The financial instability of Australian fashion retailer Mosaic Brands has put thousands of garment workers in Bangladesh in a precarious situation.
The company defaulted on millions of dollars in payments to its suppliers, causing significant distress among employees in 23 factories, including Padma Satel Arab Fashions, reports Apparel Resources.
Padma Satel Arab Fashions, which employs 3,000 workers, has been awaiting $2.5 million in payments from Mosaic since June.
Factory director Jabed Ahmed revealed that despite ongoing requests for payment, Mosaic has advised them to continue production, promising payments would come soon, citing their declining sales as the reason for the delays.
In response to the crisis, suppliers are demanding a thorough investigation into Mosaic's financial management and insist that the retailer meet its financial obligations.
They argue that Mosaic's aggressive business strategies, particularly long payment terms, have contributed to the current financial turmoil.
Mosaic Brands entered voluntary administration in October, indicating severe financial challenges. The company is now undergoing a restructuring process, which may include measures such as asset liquidation or sales.
The future remains uncertain for the garment workers and suppliers affected, as the outcome of Mosaic's restructuring efforts is yet to be determined.
