Clothing Business – RN Squared http://rnsquared.com/ Sun, 27 Jun 2021 19:40:58 +0000 en-US hourly 1 https://wordpress.org/?v=5.7.2 https://rnsquared.com/wp-content/uploads/2021/06/icon-8-150x150.png Clothing Business – RN Squared http://rnsquared.com/ 32 32 When fashion thinks about reshoring, take a look at what “Made in USA” means https://rnsquared.com/when-fashion-thinks-about-reshoring-take-a-look-at-what-made-in-usa-means/ https://rnsquared.com/when-fashion-thinks-about-reshoring-take-a-look-at-what-made-in-usa-means/#respond Thu, 17 Jun 2021 02:07:55 +0000 https://rnsquared.com/when-fashion-thinks-about-reshoring-take-a-look-at-what-made-in-usa-means/ For the past few decades, companies have focused on maximizing efficiency. In order to reduce costs, accelerate production and become more efficient, manufacturers have concentrated their activities on suppliers in a few countries. “These global supply chains resulted in savings and increased profits when everything went smoothly, according to scientists Stéphane Girod and Natalia Olynec […]]]>

For the past few decades, companies have focused on maximizing efficiency. In order to reduce costs, accelerate production and become more efficient, manufacturers have concentrated their activities on suppliers in a few countries. “These global supply chains resulted in savings and increased profits when everything went smoothly, according to scientists Stéphane Girod and Natalia Olynec of the International Institute for Management Development. “But the disruption from the COVID-19 pandemic was immense,” as more than 90 percent of the clothing sold in the US, for example, is made internationally.

With about 40 percent of clothing purchased in the US came from China, brands and retailers in the US and other Western markets suffered significant delays in manufacturing and distribution when the first wave of COVID-19 forced factories in China to close for weeks . Such far-reaching disruptions have led companies to think about redesigning the logistics of their supply chains.

In April, a survey conducted by the accounting firm EY found that up to 83 percent of multinational executives are considering “reshoring” – or in other words, moving production back to their home countries after outsourcing. In a report evaluating the impact of COVID-19 on the manufacturing, sourcing and supplier identification platform ThomasNet found a similar focus on reshoring, which showed two in three (69 percent) manufacturing companies are moving manufacturing to North America in July (compared with 54 percent in February).

The potential for a surge in reshoring efforts in the U.S. (and beyond) would prove remarkable for companies in the fashion industry. While some well-known names are already producing in the USA, the domestic fashion industry largely relies on internationally outsourced clothing and accessories. With this in mind, relocating back to the US would lead to greater emphasis on the specifics of the “Made in USA” label, an area that is likely to be subject to increased attention and enforcement.

In short, the Federal Trade Commission (“FTC”) prohibits marketers from including unqualified “Made in USA” claims (ie, full representations without express restrictions) on labels unless: 1) the final assembly or processing of the product takes place in the USA, 2) all essential processing that goes into the product takes place in the USA, and 3) all or virtually all of the ingredients or components in the product are made and sourced in the USA

Hardly any unresolved issue: “False and misleading claims ‘Made in USA’ have been a mainstay of FTC enforcement for many years,” so Frankfurt Kurnit Klein & Selz PCs Jeff Greenbaum, who notes that the government agency’s announcement in June 2020 that it is considering codifying its rule that companies market a product as “all or virtually all” from the United States should substantiate such claims. (Codifying this standard would allow the FTC to apply for increased penalties related to false claims “Made in USA”.)

Most recently, the FTC hit the headlines in December when it handed a record $ 1.2 million judgment on Alpharetta, Georgia, adhesive giant Chemence for selling adhesive products with “Made in the USA” claims and American flag images sold and third parties that their wholesale products were made wholly or almost entirely in the United States when foreign materials accounted for more than 80 percent of the cost of materials and more than half of the total cost of the products to manufacture.

In a 2016 order, the FTC requested that Chemence not claim that its products were made in the US unless they could demonstrate that all significant US processing, final assembly or processing in the US, and all or virtually all ingredients have taken place or components of the product have been manufactured and sourced in the USA or otherwise contain “clear and conspicuous identification” about the inclusion (and extent of use) of foreign parts. Despite this order, Clemence and his President James Cooke continued to sell adhesive products labeled “Made in USA” using the same ingredients from overseas with no language appropriate.

The resulting $ 1.2 million fine is evidence that the FTC knows that “many customers who want to support the domestic industry look for” American Made “claims or symbols.” pro Keller and Heckman LLPs Sheila Millar and Jean-Cyril Walker and that companies that violate labeling regulations will have “significant consequences” as the FTC continues to aggressively pursue “Made in USA” claims.

In one case that comes a little closer (for fashion brands), the FTC took action against Shinola in 2016 for marketing their watches as “built” in Detroit. While final assembly of the company’s clocks took place at its headquarters in Detroit, Michigan, the company’s clocks were made entirely of foreign parts, according to the FTC. In connection with the matter, Shinola agreed to include language to alert consumers that while his watches are “built in Detroit”, they are made “from Swiss and imported parts.” The company also agreed to abandon the “Where American is Made” tagline.

(Like Truth in Advertising, Inc. in a reflection on the matter, the Shinola case left some interesting questions unanswered. Including: implicit indications of origin resulting from a brand name. “By focusing on straightforward, explicit claims like ‘built’ in Detroit, the FTC may have overlooked less obvious, implicit claims that convey the same message.” In other words, TINA claims, “Shinola can tell consumers that its watches are made in Detroit” – or of American origin – “without saying that its watches are” built “in Detroit because there are only so many conclusions which you can pull from a watch with the words “Shinola” and “Detroit” in close proximity to each other on the dial. “)

Given the content of the “Made in USA” plan released by President-elect Joe Biden, it is expected that the emphasis on labeling will be a priority for the new administration. In the plan released in September 2020, Biden states that he intends to end “false advertising” regarding “Made in USA” claims by cracking down on “companies that label products as Made in America, even if they are come from China or elsewhere. “Given that phrase, Greenbaum says that” It seems pretty clear that enforcement of fraudulent ‘Made in USA’ claims will only increase. “

Against this background, companies, including those from the fashion industry, are encouraged to refresh the various labeling rules – the difference between the country of origin rules for customs and border control and the “Made in USA” of the FTC. Guide to California Law on U.S. Origin Claims. Millar and Walker note that “Companies wishing to promote their products as American products would be well advised to familiarize themselves with the FTCs.” US Origin Claims Enforcement Policy Statement Instructions to prevent your “Made in USA” claims from being stuck together. ”

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“We had to tear up the entire business plan and leave” https://rnsquared.com/we-had-to-tear-up-the-entire-business-plan-and-leave/ https://rnsquared.com/we-had-to-tear-up-the-entire-business-plan-and-leave/#respond Thu, 17 Jun 2021 02:07:55 +0000 https://rnsquared.com/we-had-to-tear-up-the-entire-business-plan-and-leave/ Opening of the Drapers Digital Festival, the market leading event for online fashion retail and e-commerce, taking place today and tomorrow (Join Now be there live free) described Beighton how Covid-19 forced Asos to abandon its existing business plan and rethink the future. “We had to rethink where the organization should go. We realized we […]]]>

Opening of the Drapers Digital Festival, the market leading event for online fashion retail and e-commerce, taking place today and tomorrow (Join Now be there live free) described Beighton how Covid-19 forced Asos to abandon its existing business plan and rethink the future.

