical internal linking structure to help search engines understand the hierarchy of the website’s content.
Mobile-Friendly Design: Ensuring the website is mobile-friendly and offers a seamless experience across different devices.
Off-Page SEO: Off-page SEO refers to optimization efforts that take place outside the website to improve its authority and reputation. Key off-page SEO strategies include:
Backlink Building: Acquiring high-quality and relevant backlinks from authoritative websites. Backlinks serve as “votes of confidence” for a website’s content and contribute to its credibility in search engines’ eyes.
Social Media Engagement: Leveraging social media platforms to amplify content, engage with the audience, and build brand visibility and authority.
Online Citations and Local SEO: For local businesses, optimizing online citations and local listings to improve visibility in local search results.
Technical SEO: Technical SEO focuses on optimizing the website’s technical aspects to improve its crawlability and indexation by search engines. Technical SEO considerations include:
XML Sitemap: Creating and submitting an XML sitemap to help search engines understand the website’s structure and discover its content more efficiently.
txt: Implementing a robots.txt file to instruct search engine crawlers on which parts of the website to crawl and which to exclude.
Website Speed: Ensuring the website loads quickly and offers a smooth user experience, as page speed is a significant ranking factor.
SSL Certificate: Implementing an SSL certificate to ensure secure communication between the website and its users, which is now a ranking factor.
SEO and User Experience: SEO is closely tied to user experience (UX). Search engines strive to deliver the most relevant and valuable results to users. Therefore, a positive user experience, such as fast loading times, easy navigation, and high-quality content, positively impacts SEO.
SEO Analytics and Monitoring: Continuous monitoring and analysis of SEO performance are essential to understand what strategies are working and where improvements are needed. Web analytics tools, like Google Analytics, provide valuable insights into website traffic, user behavior, and conversions.
Search Engine Optimization (SEO) is a critical digital marketing practice that focuses on optimizing websites to improve their visibility and ranking in search engine results. By implementing on-page, off-page, and technical SEO strategies, businesses can attract more organic traffic, reach their target audience, and increase their online presence. SEO is an ever-evolving discipline, as search engine algorithms and user behavior change, requiring marketers to stay updated with industry trends and best practices to achieve sustainable success in the competitive online landscape.
SEO
3.1 On-page and off-page SEO techniques
Search Engine Optimization (SEO) comprises various strategies aimed at improving a website’s visibility and ranking in search engine results. Two primary categories of SEO techniques are on-page SEO and off-page SEO. Each category focuses on different aspects of website optimization and plays a crucial role in enhancing a website’s authority, relevance, and overall SEO performance. Let’s delve into the details of on-page and off-page SEO techniques:
On-Page SEO Techniques: On-page SEO refers to the optimization efforts made directly on the website itself to improve its visibility and ranking in search engine results. These techniques focus on providing valuable content and optimizing various elements of each webpage to satisfy user intent and search engine algorithms. Some key on-page SEO techniques include:
Keyword Research: Conducting thorough keyword research to identify relevant and high-traffic keywords related to the website’s content. Using tools like Google Keyword Planner, SEMrush, or Ahrefs, marketers can uncover valuable keywords that align with user search queries.
Content Optimization: Creating high-quality, informative, and relevant content around targeted keywords. Content should address user needs and intent, providing valuable answers to their queries. Proper use of headers, paragraphs, and bullet points enhances readability and user experience.
Title Tags and Meta Descriptions: Crafting compelling and keyword-rich title tags and meta descriptions that accurately describe the webpage’s content. These elements act as a preview of the page in search engine results, influencing user click-through rates.
URL Structure: Creating user-friendly and descriptive URLs that include targeted keywords and provide valuable information about the webpage’s content. Short and clear URLs are preferred by both users and search engines.
Header Tags (H1, H2, H3, etc.): Using header tags to structure the content and signal the importance of different sections. Proper use of header tags helps search engines understand the hierarchy of the content.
Image Optimization: Optimizing images by using descriptive alt tags and compressing image file sizes to improve website loading speed and accessibility.
