Retailer strategies – Who is responsible?

Where does my T-shirt come from?

In a recent conversation with a friend the following statement was made by her: until we realize that it is not right that we go into a shop in Denmark and get 3 t-shirts for DKK 100 (less than USD 20), no one in the production line of clothes will get better working conditions.

This I could only agree with, and I was somehow stunned that I had never really given that price any consideration before – an easy estimation of the production will tell me that this is ridiculous. For example; most t-shirts are produced from cotton – this is most likely grown either in the US (heavily subsidised) or on the African continent. Then it is transported from here to Asia for further production (if it is produced in Africa the raw cotton will have been transported somewhere else for processing before heading to Asia). In Asia, it will be treated, coloured, printed, sown and packed. After this it will be shipped across the world again for retail in Europe... Most retailers put a sales value of 250% on top of their cost price per item – now with this in mind; how is it possible to sell 3 t-shirts in Denmark for Dkk100? This amount equals the hourly minimum wage for anyone over the age of 18, so roughly an 18 year old will only have to work 2 hours to have the net payment (Denmark has an average of 50% tax on incomes) worth the same as the entire production line of 3 t-shirts. Logically this should not be possible. But it is.

The (recent) disaster in Bangladesh

Recently the concept of clothes production came to the surface again when the Rana Plaza factory in Bangladesh collapsed. The world should have been outraged – and granted there were some demonstrations in front of retailers in Britain (http://www.reuters.com/article/2013/04/27/us-bangladesh-building-retailers-idUSBRE93Q04H20130427) and articles around the disaster and the responsibility of the Bangladesh Government and the international companies with production in the Rana Plaza (http://www.forbes.com/sites/howardhusock/2013/05/02/the-bangladesh-fire-and-corporate-social-responsibility/ ; http://business.time.com/2013/05/02/bangladesh-factory-collapse-is-there-blood-on-your-shirt/), but has anything changed, will anything change - Most likely not. Bangladesh is the world’s second largest exporter of garments (China is the largest) and according to Reuters this is a business of “about $15.6 billion of ready-made garments each year - about 80 percent of its total exports. Sixty percent of Bangladesh's garment exports go to Europe; the United States takes 23 percent, and Canada takes 5 percent” (http://www.reuters.com/article/2013/04/27/us-bangladesh-building-retailers-idUSBRE93Q04H20130427).

If I was a government and 80% of my income depended on exports of clothes, how picky would I be about the safety of my workers, especially if 87% of my ‘customers’ didn’t care?  Would I tell these customers, ‘yes I know I depend entirely upon you, but I will not let you exploit this country and its people just so you can sell t-shirts for less than 5 USD each’. I hope I would, but if I have to be honest, I probably would not.

To blame or to take responsibility…?

Based on the above, the responsibility for disasters like the Rana Plaza lies with the companies, they should check their production line, and they should know what is going on from raw material to retail sale. Granted some do make an effort, but they then also easily claim that their production contractors sub contract, and how are they supposed to follow up on this? It is clear that they cannot if they do not set aside resources, but why should they do that when the consumers are no demanding that they do, and they have investors that demand a profit?

Private companies are exactly that - private companies. For many multinational companies the figure on the bottom line might matter more than the living conditions of those partaking in creating those figures – especially if they live in a such faraway place (from Europe and the US) as Bangladesh, China, Pakistan or Vietnam.  

Bryan Walsh of Time states that "International retailers can do more to advocate safer standards at textile factories that manufacture their wares, in Bangladesh and elsewhere. Customers can do their part by putting a little pressure on their favorite brands, though that would require placing as much value on the cost of a life as you might on the cost of a T-shirt (http://science.time.com/2013/04/29/fast-cheap-dead-shopping-and-the-bangladesh-factory-collapse/).

So the question is, is a life worth more than the cost of 3 t-shirts for DKK 100? I would think so, and yet does that stop me from buying clothes in a cheap store where I might suspect that the close are produced under similar conditions as in Rana Plaza? No, not always! And I will excuse myself with something like this; I don’t know for sure that these clothes are produced under such conditions, I have many expenses and a high cost of living in general so I do not have money for expensive clothes, and finally, just because a piece of clothe is expensive it is not necessarily produced under better conditions.

According to Reuters I am not alone in this – Mohini Raichura is also making decisions like that “Raichura, a 30-year-old London charity worker, was shopping Friday at Primark, a discount retailer owned by Associated British Foods, even though she knew that some of its products were made at the factory that collapsed earlier in the week.

"I go there because it's cheap. That's awful. It really makes me a bad person," Raichura said. "But you know, I work for a charity, I'm on a limited income, and I pay rent in London —that's how I justify it."” (http://www.reuters.com/article/2013/04/27/us-bangladesh-building-retailers-idUSBRE93Q04H20130427).

Mine and Mohinis excuses are all true, but do they actually excuse our consumer behavior? And where does that leave us? I know that being able to buy 3 t-shirts for 100 DKK should not be possible. Yet, when I am looking at them, I am not thinking, of this, I am thinking of how I need exactly 3 t-shirts, and how great it is that I can get them for such a low price, and then I might also be able to get something else...

So who is responsible for the repeated ‘Rana Plaza disasters’ that has happened and will continue to happen? The Governments overlooking regulations to increase their GDP, the multinationals that are looking out for their profits, or is it me and you?

In the end you and I are the ones putting on these clothes every day, we know, or at least we should know that our purchases affect peoples’ lives all over the world. So why is it not (also) our responsibility to make demands of the multinationals, who will then be forced to make demands from the Governments where they have their clothes produced? – The same clothes you and I put on every day.