“We had to rethink where the organization should go. We realized we needed to get more digital – which may sound strange from a Pureplay retailer, but we needed to get more digital in all of our processes. We have already worked on digitizing our customization process and speeding it up so that fewer physical samples move around in different locations.

“We had to be more connected to our customers and become more agile. We have canceled or relocated nightlife equipment worth around half a billion pounds and introduced significantly more casual wear – we “We had to completely switch from one category to the other.”

Beighton predicted that the coronavirus crisis will increase consumer interest in sustainability: “Sustainability is a big thing and it is only getting bigger. In the near future, there will be a tipping point where customers will organize their spending according to sustainability principles. This will be a pivotal year on this journey: 2020 will bring back thoughts on ethics, values, what customers really need, who made their garments, and whether those people were treated right. “

Asos unveiled a 29-piece circular fashion collection earlier this week that follows eight sustainability principles and has held conferences with suppliers to help them improve sourcing and sustainability standards.

“I’ve told our partners that transparency is key,” said Beighton. “Transparency is inconvenient, but it enables control and change. Sustainability doesn’t shape most of our customers’ shopping habits right now, but we focus on this topic because we see it right and because we make predictions.There will be a tipping point, and when that tipping point comes our customers will no longer have to choose what Buy them sustainably from Asos because we did this hard work for them. “

Strong product

Casual wear, activewear and beauty products were the key categories that performed strongly for Asos in the lockdown – a trend Beighton expects to evolve over the long term as consumers face a holiday season with no parties and events under coronavirus restrictions.

“If we look at the next six months, which are among the most important times of the year for retail, consumer behavior is usually determined by parties and events. Asos is known for going out – we’re famous for that – but evening wear or tailoring sales haven’t increased since the restrictions were lifted. Lockdown categories are still developing very strongly. It’s going to be a very restless three months for online and offline retail. “

The Asos boss also expects the pandemic to disrupt Black Friday and Christmas for the main street.

“Boxing Day and Black Friday will be very difficult to manage for brick and mortar stores, as social distance and queues will have to be avoided. There could also be a problem with product supply as many factories were closed at one time and the products weren’t made for Black Friday. I think we will see the Christmas sales season brought forward. “

To sign up for the second day of the Drapers Digital Festival and hear from retailers like Very Group and BeautyPie, Click here.

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COVID-19 is causing multi-billion dollar bills in the fashion industry https://rnsquared.com/covid-19-is-causing-multi-billion-dollar-bills-in-the-fashion-industry/ https://rnsquared.com/covid-19-is-causing-multi-billion-dollar-bills-in-the-fashion-industry/#respond Thu, 17 Jun 2021 02:07:55 +0000 https://rnsquared.com/covid-19-is-causing-multi-billion-dollar-bills-in-the-fashion-industry/ The fashion industry has long been under fire for human rights abuses. But the COVID-19 crisis sheds new light on these abuses. Without a system that enables consumers to hold businesses accountable, the abuse will continue. Nicky is a writer and speaker who mainly deals with arts and culture. This is a split opinion. The […]]]>
  • The fashion industry has long been under fire for human rights abuses.
  • But the COVID-19 crisis sheds new light on these abuses.
  • Without a system that enables consumers to hold businesses accountable, the abuse will continue.
  • Nicky is a writer and speaker who mainly deals with arts and culture.
  • This is a split opinion. The thoughts expressed are those of the author.
  • Visit the Business Insider homepage for more stories.

The fashion industry has long been the focus of human rights activists. Child labor, pexcessive wages, and a lack of transparency means that textile workers – especially in the global south – are consistently exploited.

The same applies to environmental concerns: The fashion industry is responsible for 10% of the CO2 emissions of mankind, 35% of all microplastics in the sea and 85% of all textiles produced annually end up in landfills. With statistics like this, it is clear that the fashion industry will have to wait a long time to settle accounts.

COVID-19 is this billing.

Fashionably late

In April, The guard reported that major fashion brands including Primark and Matalan had canceled or suspended orders for £ 2.4 billion worth of clothing from factories in Bangladesh. Over 97% of suppliers surveyed by WRC and Penn State University said brands “did not offer financial assistance” to cover vacation or severance pay; the WRC Executive Director described the situation as “wholesale abandonment of workers and suppliers” by brands.

Are factory owners who operate with low profit margins and have no access to cash reserves or credit unable to pay their workers – who do not earn enough themselves to amass the savings they need to survive this pandemic. While brands strive to minimize losses, factory owners and workers in Bangladesh face poverty.

Closer to home, the brands ASOS and Boohoo both made headlines over unsanitary working conditions in their UK factories, which directly led to COVID-19 outbreaks in both locations. Boohoo, in particular, has been criticized for allegedly paying workers from € 3.50 per hour at a factory in Leicester – less than half the UK legal minimum wage of £ 8.72 an hour. Though Boohoo said the factory was subcontracted and the bran didn’t investigate their supply chain, sales were booming by that point and bosses were lining up to earn £ 150 million in bonuses.

ASOS meanwhile 70 workers laid off at the beginning of the outbreak when they switched delivery supplier (from Menzies to DPD). The administrators and drivers were originally informed that their contracts would be transferred just so that DPD would honor its commitment and announce their dismissal on May 1st.

A new light on abuse

Whether in the UK or beyond, the impact COVID-19 is having on the fashion industry is unmistakable. As the crisis has unfolded it has exposed many of the systemic problems in the industry – unclear supply chains, worker exploitation and extreme waste to name a few – but we still have to find sustainable solutions to these problems.

Initiatives like Mallzee’s Lost Stock were born to fill the void left by brands leaving their suppliers. Consumers can purchase a tailored bag of clothing from Lost Stock for £ 35 – a 50% discount off the estimated retail price of £ 70. Lost Stock website claims that each bag supports a Bangladeshi worker and his family for a week.

While an innovative solution to the dual problem of helping workers and reducing waste, initiatives like this speak to our neoliberal, late capitalist era by making consumers responsible for solving the deep-seated problems in the fashion industry. While brands continue to benefit from the exploitation of their workers, the burden of “doing the right thing” and saving these workers rests on individuals – many of whom are themselves suffering from COVID-related layoffs and short-time work.

Also, when calling on individuals to help end systemic problems, initiatives like this require the public to make difficult personal decisions about what is important to them as they are asked to split their disposable income between causes – BLM, local Boards, queer fundraisers, etc. The focus is on individual consumers making ethical decisions for the common good rather than holding brands accountable.

