Home Business EWM Group hits back at BGMEA’s blacklist threat, terms it ‘unproductive’

EWM Group hits back at BGMEA’s blacklist threat, terms it ‘unproductive’

by MD Samsuzzaman Siyam

British clothing retailer Edinburgh Woollen Mill (EWM) Group has hit back after the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) threatened to blacklist the company for not paying its suppliers in the country and not responding to the calls of the association, by terming their threat “unproductive”.

A spokesperson for EWM, however, insisted that the company has been engaging with suppliers with “the best of intentions”, reports inews.co.uk

“We are left with a very bitter taste in our mouth over the sincerity of this letter,” he said. “We think their approach has been unproductive and uncollaborative.”

EWM owns a number of brands including Bonmarche, Peacocks and Jaeger. Philip Edward Day, a Dubai-based British billionaire, is the CEO and owner of the Edinburgh Woollen Mill Group.

The company issued the response after BGMEA said, in a letter on Thursday, that EWM should stop asking for discounts, otherwise it would be blocked from placing future orders with its members.

EWM had not received the letter until after it had appeared in local media, a spokesperson for the company told inews.co.uk, adding that it was the first time the company had been contacted by the BGMEA.

The company had “positive” conversations with the vast majority of its suppliers, the EWM spokesperson said.

“They have understood that we are trying to find a balanced way forward that matches the immediate, urgent challenges faced by high-street stores nationally and those of suppliers,” he told inews.co.uk.

EWM is among several renowned brands that have entered negotiations with suppliers after the global shutdown due to coronavirus pandemic, according to the inews.co.uk report.

The company claimed that it had already paid for the majority of its future stock when Covid-19 pandemic hit, and is now talking to manufacturers about the remainder.

“We have looked at literally every option on the table and worked hand-in-hand with all our suppliers to find solutions, but we also need to recognise that these are difficult and complicated issues,” the EWM spokesman said.

“These are not simple problems, and every potential quick solution has long-term implications. If we took delivery of remaining unmade stock for the Spring season with all our stores closed, this stock would only be stored for next year and depress 2021 orders,” he said.

BGMEA said the EWM has so far cancelled work orders worth $8.22m (£6.76m) across five factories, adding that the company has reached agreements with suppliers on more than half of the total, with about $2-3m yet to be settled.

BGMEA President Rubana Huq said in her letter to EWM that certain buyers have been taking advantage of the situation to demand “unreasonable” discounts, which could be “financially catastrophic”.

“It will also expose our members to various claims and liabilities from regulations, banks and other third parties, which will eventually legally implicate the buyers themselves,” she said in the letter.

Huq said in the letter that some companies were also continuing to put pressure on suppliers to meet ethical targets, despite cancelling orders.

“There is a lot of discussion on sustainability, but sourcing practices are often not syncing with sustainability concerns,” the BGMEA president told The Daily Star earlier.

“For example, many buyers haven’t paid us but we have had their offices chasing us about salary and bonuses and whether those have been paid. This is not fair,” she said.

“So, we have to step up and take a stand and ensure that our terms of engagement with our buyers change for the better and that we end up with a more sustainable relationship with them.” Rubana Huq added.

However, EWM’s spokesman said the BGMEA was trying to “put media noise and tactics above engagement, discussion and solutions” in a bid to invalidate the “productive” discussion between the company and its suppliers in Bangladesh.

This is due to some BGMEA members having disagreed with the company’s approach, the EWM spokesman claimed.

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