Lopsided nature of global fashion industry and why change is needed

By Mostafiz Uddin Reprint | | Print |

Dec 7 2020 - The global apparel industry is broken and only urgent, drastic surgery can fix it. I am not talking about another initiative or another public relations exercise. I am talking about deep, systemic change to be agreed by all involved—by brands, by suppliers, governments, unions and NGOs.

Why do I think this? Let us look at the evidence. In the past week several news stories have made headlines around the world. All are interlinked and, together, they paint a picture of an industry which continues to serve one set of interests at the expense of another.

One story is when the latest lockdown ended in the UK, shoppers were said to be queuing in the middle of the night, in the freezing cold, in anticipation of fashion brands opening its doors. People are supposed to be struggling financially in the west, but the fast fashion industry marches onwards. The fashion brands and retailers have had a similarly positive response since reopening stores. Nothing seems to stand in their way.

Story number two concerns a company which I have worked with in the past—Arcadia, which owns British brands Top Man, Top Shop and Burton. Arcadia has this week gone into administration, as has department store, Debenhams. Both have been struggling for some time, and have been hit hard by the coronavirus pandemic. The potential bankruptcy of these two companies will hit hundreds of garment suppliers in Bangladesh. When the liquidators come to pay creditors, suppliers will be way down the list. Many will be lucky to receive anything at all and will take a massive financial hit.

They may complain but they also know that this is just how it is in our industry. In Bangladesh we are at the bottom of the food chain, just like our garment producing compatriots in India, Cambodia, Myanmar and so on.

Taken together both the stories illustrate the completely lopsided nature of the global fashion industry—and tell us why something has to change.

How can it be that in one part of the world, shoppers are queuing through the night to purchase clothing while in another part of the world the manufacturers are suffering by not receiving their legitimate payment. How has our industry reached this state of affairs? The very people who are bearing the brunt are the most vulnerable group of the fashion supply chain—workers.

Failure does not seem to be an option for many western retailers and department stores. In recent years, we have also seen the likes of Sears Corp, Peacocks and Forever 21 in administration or undergoing restructuring. Why? Because they were not making money. They restructure and in that process a lot of their debts with suppliers—yes, that’s people like me—are written off. Then they return and the whole process starts again.

Nobody should begrudge apparel brands and retailers for their success. But we need to think very carefully about how we can ensure the benefits of this success are shared right along the supply chain. If an industry has one part in which companies are making huge profits while in another part, workers are going hungry, something has clearly gone very wrong. Something is out of kilter.

This brings me to the final point relating to Arcadia. When a brand goes bust—as several have during this pandemic—it is always the suppliers and their workers who suffer the most.

We can all also see why retailers are struggling, and they have my sympathy (in some cases). What I fail to understand, however, is how there is not some kind of protection in place for workers when a major brand goes bust. For some time now, there have been calls for some kind of fund or pot which brands would pay into as a part of doing business with garment factories in Asia. This fund would be used to ensure workers are paid severance and legally owed wages in the case of insolvency.

This may sound extreme but we have already seen that brands simply cannot be trusted to protect the workers in their supply chains through voluntary codes of conduct. Yes, there are many brands and retailers who are not only trendsetters but also pioneers in global business in responsibility and practicing ethics as well as taking care of every member including workers. But there are also many who do not care—some of the more glaring examples we have seen during this Covid-19 pandemic.

As suppliers, we cannot depend on the goodwill of brands. It has become clear now that our industry needs binding legislation and supply chain regulation to hold brands to account for respecting human rights in their supply chain.

We cannot as an industry keep talking about things and saying this or that will change in the future. We have been saying these things for decades. Words are all well and good but, sadly for garment workers, they don’t put food on the table.

Mostafiz Uddin is the Managing Director of Denim Expert Limited. He is also the Founder and CEO of Bangladesh Apparel Exchange (BAE).

This story was originally published by The Daily Star, Bangladesh