Walmart (WMT) is done selling Welspun India’s Egyptian cotton sheets. What’s more, it’s giving customers who bought them their money back.
“Welspun has not been able to assure us the illowroducts are 100% Egyptian cotton, which is unacceptable,” a Walmart spokeswoman told Fortune in an e-mail statement. Despite the excellent quality of the sheets, the retailer is “offering our customers a full refund,” the spokeswoman added. Walmart sold the Welspun sheets and pillowcases under the names “Better Homes & Gardens” and “Canopy.” The news was first reported by The Wall Street Journal.
Egyptian-cotton products typically command a premium from shoppers because they considered softer and more durable. American customers don’t gravitate as readily to sheets of other varieties.
In August, Target (TGT) announced it would remove thousands of Egyptian cotton sheets manufactured by Welspun from its stores and cut the company off after its own investigation revealed the supplier used non-Egyptian cotton for years. And it’s no small stock: Welspun claims to have manufactured one in every five towels sold in the U.S.
Other retailers questioning its Welspun supply include J.C. Penney (JCP) and Bed Bath & Beyond (BBY).
Unlike Target, however, Walmart said it would not cut all ties with Welspun, in addition to implementing stronger quality controls and adopting new labeling practices. Walmart started its own probe into Welspun in late August.
Walmart’s U.S. business has seen an uptick of late, with comparable sales rising eight quarters in a row. So the retailer is careful to avoid anything that could compromise shoppers’ view of the quality of its wares.
“Our customers trust us to provide products that are what they say they are on the label,” the spokeswoman said. Beyond customer refunds, the items Walmart is taking off shelves will be donated to Good360, a global non-profit organization.