Mallzee’s program appeals to consumer self-interest: it is undeniably positive that the garments are not wasted, but the 50% discount speaks for a world where we are primarily consumers; where everything is transactional and a good deed comes with a material reward. It’s also worth noting that the focus on poverty and exploitation in other countries is leading Western consumers to buy the lie that this “doesn’t happen here” and is doing the vulnerable, precarious and exploited workers in our home countries a disservice.

accountability

At a time when we should reflect on our relationship with fast fashion and our place in a deeply consumer-centric society, the response to COVID-19 seems to be a focus on more consumption. Instead of the # BoycottAsos campaign which emerged in response to the treatment of its workers by ASOS, ASOS doubled: in the week before the pubs reopened in England, ASOS offered UK buyers discounts to prepare for Super Saturday. In doing so, they encouraged the public to see themselves as consumers and used the reopening of pubs and bars as an opportunity to boost sales – although the public health advice remained clear to stay home and avoid unnecessary travel.

In all of these cases, it is the responsibility of the individual consumer to make ethical choices while we need the accountability of businesses and governments. The COVID-19 crisis has shed light on everything wrong with fast fashion: cramped, unsanitary working conditions, precarious and exploitative employment, an opaque supply chain that allows brands to abandon their workers.

It is clear that real systemic change is required and that encouraging consumers to behave “ethically” will not be enough. Without organized collective action and a system that enables us to hold brands accountable, these problems will continue under our noses.

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How fashion companies abandoned RMG employees in Bangladesh https://rnsquared.com/how-fashion-companies-abandoned-rmg-employees-in-bangladesh/ https://rnsquared.com/how-fashion-companies-abandoned-rmg-employees-in-bangladesh/#respond Thu, 17 Jun 2021 02:07:55 +0000 https://rnsquared.com/how-fashion-companies-abandoned-rmg-employees-in-bangladesh/ It is time the big buyers were held accountable In Bangladesh, 50 takas is not bad for overtime. So Kulsum always works as much as possible. She is a textile worker at Sams Attire, a factory in Dhaka where the company C&A produces shirts, pants, dresses and T-shirts. Kulsum’s wages are just enough for a […]]]>

It is time the big buyers were held accountable

In Bangladesh, 50 takas is not bad for overtime.

So Kulsum always works as much as possible. She is a textile worker at Sams Attire, a factory in Dhaka where the company C&A produces shirts, pants, dresses and T-shirts.

Kulsum’s wages are just enough for a room in a barrack near the factory and for the two children’s school fees. “My husband drives a rickshaw,” says the 28-year-old. “We can only buy our groceries with his wages.”

Cofra Holding has its headquarters in Zug, Switzerland, 7,000 kilometers from Dhaka. She manages the assets of the Brenninkmeijer family, who founded C&A almost 200 years ago and controls the international textile group. With an estimated fortune of CHF 15 billion, the Brenninkmeijers are the eighth richest family in Switzerland, according to the Swiss magazine “Bilanz”. C&A does not publish figures, family businesses do not have to.

But the industry knows that C & A’s sales have been shrinking for years. Discounters like Aldi, KiK, Primark and Lidl sell fashion even cheaper, chains like Zara and H&M are attracting more and more customers. In 2018 the Brenninkmeijers were looking for a buyer for their group – unsuccessfully.

Then came the pandemic

Then came the coronavirus: C&A had to close all 1,400 branches in Europe for weeks.

On March 23, shortly after the outbreak of the pandemic, Martijn van der Zee, number two at C&A, wrote to suppliers in Bangladesh: “These are extraordinary times that call for the extraordinary […] Measures that put the strength of our partnerships to the test. ”In other words: C&A cancels all orders up to the end of June“ with immediate effect ”, regardless of the production status. Even garments that have already been sewn remain in the warehouses.

C&A is not the only apparel company that is abruptly withdrawing large orders in Bangladesh and other countries. A data set collected by the BGMEA shows for the first time how various fashion chains have behaved. It lists 7,854 canceled or postponed orders from the fashion industry, including those from Switzerland. The table is a snapshot of a disaster in late March.

C&A alone is said to have canceled orders worth $ 166 million. Swedish company H&M reportedly canceled orders worth $ 178 million. The Swiss fashion chain Tally Weijl is said to have initially suspended orders worth $ 7 million and canceled orders worth around $ 3 million. At the end of June, Tally Weijl himself speaks of cancellations amounting to $ 2.17 million. “In the meantime, all of these suspended orders are in production, on the way or have already arrived.”

In total, orders worth $ 3.2 billion have been canceled or suspended – one tenth of Bangladesh’s annual textile exports. The country ships around $ 35 billion worth of clothing every year, with 84% of its exports being T-shirts, dresses and men’s suits, the top export.

When we reached Kulsum on her cell phone at the beginning of April, she was sitting at home with her husband and children. At the end of March, the government issued a “national holiday”. Kulsum lost her job and her husband no longer deserves a single taka. The landlord demands money every day. Kulsum is afraid that he might throw her family out of the room. “If this continues, it will be very, very difficult,” she says. “If you are poor you have to die.”

Thousands of women textile workers take to the streets in mid-April. Some are demanding their wages, others reopening their factories, and others demanding that their factory remain closed for fear of coronavirus infection. Dozens of demonstrators are injured and two women are said to have been killed. Although Prime Minister Sheikh Hasina pledged Tk 500 billion to support the textile industry at the end of March, the government had not yet kept her promise and payments were slow.

The fashion chains’ stopping orders is responsible for the chaos. “Almost all governments have paralyzed public life”, argues C&A – so nothing can be sold in stores for “weeks, if not months”.

The calculation is simple: no sales, no sales, no money for the suppliers. They could not expect the group to “keep and / or fulfill the contracts” – writes C&A to the suppliers in Bangladesh, referring to German law. It allows the suspension or cancellation of orders in cases of force majeure.

Lawyers like Alan Behr, a New Yorker specializing in the fashion industry, are critical of this. The reference to force majeure could be unjustified, “since most force majeure clauses do not cite pandemics as a reason for non-payment,” he says. Ultimately, a court must decide on this.

The power rests with the customers

It is questionable whether this will ever happen. Because the orders are vital for the suppliers: “Many will not defend themselves against the fashion companies,” says Christie Miedema of the Clean Clothes Campaign, the non-governmental organization that campaigns for the rights of textile workers.

When providers annoy major customers like C&A, they simply move like a caravan to the next country to look for even cheaper accommodation.

The power is in the west. Companies like C&A draft the contracts and terminate them. An example of this are the general terms and conditions of C&A. The group allows itself to reduce supplier invoices by up to 12%. C&A grants itself a “4.5% discount” if the company pays the invoice within 10 days. “It reads like this for me: We take a 4.5% discount on everything,” says an industry expert.

A further 7.5% can be deducted if “a different product is delivered or fewer goods than ordered”. According to industry experts, the fact that a manufacturer has to deliver an exact amount is “a tough nut to crack, a hard contract”. Buyers typically accept between 2-3% more or fewer items of clothing.

Manufacturers in Bangladesh pay raw materials and wages in advance, try to meet tight delivery times and in the end only a small profit remains. But better a bad order than none at all. This is why seamstresses earn so badly – and they have to meet ever more stringent requirements. Fashion companies push suppliers financially until they “have great incentives to cut costs through exploitation,” according to NGO Human Rights Watch.

