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Article

29 Jun 2020

Author:
Sushmita S. Preetha and Zyma Islam, The Daily Star

Bangladesh: 1931 brands have delayed & cancelled $3.7bn worth of orders from garment factories during COVID-19

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"Is foul play the new normal?", 26 June 2020

... [A]t least 1931 brands which have either delayed, put on hold, or straight up cancelled their orders since the onset of Covid-19, as per data received from the Bangladesh Garment Manufacturers and Exporters Association... The total value of these orders is around $3.7 billion... About 470 of the buyers are from the US, and approximately 280 others from the UK. Italy and Canada follow closely with approximately 180 and 170 buyers fully or partially cancelling or putting their orders on hold. Fifth and sixth in line are Germany and France...

An overwhelming majority are asking for massive discounts for products already produced or delaying payments by six months to a year, or worse, indefinitely. The brands which cancelled or postponed the highest volume of orders were: Primark, H&M, C&A, Marks & Spencer and Tesco... Primark tops the list with over $300 million worth of orders held up, postponed or cancelled...

[H&M and Inditex] have agreed to pay manufacturers for finished goods and goods in production... [but] a supplier requesting anonymity said that... "H&M has cancelled and put on hold orders over $1.5 million with us,"... [and] an official of Apex Spinning and Textile mills also said that Inditex straight up cancelled their orders with the group...Inditex's communications department... [said] they are standing by their commitments...

Suppliers are now also worried about future orders... All the brands we reached out to admitted that there would be likely be some reduction in future orders, given the depressed state of the market and unsold stocks of products from this season...

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