Internal Linking: Establishing a logical and relevant internal linking structure to connect related pages. Internal links help distribute link equity across the website and aid search engine crawlers in discovering and indexing content.
Mobile-Friendly Design: Ensuring the website is responsive and displays correctly on various devices, as mobile-friendliness is a significant ranking factor.
Page Speed Optimization: Improving website loading speed to enhance user experience and meet search engine requirements for faster websites.
Off-Page SEO Techniques: Off-page SEO refers to optimization efforts made outside the website to improve its authority, credibility, and reputation in the eyes of search engines. These techniques aim to build high-quality backlinks, foster brand visibility, and generate positive signals about the website’s relevance. Some key off-page SEO techniques include:
Link Building: Acquiring high-quality and relevant backlinks from authoritative websites in the same niche. Quality backlinks act as “votes of confidence” for the website’s content, signaling its credibility to search engines.
Social Media Engagement: Engaging with the target audience on social media platforms to promote content, share updates, and build a community around the brand. Social media signals can indirectly impact search engine rankings.
Online Citations and Local SEO: For local businesses, optimizing online citations and local business listings to improve visibility in local search results.
Influencer Marketing: Partnering with influencers and industry leaders to promote the brand and gain exposure to a larger audience.
Guest Blogging: Contributing high-quality guest posts to authoritative websites in the industry to earn backlinks and establish thought leadership.
Online PR and Brand Mentions: Building positive brand mentions and press coverage to enhance the brand’s reputation and increase brand visibility.
Social Bookmarking: Submitting website content and blog posts to social bookmarking websites to drive traffic and gain backlinks.
Forum Participation: Engaging in relevant forums and online communities to contribute valuable insights and establish the brand as an authority.
On-page and off-page SEO techniques work in tandem to optimize a website and enhance its search engine visibility and ranking. On-page SEO focuses on improving content quality, structure, and relevance, while off-page SEO emphasizes building authority, credibility, and backlinks from external sources. Implementing a comprehensive SEO strategy that incorporates both on-page and off-page techniques is crucial for businesses to improve organic visibility, attract targeted traffic, and succeed in the competitive online landscape.
3.2 Keyword research and competitor analysis
Keyword Research and Competitor Analysis are critical components of Search Engine Optimization (SEO) and digital marketing strategies. Conducting effective keyword research helps identify relevant and high-traffic keywords, while competitor analysis provides valuable insights into competitor strategies and opportunities. Here’s a step-by-step guide on how to perform keyword research and competitor analysis:
Keyword Research:
Define Your Objectives: Start by clarifying your SEO goals and objectives. Understand the purpose of your keyword research, whether it’s to increase organic traffic, target specific audiences, or improve rankings for certain topics or products.
Brainstorm Seed Keywords: Begin by brainstorming a list of seed keywords related to your business, products, or services. These are the broad terms that represent your main topics.
Use Keyword Research Tools: Utilize keyword research tools to expand your seed keyword list and discover relevant keywords. Popular tools include Google Keyword Planner, SEMrush, Ahrefs, Ubersuggest, and Moz Keyword Explorer.
Analyze Search Volume and Competition: Assess the search volume and competition level for each keyword. High search volume indicates higher potential traffic, while low competition suggests a better chance of ranking higher in search results.
Focus on Long-Tail Keywords: Long-tail keywords are more specific and usually have lower competition. Targeting long-tail keywords helps attract a more targeted audience and can lead to higher conversion rates.
Consider User Intent: Think about the intent behind each keyword. Are users looking for information, products, or services? Align your content with user intent to provide valuable answers to their queries.
Prioritize Keywords: Organize your list of keywords based on relevance and search volume. Prioritize keywords that align with your content strategy and have a good balance between search volume and competition.
Competitor Analysis:
Identify Competitors: Identify your main competitors in the digital space. Look for businesses targeting similar keywords and offering similar products or services.
