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H&M, Zara and Gap among brands found to be unfairly treating Bangladesh suppliers

By Rachel Douglass

Jan 9, 2023

Business

Bangladesh. Image: Pexels

A new report by Transform Trade has found a number of major high street fashion retailers to be paying and treating their Bangladeshi suppliers “unfairly”.

The likes of H&M, Gap, Next, Primark and Zara are among the brands named for paying factories below the cost of production.

Entitled ‘Impact of Global Clothing Retailers’ Unfair Practices on Bangladeshi Suppliers During Covid-19’, the report, which was funded by the University of Aberdeen, covered factories selling to 24 high-level retailers.

In the research, retailers were found to be paying their suppliers in the region the same prices almost two years on from the start of the pandemic, despite many facing rising costs in raw materials.

Additionally, nearly one in five were struggling to pay the 2 pound 30 pence a day minimum wage of Bangladesh, the second largest garment exporter in the world.

'This research is a wake-up call…'

While 90 percent of larger high street brands were said to be buying from four or more factories via “unfair purchasing practices” – as detailed in a survey carried out by the university and Fairtrade organisation – more than 50 percent of suppliers had reported experiencing such practices.

These included issues such as cancellations, failure to pay, delays in payment and discount demands.

Next to this, the survey further found that post-lockdown, garment factories had only employed 75 percent of the workers they had before, possibly hinting that up to 900,000 workers could have lost their jobs.

In a release, Fiona Good, senior policy advisor at Transform Trade, said: “This research is a wake-up call. When retailers treat suppliers badly by breaching previously arranged terms, it’s workers who suffer.

“If a retailer fails to pay the agreed amount, or delays payments, the supplier has to cut costs some other way, and this is frequently passed on to their workers, who have the least power in the supply chain.”

Good suggested the need for fashion watchdogs to get involved and stop the “unacceptable purchasing practices”, similar to the methods used to protect suppliers in the food industry.

She continued: “Only when suppliers are able to plan ahead, with confidence that they will earn as expected, can they deliver good working conditions for their workers.”

Gap
H&M
NEXT
Primark
Supply chain
ZARA