Global Garment Manufacturers And Suppliers Lost Orders Of Up To 16.2 Billion US Dollars

?

CGWR and WRC pointed out that the main sources of the database of this report include clothing suppliers and their trade associations.

?

The report points out that since March, many large European and American fashion brands and companies cancelled their orders or refused to pay the orders placed before the epidemic, resulting in the losses of global garment factories and suppliers reaching 16.2 billion dollars in April and June. The report points out that suppliers from Bangladesh, Cambodia, Myanmar and other countries that have been hit have to reduce their business scale or even close their doors. Because of this, millions of workers are either directly laid off or forced to shorten their working hours.

?

The report points out that the epidemic has exposed the imbalance of rights at the core of the fashion industry, that is, the early production costs are borne by suppliers in economically underdeveloped and even poor countries, while buyers will pay only weeks or even months after the factory ships. Scott Nova, director of WRC and co-author of the report, pointed out: "During the epidemic, the original unfair payment system enabled western brands to support their financial situation by oppressing their suppliers in developing countries."

?

According to the report, although suppliers and workers are facing the crisis of life and death, some retailers still choose to spend millions of dollars to pay dividends to shareholders. In March this year, Kohl's, an American clothing retail giant, distributed a total dividend of 109 million dollars to shareholders a few weeks after cancelling large orders from factories in Bangladesh, South Korea and other countries.

?

The Garment Manufacturers Association of Cambodia released an open letter in April this year, calling on buyers to implement contracts to protect the livelihood of 750000 Cambodian garment industry workers. "All relevant stakeholders in the global clothing supply chain are overwhelmed by the epidemic, but compared with buyers, manufacturers (factories) have little profit and weaker pressure bearing capacity. Finally, workers who are already living on the food and clothing line have a more severe living environment."

?

The open letter also pointed out that the total value of the cancelled orders in Bangladesh was 2.5 billion pounds, and the buyers mainly included the spring and summer products of clothing retailers such as Arcadia (the parent company of Topshop), Debenhams, Asda, Peacocks, New Look and Sports Direct.

?

CGWR data shows that more than 1 million Bangladeshi garment workers have been laid off or temporarily dismissed due to the cancellation of orders or refusal to pay for goods by brands and retailers. Although the local government has provided a total of 500 million US dollars in aid to the factory to reduce the unemployment rate, many reports indicate that Bangladeshi workers have been without income for at least two months.

?

According to the report of Gorgeous Annals in July this year, Rubana Huq, president of Bangladesh Garment Manufacturers and Exporters Association, said that new orders were about 45% lower than the same period last year. Bangladesh is the world's second largest apparel producer, and the capacity utilization rate of its factories is only half of what it usually is.

?

Recruitment agencies of Vietnamese clothing enterprises are also facing difficulties. Vietnam is a major manufacturer of large sportswear brands such as Nike and Adidas. Recruitment consultant Will Tran told Reuters that he and his colleagues only signed two employment orders in April and May, and usually each person has as many as 10 orders. He said, "So 80~90% of the job demands disappear with a sound of" poof "."

?

Professor Mark Anna, director of CGWR and the main author of the report, pointed out that the financial situation of clothing companies had been impacted by the epidemic, but they must face their financial responsibilities. "Although being at the top of the supply chain allows (brands and retailers) to break contracts with suppliers in the face of crisis, the weak should be protected morally... The most basic thing is to ensure the rights and interests of workers at the bottom of the supply chain."

?

In order to urge brands and retailers to take responsibility, WRC and CGWR launched an "epidemic tracker" in April this year to monitor whether the company fulfills its contractual obligations. Arcadia Group, the parent company of British high street brand Topshop, Wal Mart, the American fashion retailer Urban Outfitters, and Mothercare, the British clothing retailer for mothers and babies, have not promised to pay the full price for completed and in production orders.

?

In addition, Scott Nova pointed out that under the influence of trade union organizations and media reports, Gap, H&M, Zara and other brands and retailers have announced that they will pay orders in full. Previously, Japanese fast fashion giant Uniqlo also said that it would pay for goods as usual during the epidemic.

The Center for Global Workers' Rights (CGWR/Global Workers' Rights Center) and the Workers' Rights Consortium (WRC/Workers' Rights Alliance) recently released an import data analysis report. Based on the previously undisclosed import database, these two American organizations estimated the losses of global garment factories and suppliers from April to June this year.