Analyze Their Keywords: Use keyword research tools to discover the keywords your competitors are targeting. Analyze their organic and paid search keywords to understand their focus areas.
Assess Content Strategy: Study your competitors’ content strategy. Look for high-performing blog posts, landing pages, and other content that attract engagement and backlinks.
Backlink Analysis: Examine your competitors’ backlink profiles to identify high-quality websites linking to their content. This can give you insights into potential backlink opportunities for your website.
Social Media Presence: Evaluate your competitors’ social media presence and engagement. Understand which platforms they are active on and how they engage with their audience.
Monitor Paid Advertising: Keep an eye on your competitors’ paid advertising campaigns, such as Google Ads or social media ads. Analyze their ad copy, keywords, and landing pages to gain insights into their paid marketing strategies.
Identify Strengths and Weaknesses: Identify your competitors’ strengths and weaknesses. Assess areas where you can outperform them and capitalize on opportunities they may have missed.
Learn from Their Successes and Mistakes: Learn from your competitors’ successes and apply similar strategies to your own campaigns. Likewise, avoid making the same mistakes they might have made.
Keyword research and competitor analysis are essential steps in developing a successful SEO and digital marketing strategy. Keyword research helps identify relevant and valuable keywords to target, while competitor analysis provides insights into competitor strategies and areas of opportunity. By understanding user intent, prioritizing keywords, and learning from competitors, businesses can optimize their content and marketing efforts to attract targeted traffic, improve search engine rankings, and gain a competitive edge in the digital landscape.
Search Engine Optimization (SEO)
3.3 Technical SEO and website optimization
Technical SEO and website optimization focus on the technical aspects of a website to improve its crawlability, indexation, and overall search engine performance. These practices ensure that search engines can access, understand, and rank the website’s content effectively. Here’s a step-by-step guide on how to perform Technical SEO and website optimization:
Mobile-Friendly Design: Ensure that the website is responsive and displays correctly on various devices, including desktops, smartphones, and tablets. Mobile-friendliness is a crucial ranking factor, and search engines prioritize websites that offer a seamless mobile experience to users.
Website Speed Optimization: Improve website loading speed to enhance user experience and meet search engine requirements for faster websites. Compress images, leverage browser caching, and reduce server response time to achieve faster page load times.
XML Sitemap: Create and submit an XML sitemap to search engines. The sitemap provides a clear structure of the website’s content, making it easier for search engine crawlers to discover and index pages.
txt File: Implement a robots.txt file to instruct search engine crawlers on which parts of the website to crawl and which to exclude. This file helps prevent the crawling of duplicate or irrelevant content.
Canonical URLs: Implement canonical tags to address duplicate content issues. Canonical tags indicate the preferred version of a page when there are multiple versions with similar content.
SSL Certificate: Ensure the website has an SSL certificate to enable secure communication between the website and its users. Secure websites (HTTPS) are favored by search engines and provide a safer browsing experience for users.
Schema Markup: Use schema markup to provide search engines with additional information about the content on the website. Schema markup can enhance search engine results with rich snippets, such as star ratings, product information, and event details.
Optimize Robots Meta Tags: Use robots meta tags to control search engine crawlers’ behavior on specific pages. For example, you can use the “noindex” tag to prevent certain pages from being indexed in search results.
404 Error Pages: Customize 404 error pages to guide users back to relevant content if they encounter broken links or missing pages. A user-friendly 404 page improves the user experience and reduces bounce rates.
Internal Linking Structure: Establish a logical and well-structured internal linking system. Internal links help distribute link equity across the website and aid search engine crawlers in discovering and indexing content.
Fix Broken Links: Regularly check for broken links on the website and fix them promptly. Broken links can negatively impact user experience and crawlability.
Optimize Images: Compress images and use descriptive alt tags to improve website loading speed and provide alternative text for users with visual impairments.
Monitor Crawl Errors: Use Google Search Console or other tools to monitor and fix crawl errors. Addressing crawl errors ensures that search engines can access all relevant pages on the website.
