H&M to buy more garment items from Bangladesh: official
Swedish retail giant H&M will increase the volume of work orders for garment items from Bangladesh although the company is looking for alternative destinations for sourcing, a senior official of the company said.
“H&M has maintained good relations with Bangladesh over the last 30 years. We have a long-term plan for Bangladesh. So we will continue business with Bangladesh,” said Hendrik Heuermann, sustainability manager of H&M in Germany.
Heuermann shared his plan when a group of Bangladeshi journalists visited his Hamburg office in Germany on March 4.
H&M, the largest buyer for Bangladesh's clothing products, has recently started sourcing garment items from some new destinations such as Ethiopia and Myanmar. H&M purchases about $5 billion of garment products from Bangladesh a year.
The company will use Ethiopia and Myanmar as the sources of basic garment items as Bangladesh started producing value-added garment items like jackets, for upscale customers in the western world, he said.
However, he declined to comment on the quantity and prices of the apparel items the company sources from Bangladesh every year.
Germany is the second largest single export destination for Bangladesh's garment products after the United States. Some $4.38 billion worth of garment products were shipped to Germany in 2014-15, up 19.02 percent year-on-year.
He said the company has no plan to open any retail shop in Bangladesh in near future, although the retail giant opened some stores in India last year to meet the demand for middle-income customers.
H&M also plans to open stores in New Zealand, Puerto Rico and Cyprus this year as the company thinks those are its potential markets, the official also said.
He said Bangladesh is still a competitive country for producing garment items.
After the Rana Plaza building collapse in April in 2013, H&M has been facing criticism from the customers' end for sourcing garment items at cheap prices, although the global retailer did not buy garments from the factories housed in the Rana Plaza building.
Heuermann said his company has started a "fair wage method" in some garment factories in Bangladesh this year to help improve productivity and factory working conditions.
H&M plans to introduce the method in all of its sourcing factories by 2018 and hold dialogues between the employers and the employees to settle wage disputes, the company said in a statement a few months ago.
“The implementation of the method will contribute to sustainable pay structures, more regular wage adjustments and enhanced communication and social dialogue between the management and workers' representatives.”
H&M has more than 3,900 stores in 61 markets and buys around 80 percent of its products from Asia.
Bangladesh has become a popular sourcing country for H&M as the country has been enjoying zero-duty benefit to the EU since 1971 under the Everything But Arms scheme of the European Union.