In Bangladesh, the manufacturers opted for an unusual path in their plight: They publicly denounced the methods of their customers and asked them to pay off their outstanding debts. “Our situation is apocalyptic,” said Rubana Huq in March. As president of the textile industry in Bangladesh, she claims to represent over 4 million women textile workers.

“The canceled and suspended orders from western fashion houses bring us to the brink of ruin.”

When the media reported on the grievances in Bangladesh in April, C&A Purchasing Manager Martijn van der Zee asked the suppliers for understanding: “We know that you were shocked by our first letter […]. We too were hit hard and at that time we had no choice but to take drastic measures immediately. ”

C&A would pay for the goods that have already been shipped and take over most of the clothes ordered. On April 23, the company announced through Cofra Holding that 93% of the canceled orders had been resumed. C&A does not want to say to which production countries and to which period the number referred.

A supplier in Bangladesh said at the beginning of May: “C&A is still placing orders today.” And his factory hardly receives any new orders. At the beginning of May, after questioning its members, the Bangladesh Textile Industry Association came to the conclusion that C&A definitely wants to cancel 40% of its orders, 20% in December and the remaining 40% next year.

Open for a fee

After weeks of only eating lentils with rice crackers, Kulsum found out on May 1 that she could go back to work the next day. “Finally,” she says, “I was so excited about the reopening of the factory that I cooked my husband’s favorite dish – lentil soup, aubergine puree, spinach and rice.”

The Sam’s Attire factory has up to 6,000 textile workers, 600 to 700 per floor. The factory was almost fully occupied from the start, although only 30% of the workers are admitted. “It’s difficult to keep your distance,” says Kulsum.

In mid-May she will receive almost 60% of her April salary. It was financed with state money and the factories have to repay the loan at 2% interest. C&A urges governments and banks to “speed up access to credit and income support for businesses and workers”.

The factories are running again, but a lot of money is still lacking in Bangladesh. Scott Nova of the US NGO Worker Rights Consortium is someone who talks about this more openly than the suppliers. He assumes that C&A has reactivated around 90% of the orders.

This means that the company is better positioned than others. But the problem is not solved. “Conservatively, there is a gap of $ 20 to 30 million,” says Nova. C&A funds were missing $ 2-3 million in wages today, the equivalent of 20,000 to 30,000 textile workers a month.

The fact that textile companies want to postpone orders by up to a year is tantamount to a rejection. “How can the company guarantee that it will take off and pay for the clothes a year later?” Asks Nova, an employment lawyer.

In addition, fabrics and clothing have to be stored, otherwise they would go moldy in the high humidity in Bangladesh. His conclusion: “When millions of dollars are missing, the industry needs time to recover from the financial hangover. Suppliers have to close their factories and lay off workers. The wages are falling, the families have no money for food and rent. ”

A spokesman for C&A said: “Complete production of all old orders is not possible and unreasonable, as production in many supplier countries was completely interrupted for several weeks and can currently only be restarted to a limited extent to protect factory workers.”

At the beginning of June, Rubana Huq spoke publicly for the first time about the extent of the crisis: “Only 1,926 factories have started working again.” The association has 4,500 factories as members. The capacity utilization is only 55%. In addition, orders had been canceled and $ 430 million was missing to pay the garment workers’ wages. Around every second job in the textile industry is at risk.

Huq warns: “We are blacklisting companies that do not pay and do not react to their suppliers.” And for the first time, individual providers are threatening to bring lawsuits against buyers.

Dil Afrose Jahan is a freelance investigative journalist and media trainer. Benedict Wermter is a reporter from Germany, Sylke Gruhnwald and Christian Zeier are reporters from Switzerland. The investigation was published and written for the first time in cooperation with the Swiss investigation platform “Reflekt”. The investigation is partially funded by the European Journalism Covid 19 Support Fund. Further information and background material at www.reflekt.ch/bangladesh.

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UPDATE 1-Italy’s OVS stops doing business with Myanmar suppliers who discriminate against workers https://rnsquared.com/update-1-italys-ovs-stops-doing-business-with-myanmar-suppliers-who-discriminate-against-workers/ https://rnsquared.com/update-1-italys-ovs-stops-doing-business-with-myanmar-suppliers-who-discriminate-against-workers/#respond Thu, 17 Jun 2021 02:07:55 +0000 https://rnsquared.com/update-1-italys-ovs-stops-doing-business-with-myanmar-suppliers-who-discriminate-against-workers/ (Adds details, quotes and background) ROME, March 15 (Reuters) – Italian clothing retailer OVS said Monday it would maintain its “limited presence” in Myanmar but stop doing business with suppliers who discriminate against workers involved in rallies against the country’s junta are. “Given the modest size of current production (in Myanmar), OVS could easily leave […]]]>

(Adds details, quotes and background)

ROME, March 15 (Reuters) – Italian clothing retailer OVS said Monday it would maintain its “limited presence” in Myanmar but stop doing business with suppliers who discriminate against workers involved in rallies against the country’s junta are.

“Given the modest size of current production (in Myanmar), OVS could easily leave the country but will maintain its limited presence,” the group said in a statement.

The company didn’t say how much business it had with suppliers in Myanmar.

“(OVS) will cease all activities with suppliers who discriminate against workers involved in protests,” she added.

Myanmar is known worldwide for its yarns, fabrics and textile products, and its apparel industry is an important source of jobs.

OVS said it condemns human rights violations in Myanmar and will monitor the situation in the country where violence has increased following the overthrow of Aung San Suu Kyi’s government last month.

Sweden’s H&M, the world’s second largest fashion retailer, and Italy’s Benetton announced last week the immediate suspension of new orders from Myanmar.

Myanmar security forces shot at pro-democracy protesters and killed six people on Monday, media and witnesses said, a day after dozens of protesters shot dead and attackers set fire to several China-funded factories in Yangon city. (Reporting by Giulia Segreti; Editing by Jason Neely)

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Opinion | How can a piece of clothing be cheaper than a sandwich? https://rnsquared.com/opinion-how-can-a-piece-of-clothing-be-cheaper-than-a-sandwich/ https://rnsquared.com/opinion-how-can-a-piece-of-clothing-be-cheaper-than-a-sandwich/#respond Thu, 17 Jun 2021 02:07:55 +0000 https://rnsquared.com/opinion-how-can-a-piece-of-clothing-be-cheaper-than-a-sandwich/ Several clothing factories in Leicester stayed open during the pandemic regardless of social distancing measures, according to Labor Behind the Label, a nonprofit advocating for workers’ rights; Some employees said they should go to work even if they tested positive for Covid-19. Overall, the outlook for low paid workers is bleak as the world battles […]]]>

Several clothing factories in Leicester stayed open during the pandemic regardless of social distancing measures, according to Labor Behind the Label, a nonprofit advocating for workers’ rights; Some employees said they should go to work even if they tested positive for Covid-19.

Overall, the outlook for low paid workers is bleak as the world battles a deadly disease. A study by researchers at Imperial College London shows that in low and middle income countries Poor people are much more likely to die of Covid-19 than wealthy people. In the United States, the economic effects of the pandemic were worst for low-income adults.

