Bloomberg News

Five Wal-Mart Vendors Made Clothes at Burned Bangladesh Factory

December 05, 2012

Five Wal-Mart Vendors Made Clothes at Burned Bangladesh Factory

A Bangladeshi Army personel walks through rows of burnt sewing machines after a fire in the nine-storey Tazreen factory outside of Dhaka, Bangladesh. Source: AFP/Getty Images

Wal-Mart Stores Inc. (WMT:US), which has acknowledged one of its suppliers used the Bangladesh factory where more than 100 people died in a Nov. 24 blaze, worked with at least five suppliers there this year, documents found in the ruins by a labor-rights group show.

Wal-Mart said the Tazreen Design Ltd. factory near Dhaka, Bangladesh’s capital, was no longer authorized to produce merchandise for the company and that it had cut ties with one supplier that kept using the facility. It’s not clear if any other suppliers continued to use the factory, which Wal-Mart had de-authorized before the blaze, the company said.

Purchase orders, shipment statements, inventory reports and other documents show that two New York-based suppliers for Wal- Mart and a third in California had sourced merchandise from Tazreen. Two companies in Bangladesh also manufactured apparel there for Wal-Mart, the records show. As recently as September, five of 14 production lines at the factory were making shirts and pajamas for Wal-Mart, an income report shows.

Kevin Gardner, a Wal-Mart spokesman, declined to discuss supplier relationships and to comment on whether additional suppliers to the company had used the factory.

There was a “period in 2012 where the factory was active,” though it was “de-authorized months before the fire,” Gardner said in a telephone interview today.

The Bangladesh Center for Worker Solidarity photographed the documents. The group passed them on to the Worker Rights Consortium, a labor-rights monitoring group based in Washington, which provided the documents to Bloomberg News. Suppliers cited in the documents include Topson Downs, of Culver City, California. That supplier subcontracted work to Bismillah Sourcing, a Bangladesh firm.

Faded Glory

Shorts branded Faded Glory, Wal-Mart’s private label, were sourced by Success Apparel of New York from the Tazreen factory, according to production reports dated in August. Success subcontracted to Simco Group, a handwritten note on the reports shows.

Various documents show Tazreen manufactured Khaki & Co. shorts for Wal-Mart’s Sam’s Club brand through a company called IDG. The reports include IDG’s “production order” forms from October 2011; a “fabrics inventory report” from February 2012, which lists Tazreen, IDG and the shorts’ style number all on one page; a “shipment status” report listing four IDG shipments of those shorts between February and March of 2012.

In a telephone interview today, Haynes Holding, the president of IDG, or International Direct Group, said his company had not used the Tazreen factory.

Told that documents show a direct connection between IDG and Tazreen, he said: “Maybe they took a bid. We have agents who handle aspects of the business.”

‘They’re There’

IDG workers “don’t sit in every factory all the time,” Holding said. “We’re in New York. They’re there.”

An employee of Topson Downs said yesterday a worker who deals directly with Wal-Mart would handle questions. She didn’t return that message or another seeking comment today. Moin U Ishaque, the New York contact for Bismillah Sourcing of Bangladesh, acknowledged and didn’t respond to a request for comment. Success Apparel and Simco couldn’t be reached.

The documents include an e-mail correspondence between a Wal-Mart buyer in Bentonville, Arkansas, and IDG highlighting the pressure the world’s largest retailer puts on its suppliers.

In a January e-mail, Wal-Mart assistant buyer Shelley Latham asks IDG for an early delivery of 266 pairs of its “Roll Tab Short” for a new Sam’s Club opening. IDG complied. The shorts, sold under the “Khaki & Co.” brand in such colors as “moon light” and “ebony black,” retail for $9.81.

A variety of purchase orders, shipment statements, inventory reports and other documents show that tens of thousands of pairs of Roll Tab shorts had been produced for IDG at Tazreen since at least the first quarter of 2012.

To contact the reporter on this story: Renee Dudley in New York at rdudley6@bloomberg.net

To contact the editor responsible for this story: Robin Ajello at rajello@bloomberg.net


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