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Banana Republic opens first store in London - but is accused of paying Indian workers just 15p an hour
Last updated at 15:52pm on 21.03.08
Mariella Frostrup at the opening of Banana Republic's flagship store in Regent Street
The opening today of an American fashion giant's first UK store looked as if it would be overshadowed by a demonstration about wages paid to Indian workers.
Banana Republic's three-storey shop, occupying 1,580 square metres in Regent Street, has been eagerly awaited.
The chain, owned by Gap, has enjoyed huge success in both America and Japan and it plans to open another four shops in the UK as part of its expansion into Europe.
However, it looked as though today's opening would be marred by a planned protest by the charity War on Want, which campaigns against poverty in developing countries.
Banana Republic, which is more expensive than Gap and is aimed at middle market shoppers who currently buy their clothes in stores such as Zara, had a turnover of more than £1.25billion from its 500 existing stores last year.
But War on Want claims garment workers in India making Banana Republic's clothes are being forced to work more than 70 hours a week for as little as 15p an hour.
John Hilary, the charity's campaigns director, told The Guardian today: “It reveals the high price workers in developing countries pay for our fashion. Time and again we have seen examples like this exposed while retailers fail to ensure decent pay and conditions.”
Kirsty Young is a fan of Banana Republic clothes, aimed at middle market shoppers
Banana Republic said it would investigate the claims but added that the factories around the world, which it did not own, were checked regularly to ensure suppliers complied with the company's ethical code.
The chain had a turnover of more than £1.25bn last year
Dan Henkle, Gap's senior vicepresident of social responsibility, said: “We have launched an immediate investigation into the allegations... we are looking at the factories in that area, where production on our clothing is done, factories which also do work for a number of other retailers, and plan to take appropriate action.”
Banana Republic, a major prespresence in the US, will be well known to an increasing number of Britons who make transatlantic shopping trips to take advantage of the weak dollar.
On its website, the retailer describes itself as “American style inspired by the very best of the creativity and culture that surrounds us”.
It goes on: “Now we have arrived in London with a new flagship store in Regent Street, our first on this side of the pond, we cordially invite you to join the republic.”
It's not thought the invitation applies to War on Want's protesters.
Reader views (2)
Unfortunately 15p doesn't equate to much out in India. The exchange is is about £1=85 rupees and although India is a considered as developing country, decent food and basic clothes are just as expensive. Also, the average size of a family is lot larger than in the west, therefore, they have more mouths to feed and with fewer lower end jobs available they will work for anything to keep their children and families alive.
Stores like Banana Republic mark their prices up by as little as 40% when they open a branch in the UK so it would only be fair some of that dramatic profit is shared with those lower down in the company. This mark up rate is ridiculous especially when considering the geographical location, the UK is closer to India than America so the shipping distance would less, hence the overall costs would be less. In logical sense this should have resulted in the costs being less (to sell in one store here than the 499 stores all the way in America) so even if an equivalent pricing structure was developed rather than marking the price up by 40% the workers could still be paid a more decent rate, rather than lining the MD's with larger bonus's for not being able to do basic math.
- Sabrina, London UK
Whilst 15p an hour does sound like an obscene wage what does 15p translate into in the local currency and what does it buy in the local economy? Perhaps this is actually the going rate over there. Remember too that we still have rogue bosses over here who pay well below the basic minimum and who are very adept at conning their workers out of their hard earned pittances by making it compulsory for them to live in company accommodation etc.
- Dennis, Taplow. U.K.