Test and Optimize for Mobile: Conduct mobile usability tests to identify any issues on mobile devices. Optimize the website’s design and functionality for a seamless mobile experience.
Implement AMP (Accelerated Mobile Pages): For content-heavy websites, consider implementing AMP to provide a faster and smoother mobile experience for users.
Technical SEO and website optimization are essential for ensuring that search engines can crawl, understand, and index a website’s content effectively. By focusing on mobile-friendliness, page speed, XML sitemaps, canonical URLs, and other technical aspects, businesses can improve their search engine rankings and provide a better user experience. Regular monitoring, testing, and optimization help maintain a technically sound website that performs well in search engine results and attracts more targeted organic traffic.
Pay-Per-Click (PPC) Advertising
Pay-Per-Click (PPC) advertising is a digital marketing model where advertisers pay a fee each time their ad is clicked by a user. It is a highly effective and measurable form of online advertising that allows businesses to target specific audiences and drive relevant traffic to their websites or landing pages. PPC advertising is commonly used on search engines, social media platforms, and display networks, providing businesses with a wide range of options to reach their target audience. Here are some key details about Pay-Per-Click (PPC) Advertising:
How PPC Advertising Works: In a PPC advertising campaign, advertisers bid on specific keywords or target audience characteristics to have their ads displayed on relevant platforms. When a user searches for a keyword or matches the targeting criteria set by the advertiser, the ad is shown. Advertisers are only charged when someone clicks on their ad, leading to the advertiser’s website or landing page.
Platforms for PPC Advertising: PPC advertising is available on various platforms, including:
Search Engines: On search engines like Google and Bing, advertisers bid on keywords relevant to their products or services. When a user searches for those keywords, the ads appear at the top or bottom of the search results.
Social Media Platforms: Social media sites like Facebook, Instagram, Twitter, and LinkedIn offer PPC advertising options. Advertisers can target users based on demographics, interests, behavior, and more.
Display Networks: Display networks like Google Display Network and other ad networks allow advertisers to display visual banner ads on websites that are part of the network.
Video Platforms: Video advertising, such as YouTube ads, enables businesses to showcase video ads to a targeted audience based on their interests and behavior.
Benefits of PPC Advertising:
Highly Targeted: PPC allows precise targeting, ensuring that ads are shown to relevant users based on specific criteria like keywords, demographics, location, interests, and more.
Control Over Budget: Advertisers can set daily or monthly budgets to control their ad spend. They can adjust bids and budgets in real-time based on performance.
Immediate Results: Unlike organic search efforts, PPC campaigns can generate immediate traffic and results, making it an effective option for time-sensitive promotions or product launches.
Measurable and Trackable: PPC platforms provide detailed analytics and performance data, allowing advertisers to measure the success of their campaigns accurately.
Flexibility and Customization: Advertisers can test different ad formats, targeting options, and landing pages to find the most effective combinations.
Ad Formats in PPC Advertising:
Text Ads: Simple text-based ads with a headline, description, and URL link that appear on search engine results pages.
Display Ads: Visual banner ads with images or graphics that appear on websites within the display network.
Shopping Ads: Product-based ads that display product images, prices, and descriptions, commonly used in e-commerce PPC campaigns.
Video Ads: Video-based ads that play before, during, or after videos on platforms like YouTube.
Ad Auction and Quality Score: In PPC advertising, ad placement is determined through an auction process. Advertisers bid on keywords, and the platform considers the bid amount, ad relevance, and landing page experience to determine ad placement. The quality score is a metric used by platforms like Google Ads to assess ad relevancy and landing page experience, impacting ad rankings and cost-per-click.
Finally we can state that Pay-Per-Click (PPC) Advertising is a powerful digital marketing strategy that allows businesses to reach their target audience effectively and pay only for actual clicks on their ads. By leveraging various platforms and ad formats, businesses can drive relevant traffic to their websites, generate leads, and achieve their marketing objectives. PPC advertising provides immediate results, precise targeting, and measurable performance metrics, making it a valuable tool for businesses seeking to maximize their online visibility and conversions.
