H&M to Increase Unit Prices for Bangladesh Suppliers

Swedish fast fashion brand H&M will raise the price of garments produced in Bangladesh to compensate for higher wages for supplier workers.

According to Bloomberg, the company told the country’s garment factories that it will “absorb the increase of the wages in our product prices” following the Bangladesh government’s announcement that it will raise the minimum monthly wage for garment workers by 56% to 12,500 taka ($113) starting in December.

Protests erupted in Bangladesh late last month as garment workers demanded a nearly threefold increase in wages. Many people mobilized in the streets surrounding the capital city of Dhaka, sparking unrest.

The protests forced several factories to close, and police used tear gas and rubber bullets against protesters, leading to dangerous conditions; CNN reported that three workers were killed during the protests, one in a factory fire and one in a clash with police.

H&M’s Initiatives to Revise Supplier Wages

This is not the first time that H&M has revised wages and increased prices accordingly for its suppliers in Bangladesh. The company has revised minimum wages in the country and increased prices in 2013 and 2018.

H&M was also the “first” among the world’s major brands to settle all bills on all orders during the pandemic. Mostafiz Uddin, founder, and CEO of Bangladesh Apparel Exchange said that this proved a catalyst for other brands to follow and was crucial in enabling cash flow for thousands of suppliers around the world.

Bangladesh Sewing Workers’ Growing Discontent

Although the Bangladesh government appears to have partially heeded the demand, increasing wages by 56% to 12,500 taka ($113), many workers’ rights groups are not satisfied with the decision.

In October of this year, H&M and other retailers working in Bangladesh factories sent a letter to the country’s prime minister demanding that the government propose a minimum wage that covers the basic needs of workers. Similar demands have been made by the U.S. government, which has asked Bangladesh to reconsider the minimum wage and address the economic pressures faced by its workers.

In protesting the 12,500 taka ($113) wage increase, the garment workers argued that wage increases have not been on pace with inflation in the country over the past five years.

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