Local apparel sector has started bearing the brunt of the ongoing coronavirus outbreak, as some buyers, especially those from the affected countries, are gradually cancelling their import orders, industry people said. Some 20 factories have faced cancellation of work orders amounting to at least US$17 million, while orders worth more than $1.0 million have been withheld in recent days, informed sources said. The European Union (EU) and the US are the major destinations for locally produced ready-made garment (RMG) items. Buyers mostly from the EU communicated with local suppliers about their latest decisions on order cancellation, and deferred shipments, they added. Italy, Spain, France and many US cities have already enforced a complete lockdown to limit further spreading of the COVID-19. According to global reports, Primark and Inditex shut their stores in the coronavirus-affected EU countries. Besides, major retailers in North America, like – Nike, Under Armour, Lululemon Athletica, Lands End, Columbia Sportswear and Gap, have already announced that they would shut down stores or reduce store hours for all locations in the US and Canada. Local exporters expressed the fear of facing further blow to export to the US, as retailers started closing down stores there. “On Tuesday, I received cancellation of work orders of 2.1 million pieces, placed for April onward,” a manufacturer told the FE. Another factory owner said his EU-based buyer has cancelled work order worth $1.0 million. Being partners of the global supply chain, both buyers and suppliers have to consider the overall situation. They have to come to a win-win situation, taking into account interests of both workers and consumers, he added. When asked, Dr Rubana Huq, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said they received information from a good number of member factories about cancellation of orders worth over $10 million. Buyers are taking information about production, and asking local suppliers to hold off cutting fabric. Those who have already produced items are being asked to hold shipments, as global consumption is coming to a halt, she also said. With the global shutdown now affecting the business of brands and retailers, more than 4.0 million local RMG workers are facing an uncertain time. “Buyers and retailers have long been focusing on fair labour practices and human rights here. Now they are unilaterally imposing decisions of order cancellation and postponement on us.” The buyers are considering only their business aspects, while it is the issue of survival for local RMG makers. They have to pay monthly wages to workers and bear other utility costs, irrespective of whether shipments are made or not, she noted. Md Hatem, senior vice president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said the rapidly changing global outbreak scenario has created serious uncertainties for local exporters. Md Hatem added that his buyer has asked him to defer the purchase order for at least 30 days.