Search Engine Optimization (SEO)
4.1 Google Ads and Bing Ads
Google Ads and Bing Ads are two popular Pay-Per-Click (PPC) advertising platforms that allow businesses to display ads on their respective search engines. Both platforms provide advertisers with the opportunity to reach their target audience, generate website traffic, and achieve their marketing objectives. Here are some details about Google Ads and Bing Ads:
Google Ads:
Overview: Formerly known as Google AdWords, Google Ads is the most widely used PPC advertising platform globally. It allows advertisers to create and display text ads, display ads, shopping ads, and video ads on Google’s search engine results pages (SERPs), Google Display Network, YouTube, and partner websites.
Ad Formats: Google Ads offers various ad formats, including:
Text Ads: Simple text-based ads that appear above or below the organic search results on Google’s SERPs.
Display Ads: Visual banner ads that appear on websites within the Google Display Network, which includes a vast network of partner websites.
Shopping Ads: Product-based ads that display product images, prices, and descriptions, commonly used by e-commerce businesses to promote products.
Video Ads: Video-based ads that play before, during, or after YouTube videos and across the Google Display Network.
Keyword Targeting: Advertisers bid on specific keywords relevant to their products or services. When users search for those keywords, the ads are triggered and displayed based on the ad rank (bid amount and quality score).
Targeting Options: Google Ads offers various targeting options, including:
Location Targeting: Advertisers can target users based on specific locations, such as countries, cities, or radius targeting.
Demographic Targeting: Target users based on age, gender, household income, and parental status.
Interest Targeting: Reach users based on their interests, online behaviors, and browsing history.
Device Targeting: Optimize ad campaigns for specific devices like desktops, mobiles, and tablets.
Remarketing: Google Ads allows advertisers to target users who have previously interacted with their website, helping to re-engage potential customers.
Budget Control: Advertisers can set daily or monthly budgets to control their ad spend. They can also adjust bids and budgets in real-time based on performance.
Bing Ads:
Overview: Bing Ads is the PPC advertising platform of Microsoft, which powers ads on the Bing search engine, Yahoo, and other partner websites. While it has a smaller market share compared to Google, Bing Ads can still provide valuable opportunities to reach a different audience.
Ad Formats: Bing Ads offers similar ad formats to Google Ads:
Text Ads: Text-based ads that appear on the search engine results pages of Bing and Yahoo.
Shopping Ads: Product-based ads that showcase products and prices, similar to Google Shopping ads.
Audience Ads: Allows advertisers to target specific audience segments based on their behavior and interests.
Keyword Targeting: Advertisers bid on relevant keywords, and when users search for those keywords on Bing or Yahoo, the ads are displayed based on ad rank.
Targeting Options: Bing Ads provides various targeting options, including:
Location Targeting: Target users based on specific locations, similar to Google Ads.
Device Targeting: Optimize ad campaigns for desktop, mobile, or tablet devices.
Language Targeting: Advertisers can target users based on their language preferences.
Integration with Microsoft Products: Bing Ads offers unique integration with Microsoft products like Windows, Office, and Xbox, providing advertisers with access to a different audience segment.
Cost-Effective: Bing Ads can be more cost-effective compared to Google Ads, with potentially lower cost-per-click (CPC) rates and less competition in some industries.
Both Google Ads and Bing Ads are powerful PPC advertising platforms that offer businesses the opportunity to reach their target audience, generate website traffic, and achieve their marketing goals. Google Ads provides extensive reach and a wide range of ad formats across its search engine, display network, and video platform. On the other hand, Bing Ads offers access to a different audience and can be cost-effective for certain businesses. Choosing between the two platforms depends on the specific target audience, industry, and budget considerations of each advertiser. Businesses can benefit from running PPC campaigns on both Google Ads and Bing Ads to maximize their online visibility and conversions.
