“The 11 factories, which are yet to receive their payments, have a total of over 10,000 workers in [sic] the payroll who were, through their tireless effort, involved in the manufacturing and delivery of the apparels in favour of Mosaic Brands.”

Three people in the industry who were not authorised to speak publicly told this masthead that more Bangladeshi suppliers would be complaining to the Bangladesh Garment Manufacturers & Exporters Association, which is preparing to submit a new letter to the Australian embassy, and the total amount owed by Mosaic to the suppliers is closer to $US15 million.

This masthead spoke with three suppliers who have worked with Mosaic and are owed money. The suppliers, who requested anonymity because of the confidential nature of the discussions, confirmed they had been asked to accept payment terms where they would be paid in instalments, which may take three years, and to accept a significant reduction in payment, known in the industry as “discounts”, for the amount they were owed.

“They [Mosaic] have asked many suppliers for 50 per cent and 70 per cent discounts,” said one supplier. “We are seeing how we can best help them ... but of course, we have our limitation. We will see what’s possible and what’s in the interest of everyone,” one supplier said.

The supplier added while the factories were being asked to accept significantly less than what they were owed, a bigger concern was whether Mosaic would pay the new amounts it was trying to negotiate. “How can we ensure and be certain they will honour this?”

Another supplier described Mosaic as a “predator” on Bangladeshi garment companies. “Hundreds of workers have been unemployed as a result of this,” the supplier said.

This supplier also confirmed Mosaic’s management had requested suppliers accept substantially smaller payments for the goods they had already delivered.

One supplier, who met Berchtold and Clarke as recently as last week, said there was next to no room for discussion. “Their approach is like, this is it. There’s no negotiation. We are in trouble,” said the supplier.

They were reportedly told by Berchtold: “I did not create this mess. I am just trying to restructure it and I can’t do more than this.”

The Bangladeshi suppliers said they had their own obligations to banks that needed to be fulfilled. “Our factory’s hands are also tied. It’s not like we can just agree with what [Mosaic] demands.”

Another supplier in China, who identified herself as Cayci from Ningbo Xifulai Garment Co Ltd, wrote two months ago on LinkedIn that her factory had been owed $US827,958 by Mosaic for two years. She asked: “Why don’t you pay me?”

Jane Cheng, general manager of NingBo Nice Baby Angel Garment Import And Export Co, also posted on LinkedIn three weeks ago, claiming to have been a supplier to Mosaic, and that she had been negotiating to receive payments for almost 14 months.

Mosaic lodged a notice with the ASX in late August stating that it would not meet the deadline to file its financial accounts, as it required more time to “resolve a number of matters” before the finalisation of its results. The company said it would file no later than September 30.

In August, the company had said it was seeking advice on options to refinance and restructure the company as it struggled to recover from a fall in consumer spending, a botched technology rollout and poor sales.

When approached for a comment, Mosaic said through a spokesperson: “We do not intend to engage in negotiation via the media, and we keep details of any discussions with all our commercial partners confidential.

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“The CEO and chair have repeatedly sought a meeting with the Bangladesh Garment Manufacturers & Exporters Association in recent weeks and would welcome any engagement with them.”

Mosaic is currently facing a lawsuit brought by the Australian Competition and Consumer Commission for allegedly failing to meet advertised delivery timeframes for several hundred thousand products that meant some customers paid for items that never arrived.

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