In 2016, the Dutch trend researcher Li Edelkoort asked at Voices, a meeting of fashion innovators organized by The Business of Fashion: “How is it possible that a piece of clothing is cheaper than a sandwich? How can a product that has to be sown, grown, harvested, combed, spun, knitted, cut and sewn, refined, printed, labeled, packaged and transported cost a few euros? “

A question that has preoccupied me ever since.

The cotton, textile and clothing industries were associated with Labor exploitation long before Covid-19 exposed the putrefaction. The fashion industry has long been complicit in a system of paying people below subsistence wages in order to maximize profit. This business model, which focuses on selling mountains of clothing at intrinsically intolerable prices, has paid back less and less to those who make them.

Take Bangladesh, where four million women textile workers live. Many of them earn little more than the government-mandated minimum wage: just 8,000 taka or less than $ 100 a month. Fair wage activists say double that amount would be needed for workers to live comfortably.

Even the most sublime fashion brands participate in the exploitation of the most vulnerable workers in their supply chains. Luxury labels like Dior and Saint Laurent often turn to subcontractors in India to produce intricate embroidery and embellishments at a lower cost. The highly skilled craftsmen who are hired get little credit or money for their work. In fact, some rental companies often do the final assembly of the garments in Europe and mistakenly label them as “Made in Italy” or “Made in France”.

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Supreme does not want an unaffiliated trademark to be able to register the “EMERPUS” trademark https://rnsquared.com/supreme-does-not-want-an-unaffiliated-trademark-to-be-able-to-register-the-emerpus-trademark/ https://rnsquared.com/supreme-does-not-want-an-unaffiliated-trademark-to-be-able-to-register-the-emerpus-trademark/#respond Thu, 17 Jun 2021 02:07:55 +0000 https://rnsquared.com/supreme-does-not-want-an-unaffiliated-trademark-to-be-able-to-register-the-emerpus-trademark/ Simply reverse the order of the letters in the word “Supreme”, slap that made-up word on clothing, and then file a trademark application for registration with the US Patent and Trademark Office (“USPTO”)? This will land you on the other side of an objection procedure VF Corp.’s own streetwear brand, Supreme. After all, that’s what […]]]>

Simply reverse the order of the letters in the word “Supreme”, slap that made-up word on clothing, and then file a trademark application for registration with the US Patent and Trademark Office (“USPTO”)? This will land you on the other side of an objection procedure VF Corp.’s own streetwear brand, Supreme. After all, that’s what has happened since Canadian company Urban Coolab Inc. filed a trademark application for “EMERPUS” for use in clothing and retail stores in May 2020.

in the an objection procedure The legal advisor initiated in January for Supremes Chapter 4 Corp. argued that Urban Coolab’s application should be blocked by the USPTO’s Trademark Trial and Appeal Board because “EMERPUS” is not an indicator of the origin of the Canadian apparel brand’s products. Instead it is “just” [Chapter 4’s] SUPREME wordmark written backwards “, which Urban Coolab uses to” associate ” [its] Goods and services with [Chapter 4’s] well-known brand SUPREME ”, an argument which is substantiated in Chapter 4 by pointing out that Supreme has used its own brand in a similar way, adorning its coveted merchandise with an upside down version of its. famous box logo.

In relation to its “exclusive federal and common law rights to the ‘SUPREME’ marks” for which it “owns” Hundreds of trademark registrations worldwide“, Chapter 4 claimed that it had used the marks” at least since April 1994 “when” the first Supreme retail store opened “. [and] offered a variety of clothing, bags and related products and accessories “with the name Supreme and the red and white rectangular logo. As for the “fame” associated with the “SUPREME” brands, Chapter 4 pointed out: (1) Its “consistent and exclusive use of the [marks] for the past 25 years in the United States and around the world including in connection with apparel, bags, accessories, skateboard decks, streetwear-related products, and other merchandise; (2) unsolicited media attention to the Supreme brand; and (3) hundreds of millions of dollars in Supreme branded merchandise worldwide. ”

With the foregoing in mind, and because of Chapter 4’s “extensive use of the SUPREME trademarks” – from the word mark to the red and white box logo – Chapter 4 claimed that these trademarks had become “famous and an asset of considerable value.” [Chapter 4] symbolizing [the Supreme brand], its quality goods and services, and its goodwill. ”Hence, the company has argued that if Urban Coolab is“ eligible to obtain registration for ” [the EMERPUS] Mark ”, the“ damage and injury [Supreme’s] Business reputation and goodwill and would hurt and impair [its] Senior rights in the ‘SUPREME’ brands. ”

In addition to “dilute”[ing] the unmistakable quality of the SUPREME brands, which were already available before the filing date of [Urban Coolab’s] Application or an alleged date of commercial use of [Urban Coolab’s] Brand ”, as the brand“ EMERPUS ”was“ so similar ”to the SUPREME brands in Chapter 4, the group stated that it was likely to cause confusion among consumers. In other words, Urban Coolab’s use of the “EMERPUS” mark on clothing and accessories will “create the mistaken impression that” [its] Goods and services come from [Supreme] or that [its] The goods and services are authorized, licensed or endorsed by, or are in any way affiliated with or connected with [Chapter 4] or the “SUPREME markings” if not.

As such, Chapter 4 claimed that its opposition should be upheld and that Urban Coolab’s trademark should be denied.

In the response it filed last month, Urban Coolab denied Chapter 4 claims, denied that registering the “EMERPUS” brand would damage the streetwear company and its corporate arm, and also denied the Chapter 4 claim that it is used the “EMERPUS” mark in order to increase the attractiveness of the Supreme brand despite the similar characters and the similar stylizations of the characters. (While Urban Coolab’s application states that its “trademark is made up of standard characters with no specific font style, size, or color,” it still has the word “EMERPUS” in white block letters in a rectangular red box, reflecting that Appearance of The Supreme box logo). The brand also raises a number of objections, including that “no likelihood of confusion, error or deception” is involved.

In the preliminary rationale of his case, Urban Coolab requested that the Trademark Trial and Appeal Board (“TTAB”) bias reject the Chapter 4 objection and “give it any further relief that may be appropriate”.

Fast forward to March 1st and Chapter 4 has requested the Trademark Authority to temporarily suspend the process, telling TTAB that “the parties are actively negotiating the settlement of this matter” and has requested that “this process” take place for 30 days suspended so the parties can pursue their settlement efforts. ”In a motion dated the same day, TTAB granted Chapter 4’s motion to suspend the matter“ subject to the right of either party to request a retrial at any time ”.

UPDATED (April 7, 2021): Following Chapter 4’s motion dated March 1 to stay proceedings on the basis that “the parties are actively involved in negotiating the settlement of this matter,” Urban Coolab’s attorney filed his application for registration on April 6 from EREMPUS. Maintaining the objection and rejecting the application, the TTAB ended the action on April 7th.