4.2 Keyword research and selection
Keyword research and selection are crucial steps in any successful digital marketing and SEO strategy. Properly chosen keywords can drive targeted traffic to your website, improve search engine rankings, and increase the chances of conversions. Here’s a step-by-step guide on how to conduct keyword research and select the right keywords for your campaign:
Define Your Goals and Objectives: Start by clarifying your marketing goals and objectives. Determine what you want to achieve with your keyword research, whether it’s to increase website traffic, generate leads, boost sales, or improve brand visibility.
Brainstorm Seed Keywords: Begin by brainstorming a list of seed keywords relevant to your business, products, or services. These are the broad terms that represent your main topics and will be the foundation for your keyword research.
Use Keyword Research Tools: Leverage keyword research tools to expand your seed keyword list and discover additional keywords with potential. Some popular keyword research tools include Google Keyword Planner, SEMrush, Ahrefs, Ubersuggest, and Moz Keyword Explorer.
Analyze Search Volume and Competition: For each keyword, analyze its search volume and competition level. High search volume indicates higher potential traffic, while low competition suggests a better chance of ranking higher in search results. Balancing search volume and competition is essential for targeting the right keywords.
Focus on Long-Tail Keywords: Consider incorporating long-tail keywords into your research. Long-tail keywords are more specific and usually have lower competition. Targeting long-tail keywords helps attract a more targeted audience and can lead to higher conversion rates.
Consider User Intent: Think about the intent behind each keyword. Understand whether users are looking for information, products, or services. Align your content and landing pages with user intent to provide valuable answers to their queries.
Prioritize Keywords: Organize your list of keywords based on relevance and search volume. Prioritize keywords that align with your content strategy and have a good balance between search volume and competition.
Analyze Competitor Keywords: Conduct competitor analysis to identify the keywords your competitors are targeting. Analyze their organic and paid search keywords to understand their focus areas and discover potential keyword opportunities.
Group Keywords into Themes: Group similar keywords into themes or clusters. This helps in organizing your content and creating targeted landing pages or blog posts for each keyword group.
Consider Local Keywords (if applicable): For local businesses, include location-based keywords to target users in specific geographic areas. Use city names, ZIP codes, or neighborhood names in your keyword selection.
Use Negative Keywords: Identify negative keywords, which are irrelevant terms that you want to exclude from your campaigns. Negative keywords help ensure that your ads are shown to the most relevant audience.
Review and Refine Your List: Regularly review and refine your keyword list based on the performance of your campaigns. Continuously update and optimize your keywords to stay relevant and competitive.
Monitor and Track Results: After implementing your selected keywords, monitor their performance using web analytics tools and PPC platform dashboards. Track key metrics like impressions, clicks, click-through rate (CTR), conversion rate, and return on investment (ROI).
The keyword research and selection are essential steps in any digital marketing strategy. A well-executed keyword research process helps you identify the most relevant and high-impact keywords to target. By considering user intent, search volume, competition, and analyzing competitor keywords, you can optimize your website, content, and paid advertising efforts to attract a targeted audience and achieve your marketing objectives effectively. Regular monitoring and optimization based on performance data will ensure your keyword strategy remains successful and adaptive to changing market trends and user behaviors.
Digital Marketing Tools
4.3 Ad creation and optimization
Ad creation and optimization are critical aspects of running successful advertising campaigns, whether on search engines, social media platforms, or display networks. Creating compelling and relevant ads and continuously optimizing their performance can significantly impact the success of your digital marketing efforts. Here’s a detailed guide on ad creation and optimization:
Ad Creation:
Understand Your Audience: Before creating ads, have a clear understanding of your target audience. Identify their preferences, pain points, and motivations, so you can craft ads that resonate with them.
Set Clear Objectives: Define your advertising objectives, such as increasing website traffic, generating leads, driving sales, or improving brand awareness. Your ad copy and design should align with these goals.
Choose the Right Platform: Select the appropriate advertising platform based on your audience’s behavior and preferences. Different platforms, like Google Ads, Facebook Ads, or display networks, offer various ad formats and targeting options.
