Nine representatives from six major garment sourcing nations have issued a joint call to global brands and retailers to consider the potential impacts on workers and small business enterprises in their supply chains when making purchasing decisions.
Garment manufacturer representatives in Cambodia, Vietnam, Pakistan, China, Myanmar and Bangladesh have come together in a joint effort as many report facing pressure from global buyers to cancel processed orders and/or delay payments.
The coalition comprises nine textile and garment business associations of the STAR Network (Sustainable Textile of Asian Region). Signatories to the joint statement include the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), China National Textile and Apparel Council (CNTAC), Garment Manufacturers Association in Cambodia (GMAC), Myanmar Garment Manufacturers Association (MGMA), Pakistan Hosiery Manufacturers and Exporters Association (PHMA), Pakistan Textile Exporters Association (PTEA), Towel Manufacturers Association of Pakistan (TMA) and Vietnam Textile and Garment Association (VITAS).
“During this unprecedented time of global outbreak of the Covid-19, responsible business has become more important than ever for the whole world to survive and recover from the crisis,” reads the statement. “Especially, responsible purchasing practices of brand companies, retailers and traders of the global textile and apparel supply chains, will bring enormous impacts on the fundamental rights of millions of workers and the livelihood of their families in the supplier end. It is time for global businesses to uphold and honour their commitment to labor rights, social responsibility and sustainable supply chains.
“With this in mind, we, the undersigned nine textile and garment business associations of the STAR Network from six producing and export countries, hereby call on global brand companies, retailers and traders to:
- Carefully consider all potential impacts on workers, small businesses in the supply chain when taking significant purchasing decisions; honour the terms of purchasing contracts, fulfill obligations therein, and not re-negotiate price or payment terms;
- Take delivery or shipment, and proceed with payment as agreed upon for goods already produced and currently in production with materials ready, and not cancel orders which are already in production;
- Offer fair compensation to suppliers (100% FOB) if production or delivery has to be suspended or stopped, or offer salaries directly to workers of suppliers;
- Put no responsibility on suppliers for delay of delivery or shipment and claim no compensation for such delays;
- Put no further improper pressure on suppliers by additional costs, rush orders or unnecessary visits and audits;
- Make all efforts and engage with local stakeholders for a better understanding of the local situation and contexts;
- Always resort to dialogue and collaborative settlement to ensure mutually acceptable solutions to disputes;
- Support business partners on supply chain as much as possible, and aim at long-term strategy of business continuity, supply chain unity and social sustainability.
- “We appreciate the understanding, collaboration and support of our business partners and other stakeholders, and we are ready to work and walk with all responsible buyers globally to get through this crisis, towards a shared bright future.”
A number of high street retailers have cancelled orders with suppliers and are said to be delaying payments as stores around the world are forced to close as part of country-wide lockdown measures to try to stem the coronavirus outbreak.
New Look recently said it was halting supplier payments and new orders. A retail supplier engagement specialist, Solutions for Retail Brands (S4RB), warned the move could cause “irreparable damage to New Look’s supply chain,” and that its supplier relationships will take years to repair – if at all.
Prior to this, Primark was widely criticised for cancelling all orders with its suppliers after closing its stores on 22 March, but has now set up a fund to cover the wages component of orders that it canceled in Bangladesh, Cambodia, India, Myanmar, Pakistan, Sri Lanka, and Vietnam.
Meanwhile, Swedish retailer H&M has said it will pay and take delivery of goods already manufactured by its suppliers, as well as those in production, while Spanish fashion giant Inditex, which owns the Zara fashion chain, is to pay its Spanish workers their full salaries until 15 April – including those in its domestic factories.