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Garment workers in Myanmar urge global brands to reject the coup https://rnsquared.com/garment-workers-in-myanmar-urge-global-brands-to-reject-the-coup/ https://rnsquared.com/garment-workers-in-myanmar-urge-global-brands-to-reject-the-coup/#respond Thu, 17 Jun 2021 02:07:55 +0000 https://rnsquared.com/garment-workers-in-myanmar-urge-global-brands-to-reject-the-coup/ NEW YORK (AP) – Tin Tin Wei worked eleven hours a day, six days a week, sewing jackets in a factory in Myanmar. But she hasn’t sewed a single item of clothing since a coup in February. Instead, the 26-year-old union organizer protested on the street – and tried to put international pressure on the […]]]>

NEW YORK (AP) – Tin Tin Wei worked eleven hours a day, six days a week, sewing jackets in a factory in Myanmar. But she hasn’t sewed a single item of clothing since a coup in February.

Instead, the 26-year-old union organizer protested on the street – and tried to put international pressure on the newly installed junta.

Her union, the Myanmar Garment Workers’ Association, and others have held general strikes to protest the coup and are calling on major international brands such as H&M and Mango, which source some of their products in Myanmar, to denounce the takeover and apply more pressure to factories to protect workers from being laid off or harassed – or worse, because they participated in the protests.

“If we go back to work and work for the system, our future will be in the dark and we will lose our labor rights and even our human rights,” said Tin Tin Wei, who has worked in a clothing factory for many years 13.

The response from companies has so far been mixed. Few have announced plans to curtail their business in Myanmar. Most of the others have made no-action statements saying that while they denounce the coup, they want to support the workers by providing them with jobs.

The Tin Tin Wei union and the Confederation of Trade Unions in Myanmar are also calling for extensive international sanctions – not the targeted sanctions some have imposed – to overthrow the junta that toppled the civilian government of Aung San Suu Kyi.

When international sanctions were dropped in the mid-2010s, when Myanmar began moving towards democracy and setting some labor standards after decades of military rule, Western brands looking to diversify their sourcing were drawn to the country’s cheap labor force. Broad sanctions would now paralyze this burgeoning clothing industry, which has grown rapidly in the last few years before the coronavirus pandemic, cutting orders and cutting jobs.

Widespread sanctions could destroy the livelihoods of more than 600,000 textile workers, but some union leaders say they would rather see massive layoffs than endure military repression.

“I have to make a sacrifice for our next generation in the short term and long term,” said Tin Tin Wei, the sole breadwinner in her family who receives food donations.

The civil disobedience movement, or CDM, has included railroad workers, truck drivers, hospitals, bank clerks, and many others determined to stifle the economy.

The goal is “no participation in the junta at all,” said Sein Htay, a migrant labor organizer who had returned to Myanmar from Thailand. “We believe CDM really works, so we are motivated to keep going.”

But the violent raids by Myanmar security forces on demonstrators, including textile workers, are escalating. troops shot dead at least 38 people on Sunday in an industrial suburb of Yangon – an area dominated by clothing factories – after Chinese-owned factories were set on fire. Tens of thousands of workers and their families fled the area in the days that followed.

The apparel industry plays a key role in Myanmar’s economy, particularly in the export sector. About a third of Myanmar’s total merchandising exports were textiles and apparel, valued at $ 4.59 billion in 2018. That’s an increase of 9%, or $ 900 million in 2012, when international sanctions were lifted according to the latest data from the European Chamber of Commerce in Myanmar.

Due to favorable trade agreements, Myanmar’s clothing exports are mainly to the European Union, Japan and South Korea. The US accounts for 5.5% of Myanmar’s exports, with clothes, shoes and luggage making up the majority of that, according to clothing trade expert Sheng Lu.

But Myanmar still has a tiny share – less than 0.1% – of the total supply networks of fashion companies in the US and the European Union. And there are plenty of other alternatives for brands.

Even so, many adopt a wait and see attitude when it comes to long-term decisions. Experts note that it is not easy to move products to another country, nor is it easy to return to Myanmar once companies leave. In addition, some argue that Western companies play a role in reducing poverty by providing opportunities for workers in Myanmar to earn income while helping to improve labor standards there.

Working conditions in the factories were already poor before the February coup, but the unions had made some moves and given workers hope. And while the National League for Democracy, the party that was ousted in the takeover, didn’t proactively protect the unions, it didn’t persecute them or crack down on them, says Andrew Tillett-Saks, a union organizer in Southeast Asia who previously served Based in Myanmar.

Asian brands have remained calm about the turmoil so far. The American Apparel & Footwear Association, along with other groups such as the Fair Labor Association, condemned the coup and urged members to honor existing financial contracts with the factories there.

Steve Smith, CEO of LL Bean, said he was saddened by the situation in Myanmar, which he visited in 2019. Bean uses multiple factories and suppliers for three product lines.

Smith said there is backup production elsewhere, but it is important not to let the country down.

Other companies have reacted more strongly. Hennes & Mauritz and The Benetton Group, for example, have suspended all new orders from factories in Myanmar.

“Although we are not taking immediate action regarding our long-term presence in the country, we stopped placing new orders with our suppliers at this point,” H&M said in a statement. “This is due to our concern for people’s safety and an unpredictable situation that is limiting our ability to operate in the country.”

Spanish brand Mango said it will work with its trade and union partners around the world and locally in Myanmar to ensure there is no retaliation against factory workers or union leaders who are exercising their civil or union rights.

Moe Sandar Myint, chairman of the Myanmar Garment Workers’ Association, which organized small strikes on factory floors that later took to the streets, said brands are not doing enough to help workers. She wants to see “concrete action”.

Nearly 70% of the garment factories in Myanmar are owned by foreigners, according to the European Chamber of Commerce in Myanmar, and a good portion of that is Chinese-owned. International brands that use the factories do not hire workers directly, often depending on a network of contractors and subcontractors to manufacture goods for them.

But companies have “tremendous influence in the industry,” said Tillett-Saks. “You have complete power over the supplier.”

Tin Tin Wei says the escalating military intimidation has frightened some workers at her factory. It is located in the Hlaing Thayar industrial area and was unionized five years ago. Of the 900 workers employed in the factory, 700 initially joined the protests, but that number dropped to 500 by early March, she said.

Moe Sandar Myint, who goes into hiding and moving from one safe house to another after police raided her home in early February, said she would continue fighting.

“I cannot allow my generation and my next generation to live under a different military leadership,” she said. “This is unacceptable.”

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The brand activists and nonprofits deal directly with fashion policy – WWD https://rnsquared.com/the-brand-activists-and-nonprofits-deal-directly-with-fashion-policy-wwd/ https://rnsquared.com/the-brand-activists-and-nonprofits-deal-directly-with-fashion-policy-wwd/#respond Thu, 17 Jun 2021 02:07:55 +0000 https://rnsquared.com/the-brand-activists-and-nonprofits-deal-directly-with-fashion-policy-wwd/ Hottest in lately Fashion it’s not fashion at all – it’s politics. Last week brands, sustainable fashion experts, editors and nonprofits came together to draft a letter to the president Joe Biden – touched by the Zeitgeist piece by a journalist Call for senior fashion policy advisor. As fashion spans sectors, governments, and borders, the […]]]>

Hottest in lately Fashion it’s not fashion at all – it’s politics.

