Wal-Mart blocks shipment from a Bangladeshi firm
US retail giant Wal-Mart refuses to take shipment from a Bangladeshi exporter, which had a link with Tazreen Fashions where 112 workers died in a recent fire.
The Bangladeshi company, Simco Dresses Ltd, says it will face bankruptcy unless it is paid soon.
Simco got the work order through New York-based Success Apparel, which was a sourcing company for Wal-Mart, to make 336,000 pieces of women's shorts worth $1.2 million for the retailer.
Simco later subcontracted Tuba Group, the owning company of the controversial Tazreen Fashions, to ready a portion of the order through Tuba Fashions, which was known as a compliant factory. But Tuba Group shifted the order to Tazreen instead of Tuba Fashions without the knowledge of Simco.
Wal-Mart was aware of the deal between Success and Simco, but did not know about the subcontract with Tazreen.
After the fire, Wal-Mart severed ties with Success Apparel and blocked Simco's first shipment of 130,000 pieces worth $3.90 lakh, which by then reached the Los Angeles port.
Wal-Mart refused to receive the shipment after knowing Tazreen Fashions' involvement in the order.
Since then, Simco officials and leaders of the garment trade body, BGMEA, sent several letters to Wal-Mart and also met the officials of the retailer in Hong Kong. But they did not receive any positive response.
â€œIf Wal-Mart does not accept the shipment and clear the payment, I will not be able to bear the $1.2 million losses because my factory is small,â€ Muzaffar Siddique, managing director of Simco Dresses, told The Daily Star by phone. "My company will be bankrupt. I will not be able to pay the workers."
Siddique said he sent several letters to the Wal-Mart headquarters and met its high-ups in Hong Kong last month. "Even the BGMEA president also met the Wal-Mart officials,â€ Siddique said.
The Daily Star obtained the copies of all the letters sent to the Wal-Mart office.
If Wal-Mart now scraps the order, the impact will be huge, Shafiul Islam Mohiuddin, president of Bangladesh Garment Manufacturers and Exporters Association, mentioned in the letter sent on December 20.
â€œNearly 1,500 workers will lose jobs and this will cause social unrest and agitation,â€ Mohiuddin said.
However, Wal-Mart officials in Dhaka could be reached for comments despite repeated attempts.