British superstore Asda have cancelled a quarter of orders with their clothing suppliers, saying they will only be issuing a partial payment for cancelled orders.
The superstore recently saw record food sales due to panic buying during Covid-19 crisis, but a spokesperson for the supermarket said that the pandemic had “had a significant impact” on the fashion industry.
It is alleged that the move has angered suppliers, as the range is still on sale.
One supplier said “ This type of behaviour is totally unacceptable”, adding that it is “ridiculous” for the firm not to pay for orders.
Asda says said that suppliers will be paid 30% of the order value for those that have not yet been finished, and half for those that have, within seven working days.
The move comes as the chain has seen a surge in demand for groceries and home deliveries as UK consumers are staying at home amid lockdown measures. They have said the focus has to be on “getting food onto our shelves for essential retail”.
The supermarket said that it had seen “severe downturn in the demand for clothing”,
Factory closures have also caused disruption.
Asda are not alone in this decision. Other retailers such as Primark and New Look have recently opted to cancel orders with their suppliers too.
Other brands including H&M and Zara have committed to pay in full for existing orders from clothing manufacturers.