Last week brands, sustainable fashion experts, editors and nonprofits came together to draft a letter to the president Joe Biden – touched by the Zeitgeist piece by a journalist Call for senior fashion policy advisor. As fashion spans sectors, governments, and borders, the implications for work, health and safety, trade, pollution, domestic production, and supply chain transparency are far-reaching. And brands are committed to political reform in a concrete way.

The up-and-coming Swedish-American label Amendi was one of the first to sign the letter.

“As soon as we started [Amendi] we asked, “How do we enforce the law?” said Corey Page Spencer, co-founder of the brand. “I was looking for lawyers who could get involved in sustainability law. Not much attention is paid to it. “

But that can change if the collective weight of the Allbirds, Reformation, Everlane, ThredUp, and more is any indication.

Grassroots Efforts for Updated “Green Guides”

Long before he co-founded Amendi, Spencer was a bright-eyed student of literature and poetry, first at New York University and later at Columbia University. When he later moved into the fashion industry, it was his time at the organic denim label Nudie Jeans that gave him the feeling of arrogant practicality that he would carry into his own label and give up for free.

“Nobody made organic denim in 2001,” said Spencer, noting that the brand had shown that “fashion could be a way,” as evidence of a transition from organic food to organic clothing.

Amendi was founded in 2020 and aims to expand access to information in the luxury sector. Every garment has a “Fabrication Facts” label supported by certifications such as the Global Organic Textile Standard or Global Recycled Standard, and a “fully traceable supply chain” that customers can view in a customized online module. The brand’s website features resources such as “Fashion Needs Legislation” and a comment written by Spencer entitled, “Can Poetry Cure the Climate Crisis?” (Poetry, he argued, is a climate fear coping mechanism.)

And what about the legislation? Together Amendi and Hilary Jochmans – the sustainable one Fashion Lawyer leading efforts to get the fashion tsar’s letter on Biden’s desk urge PoliticallyInFashion, an initiative by Jochmans to bring fashion into sustainable politics (a ground that is still a bit untrodden).

First on PoliticallyInFashion’s agenda is the update of the US Federal Trade Commission’s Green Guides, launched in 1992 to ensure businesses avoid making misleading environmental claims to consumers, and has not been updated since 2012. The group has determined that they does not reflect the current consumer landscape. As they exist today, there are no regulations governing sustainability claims and “organic” or “natural” claims (other than what is covered by the US Department of Agriculture’s National Organic Program). There is now a growing sense of Consumers distrust of brand sustainability claims in the midst of rampant greenwashing.

“Everyone says they are sustainable,” said Spencer. “Greenwashing is a tool for traditional exploitation of the way the fashion industry works.”

In recent months, both the German government and the European Parliament have proposed laws that would hold companies accountable for effects along their supply chains. The European Commission is also fighting against greenwashing and is publishing new data that shows that many fashion companies are guilty of false advertising. Up to 42 percent of the 344 allegations examined used exaggerated, false or misleading terms that could potentially be considered unfair business practices under EU rules, the Commission found.

While Jochmans believes the recent executive orders are timely, as the US rejoins the Paris Agreement to send a “strong message,” she doesn’t see any major political changes in the US – at least not yet.

“No, I don’t see sustainability as defined” [this year], and that may not be a bad thing, ”said Jochmans. However, she wants “guard rails” to delimit what is sustainability and what is not. “I think you will see more leadership from the administration when it comes to moving this conversation forward. As far as the legislation is passed, it is still 50-50 [split in the Senate]. So I don’t know if we will see laws. “

Still, she is optimistic that private sector initiatives will gain momentum as political discourse becomes more authentic in fashion.

“We saw how many brands were involved in the ‘Get out the vote’ movement … Now the work begins,” said Jochmans.

Global movements towards microplastics, waste

Adidas has partnered with Parlay for the Oceans to recycle plastic waste.

From well-known names like Adidas to new activewear labels like Girlfriend Collective, brands are pushing for recycled plastic. A popular source material is post-consumer waste in the form of plastic bottles and fishing nets. The only problem is whether it is recycled or not, the microfiber peeling is unhindered.

In October, the United Nations, together with companies and NGOs, re-examined the potential of a new international agreement on plastics in a joint report entitled “The Business Case for a UN Treaty on Plastic Pollution”. The call-to-action was signed by P&G, Unilever and the H&M Group.

Surf lifestyle brand Fair Harbor believes its existence will be strengthened by reducing plastic waste – of which it will be recycling 9 million plastic bottles by the end of 2021. The company welcomes government intervention to accompany this mission where its own efforts are insufficient.

“Although we haven’t read the contract, we fully comply with all government measures to reduce our carbon footprint and hold people accountable for their individual actions,” said a spokesman for the Fair Harbor brand. “We are building a responsible company – from the products we develop to our business growth and corporate culture – and we support all efforts to motivate others to be responsible for their own actions.”

Efforts were made in February by both nonprofits and government agencies to crack down on plastics in fashion. A report titled “Fossil Fashion: The Hidden Reliance of Fashion on Fossil Fuels” by the nonprofit Changing Markets Foundation estimates that the market share of the material due to the increasing use of synthetic fibers in the industry (especially in fast fashion markets) of 69 percent to 73 percent within the next 10 years – polyester is expected to make up 85 percent of that.

Regardless of this, attention to textile waste is gaining momentum at the grassroots level. In January the US Public Interest Research Group launched a national campaign to raise awareness of textile waste. In the weeks since then, the organizers have launched state campaigns and got the industry talking. PIRG expects to publish its first report in April highlighting the brands’ fraudulent practices, such as disguising garbage incineration in reports as “Waste to Energy”.

Olivia Sullivan, Zero Waste Associate at US PIRG and the main campaign contact, said, “We are definitely open to discussion [with the fashion industry]but in the end it is too big a problem to leave it to the brands to do something voluntarily. “

Founded by Lauren Fay, the New Fashion Initiative is another nonprofit that focuses on getting brands and consumers involved in fashion policy.

Last summer, TNFI launched a weekly political education series on its Instagram platform, a year after forming a group called the Fashion Waste Policy Alliance. The group includes the textile recycler FabScrap, the Fashion Law Institute and the Model Alliance.

“We’re currently focused on highlighting laws that are relevant to sustainable fashion, from current labor, chemical and disposal laws to proposals for clothing taxes or a fashion tsar,” said Fay. “Our goal is to show the role of legislation for a sustainable fashion system and to highlight current legal loopholes.”

Can textile concepts come into play?

While fashion wants to rebuild itself, sustainability resonates in all facets, with companies wanting to see the big picture.

When Rebecca Burgess founded Fibershed in 2010, she set out to build a concept wardrobe with everything – including dyes, fibers, and labor – all within 150 miles, a concept that was later tested by The North Face four years later. Now, in 2021, the brand is regenerative again (and it is not alone).

