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On 27 March, the Fair Wear Complaints Handler in North Macedonia received a call from the factory manager of one of Expresso's suppliers. The Factory manager claimed that there were several issues with Expresso's recent purchasing practices, occurring as a result of the COVID-19 crisis. The factory manager stated that he is concerned that without the payment of the invoice, he will not be able to pay the workers their salary for the month of March.
There are several issues that the factory manager is concerned about:
- The buyer has an outstanding invoice from January that has not been paid even though the agreed upon due date has passed. For the factory manager, this raises concerns in the ability for the factory to pay the workers' salaries this month. The final due date of the payment has expired but brand has not yet confirmed satisfactorily when they will pay the invoice. It is clear that the brand is suffering due to the COVID-19 crisis.
- According to the factory manager, Expresso told the factory that they cannot accept or pay for the order that has just been produced. The factory manager claimed that instead Expresso asked if the factory could keep these ready-made garment in their stock but did not provide information on what will happen with the finished products.
- According to the factory manager, Expresso asked the factory to buy input materials for new orders planned for May but have not provided written commitment that this order will be accepted and paid.
The factory manager would like Fair Wear's help to resolve this situation. The supplier would like to continue to have a good working relationship with Expresso.
Fair Wear addressed the complaint to Expresso within several working days. A meeting with Fair Wear and Expresso was organised and the issues raised were discussed. Expresso responded very quickly and proactively.
Through the investigation, Fair Wear was able to conclude the following:
- Expresso has been significantly impacted by the COVID-19 crisis and this led to the predicament in their regular business relationship with the supplier
- Expresso confirmed that the payment date of the invoice in question had indeed expired
- The same day the complaint was filed, Expresso verbally confirmed the payment and that they would pay the invoice in several instalments. However, the supplier needed to have it in writing before feeling secure
- Before Expresso had been informed about the complaint they had already paid the first instalment
- Expresso acknowledged that the communication with the supplier surrounding the issues listed in this complaint was not complete enough and does not adequately reflect the responsibility that they do feel as a brand. Expresso hopes to improve communication so that the supplier would feel comfortable to share such issues directly with them in the future.
- As the circumstances around Covid 19 disrupted Expresso's planning, Expresso has not yet clearly communicated with the supplier about orders and how they will proceed with their buying practices
Fair Wear asked Expresso to communicate openly with the supplier and to discuss what solution can be found that is workable for both parties.
Expresso and their supplier came to an agreement about how the invoice will be paid and a payment plan was shared in writing. The first instalment of the invoice was paid on 28 March, the second on 6 April and the third on 13 April. This was satisfactory for both parties.
Furthermore, Expresso explained to Fair Wear that they will try to improve the communication lines with the supplier.
In terms of the cancelled orders, Expresso is working on finding other opportunities to use them.
Fair Wear received an email from the supplier, who confirmed that Expresso had discussed the issue and that they have shared a payment plan for the outstanding invoice. The supplier furthermore confirmed that the first two instalments of the invoice have been paid in line with the payment plan.
The factory manager has confirmed that he considers the issue of the delayed in payments to be adequately addressed. Due to the timely payments of the instalments, the supplier feels confident that the Expresso will pay all further financial obligations. In terms of this complaint, Expresso acted very quickly and appropriately.