Swedish clothing manufacturer H&M is said to have told its suppliers in Bangladesh that it will increase its unit prices following the recently announced increase in minimum wages for garment workers in the region.
The company has assured its business partners in Bangladesh that it will stick to its responsible purchasing practices even after the introduction of the new minimum wage, an H&M spokesman replied to FashionUnited’s request, without specifically confirming the increased unit prices mentioned by various media.
“We have communicated to our suppliers that we recognize the importance of our purchasing practices in enabling better wage levels, better planning and forecasting, and favorable payment terms,” said H&M. “When setting the prices for our offering to customers, we always ensure that we offer the best combination of fashion, quality, price and sustainability in each market in which we operate.”
H&M addresses minimum wage increase
The Swedish clothing company reportedly said it would absorb the increase in wages in its product prices, making it among the first retailers to take this step as a result of the increased minimum wage in Bangladesh.
Earlier this month, the government of Bangladesh announced the new minimum wage for garment and textile workers. This is 12,500 taka (around 106 euros, 114 US dollars) and will apply to garment workers from December. The vast majority of workers in the textile industry in Bangladesh, many of whom work for suppliers to global fashion companies, have so far received monthly wages of around 8,300 taka (68 euros).
However, the protests and strikes in Bangladesh surrounding the minimum wage negotiations continued even after the increase. At first glance, the increase seems like a success, but the amount does not correspond to the demands of the unions and employees. Several workers’ rights organizations have since called for the decision and the minimum wage to be revised.