Craft Compelling Ad Copy: Write engaging ad copy that highlights the unique selling points of your product or service. Use persuasive language, relevant keywords, and a clear call-to-action (CTA) to encourage clicks and conversions.
Ad Design and Imagery: Choose visually appealing and relevant imagery that complements your ad copy. High-quality images or videos can capture users’ attention and convey your message effectively.
Create Multiple Ad Variations: Test different ad variations to identify what resonates best with your audience. Experiment with various headlines, ad copy, and imagery to determine the most effective combinations.
Incorporate Ad Extensions: Utilize ad extensions to provide additional information and enhance your ads. Extensions like site links, call extensions, and location extensions can improve ad visibility and click-through rates.
Ad Optimization:
Monitor Key Metrics: Regularly monitor key performance metrics, such as click-through rate (CTR), conversion rate, cost per conversion (CPC), and return on ad spend (ROAS). This data provides insights into the effectiveness of your ads.
A/B Testing: Implement A/B testing to compare different ad variations and identify which elements perform best. Test headlines, ad copy, images, CTA buttons, and other components to optimize your ads continuously.
Bid Management: Adjust your bid strategy based on ad performance and campaign objectives. Allocate more budget to high-performing ads or keywords, while reducing bids for underperforming ones.
Keyword Optimization: For search engine advertising, regularly update your keyword list based on search trends and user behavior. Remove low-performing or irrelevant keywords and add new ones that align with your objectives.
Landing Page Optimization: Ensure that your landing pages are relevant to your ad copy and offer a seamless user experience. Optimize landing pages for speed, mobile responsiveness, and clear CTAs to improve conversions.
Ad Schedule and Geotargeting: Analyze ad performance by day and time to identify peak periods for your target audience. Utilize ad scheduling and geotargeting to display ads when your audience is most active and in specific locations.
Negative Keywords: Use negative keywords to prevent your ads from showing for irrelevant search queries. This helps optimize ad spend and ensures your ads are displayed to the most relevant audience.
Remarketing: Implement remarketing campaigns to re-engage users who have previously visited your website. Tailor ads based on their behavior to encourage return visits and conversions.
Performance-Based Budgeting: Allocate your budget based on the performance of each ad and campaign. Focus more on high-performing ads and reduce investment in low-performing ones.
Regular Analysis and Reporting: Continuously analyze the performance of your ads and campaigns. Prepare regular reports to assess progress toward your advertising goals and identify areas for improvement.
Please note that, the ad creation and optimization are continuous processes that play a crucial role in the success of your digital advertising efforts. By understanding your audience, crafting compelling ad copy, and continuously optimizing your ads based on performance data, you can attract a relevant audience, drive conversions, and maximize the return on your advertising investment. Regular monitoring, A/B testing, and adjustments to bid management, targeting, and ad content will help you stay competitive and achieve your advertising objectives effectively.
All about Digital Marketing [Episode-2]: All about Digital Marketing [Episode-2]: All about Digital Marketing [Episode-2]
*Author’s Short Profile:
Md. Joynal Abdin
Mr. Md. Joynal Abdin is a Business Consultant & Digital Marketer based in Dhaka, Bangladesh. He is also Co-Founder & CEO of Bangladesh Trade Center. Previously he served at Dhaka Chamber of Commerce & Industry (DCCI) as Executive Secretary; DCCI Business Institute (DBI) as Executive Director; SME Foundation as Deputy Manager; and the Federation of Bangladesh Chambers of Commerce & Industry (FBCCI) as Assistant Secretary.
The list of services Mr. Abdin is offering includes but not limited to Business Research and Documentations like Feasibility Study, Project Proposal Preparation, Writing Business Manual, Standard Operating Procedures etc.; Export Market Selection and Product Positioning at Home and Abroad; Buyers-Sellers Matchmaking; Website Development; Search Engine Optimization (SEO); and Social Media Marketing etc.
All about Digital Marketing [Episode-2]: All about Digital Marketing [Episode-2]: All about Digital Marketing [Episode-2]
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