“I realize that brands have to work before competition. This also means that we need a coalition of brands to be on the same side in order to construct these new realities even for themselves. So on the private market side we need more cooperation, for example to nominate cotton from one location, ”said Burgess of Fibershed’s efforts to convert conventional acreage not just to organic certification, but to a completely different approach to land management. This approach protects soil biology and builds up soil carbon – “things that are organic” [agriculture] doesn’t do it in itself. “

“This is a project that is going on, I’ll be able to tell more about it soon, but it’s called C4 – The California Cotton and Climate Initiative, and these brands are right now deciding how much intake they can handle – right in the middle of what’s pre-competitive Look like pounds, ”said Burgess.

She believes that fashion has tried to rule itself to its detriment.

“If Biden comes up with the Build Back Better or if Tom Steyer [chair of California’s Economic Recovery Task Force] is brought in by [California Gov.] Gavin Newsom, to build better in California, the cornerstone for me is that you would surgically look for the toughest part of the economy that will create the biggest economic multiplier and that would be manufacturing, “Burgess said. “This is the delta that we have in textiles in the US We have a few manufacturing facilities, but to get this right we need textile districts all over the US. “

For more information, see:

Allbirds, ThredUp, More ask Biden to appoint “Fashion Czar”

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Myanmar crisis rings the death bell for clothing industry, jobs and hope https://rnsquared.com/myanmar-crisis-rings-the-death-bell-for-clothing-industry-jobs-and-hope/ https://rnsquared.com/myanmar-crisis-rings-the-death-bell-for-clothing-industry-jobs-and-hope/#respond Thu, 17 Jun 2021 02:07:55 +0000 https://rnsquared.com/myanmar-crisis-rings-the-death-bell-for-clothing-industry-jobs-and-hope/ (Corrected to 86,000 kyat in paragraph 25) FILE PHOTO: Workers iron and organize clothes in a textile factory in the Hlaing Taryar industrial area in Yangon, March 10, 2010. REUTERS / Soe Zeya Tun / File Photo (Reuters) -Two years after opening his garment factory in Myanmar, Li Dongliang is on the verge of closing […]]]>

(Corrected to 86,000 kyat in paragraph 25)

FILE PHOTO: Workers iron and organize clothes in a textile factory in the Hlaing Taryar industrial area in Yangon, March 10, 2010. REUTERS / Soe Zeya Tun / File Photo

(Reuters) -Two years after opening his garment factory in Myanmar, Li Dongliang is on the verge of closing and firing his remaining 800 workers.

The business struggled over the COVID-19 pandemic, but orders were suspended following a February 1 coup that sparked mass protests and a deadly raid that set its factory on fire amid a wave of anti-Chinese sentiment.

Its story exemplifies the dangerous situation of a sector vital to Myanmar’s economy that, according to the UN, accounts for a third of its exports and employs 700,000 low-income workers.

“We would have no choice but to give up Myanmar if there are no new orders in the next few months,” Li said, adding that he has operated at around 20% capacity and only survived from pre-coup orders to 400 Employees cut.

Li said he and many of his colleagues are considering moving to other low-cost clothing hubs like China, Cambodia or Vietnam as major fashion brands like H&M and Primark stopped trading with Myanmar due to the coup.

According to the Myanmar Garment Manufacturers Association, by far the largest group of investors, Chinese nationals like Li fund almost a third of the 600 garment factories in Myanmar.

At least two other clothing factories financed by China in Myanmar with a total of 3,000 employees have decided to close, said Khin May Htway, managing partner of the MyanWei Consulting Group, which advises Chinese investors in Myanmar. She said the two companies are her customers but declined to identify them citing privacy protection.

Foreign investment in clothing has increased in Myanmar over the past decade as economic reforms, the end of Western sanctions and trade deals helped establish the sector as the greatest symbol of its burgeoning development as a manufacturing center.

According to UN Comtrade data, garment shipments in Myanmar increased from less than $ 1 billion in 2011, which is about 10% of exports, to more than $ 6.5 billion in 2019, which is about 30% of the Exports.

However, the sector was rocked by the pandemic that plunged the world into recession and stifled consumer demand, causing tens of thousands of jobs to be lost at a clothing factory in Myanmar and elsewhere in Asia.

Then the coup happened.

In the weeks that followed, many textile workers joined the protests or were unable to work as the streets became battlefields. The turmoil has also stalled the banking system and made it difficult to get goods in and out of the country, factory owners said.

Amid mounting international condemnation for the coup, European and US fashion brands issued a statement last month through their associations saying they would protect jobs and uphold commitments in Myanmar.

However, many have recently placed orders there, including the world’s second largest fashion retailer, H&M from Sweden, Next and Primark from the UK, and Benetton from Italy.

Next said it would split its orders that previously went to Myanmar between Bangladesh, Cambodia and China, while Benetton said it would mainly move business to China. H&M and Primark have not commented on how they will redistribute orders.

Escape from poverty

In Vietnam, textile mill owner Ravi Chunilal told Reuters that he was starting to get more business from European buyers branching out from Myanmar.

“They don’t want to abandon Myanmar … but it’s being forced on them,” said Peter McAllister of the Ethical Trade Initiative, a labor rights organization that also includes European high street brands.

McAllister said it would be very difficult for the clothing sector in Myanmar to recover if Chinese investors got out.

Anti-China sentiment has risen since the coup, with opponents of the Beijing takeover taking note of subdued criticism compared to Western condemnation. Against this backdrop, several China-funded factories, including Li’s, were set on fire by unknown attackers during a protest last month.

Human rights groups have repeatedly raised concerns about exploitation in the clothing sector in Myanmar, where most women workers earn only 4,800 kyat ($ 3.40) a day, the lowest in the region.

But it has enabled many to escape poverty as rural workers have migrated to factories, mainly around the Yangon commercial center, and sent money back to their families.

Khin Maung Aye, general manager of the Lat War garment factory, which employs 3,500 people, says the sector is on the verge of collapse unless the military re-establishes a democratically elected government.

That would lead to “dire consequences of poverty,” he said, adding that he was staying afloat with orders placed before the coup, but feared that orders for the next season, which is usually later in due this month would dry up.

Thin Thin, a 21-year-old textile worker, said her family of five survived on a monthly wage of 86,000 kyat ($ 59) her factory gave her while it was closed because of the coup.

“I feel so stressed out … We have nothing more to mortgage. We have to borrow from moneylenders at 20% interest a month. “

The United States, which has imposed targeted sanctions on Myanmar’s military, suspended trade talks with Myanmar late last month, saying that it is reviewing its eligibility for its Generalized System of Preferences, which cuts tariffs and offers other trade benefits for developing countries.

This could mean “a future disruption” for the Myanmar apparel sector, said Steve Lamar, president of the American Apparel & Footwear Association, which represents more than 1,000 fashion brands.

However, some unions representing women textile workers have called for the international community to impose tougher sanctions to put pressure on the military, even if this could further harm their industry.

“I accept exit orders,” said Myo Myo Aye, founder of the Solidarity Trade Union of Myanmar, through a translator. “The workers would face difficulties and hardships because there were no jobs. On the other hand, we simply do not accept the military regime. “

($ 1 = 1,400,000,000 kyat)

Reporting by Chen Lin and John Geddie; Additional reporting by James Pearson in Hanoi, Victoria Waldersee in Lisbon and Elisa Anzolin in Milan; Editing by Robert Birsel

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