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Small relief for garment exporters as Primark agrees to take all orders

  • Published at 09:19 pm November 4th, 2020
Primark UK
Customers wearing face masks enter a Primark store as it is reopening following the coronavirus disease (Covid-19) outbreak, on Oxford Street in London, Britain, June 15, 2020 Reuters

The British retail giant informed its Bangladeshi suppliers in an email on November 2

Primark, one of the ten largest buyers of garment products from Bangladesh, has pledged to honour all the orders placed even though the UK, its most important market, has entered into another round of lockdown from this month.

The British retail giant informed its Bangladeshi suppliers in an email on November 2. 

Currently, about 107 suppliers in Bangladesh supply products to Primark.  

All Primark stores in the UK, Ireland, France, Belgium, Catalonia in Spain and Slovenia -- which amounts to more than 57 per cent of its total retail selling space -- would be temporarily shut this month.

The discount fashion chain warned that the latest round of enforced closures to muffle the second wave of coronavirus cases would cost it about £375 million of lost sales. 

“We are implementing the operational plans developed to manage the consequences of these closures and appropriate action will be taken to reduce operating costs. All orders placed with our suppliers will be honoured,” Primark said in an announcement on November 2.

Primark’s gesture could be viewed as a sigh of relief for the country’s garment exporters, which are on the edge in light of the emerging second wave of Covid-19 cases in the EU and the US, the two most important export destinations.

Also Read: Primark sets up fund for RMG workers after order cancellations

Overseas shipments raked in $2.9 billion in October, down about 4% from a year earlier, in what can be viewed as the harbinger of the cold, harsh winter that lies ahead for Bangladesh’s exports.

Garment, which fetches more than 84 per cent of the export receipts, brought home $2.3 billion in October, down 8 per cent year-on-year.

“Since we have fought through the first wave together and unfortunately we are finding ourselves facing the second wave, we sincerely believe brands will be much more matured and empathetic in their action and commitments this time,” said Rubana Huq, president of the Bangladesh Garment Manufacturers and Exporters Association, welcomed Primark’s gesture.

Global apparel retailers cancelled work orders worth about $3.2 billion soon after the pandemic took root. They also delayed shipment and payment of delivered goods.

“The first wave of Covid-19 brought a lot of uncertainties and challenges. Despite the initial knee-jerking reactions, most of the brands later came to acceptable terms in terms of payments,” she added.