Bangladesh Factory Collapse: The Hidden Cost of Cheap Clothes

When we go shopping, most of us are primarily concerned with the cost of things. That makes sense, we have to keep our budgets in check and not spend more than we earn and all that other fun stuff that comes along with entering adulthood. So when we see a pair of $19 jeans versus a pair of $34 jeans, we are probably going to pick the cheaper product. It’s not likely that many of us consider what it takes to get prices down that low, but it involves a lot more than just streamlined manufacturing processes. With the media coverage intensifying around the companies who were supplied clothes by the Bangladesh garment factory that collapsed last week, we take a new look at extreme pricing. 

News of the factory collapse prompted retailers like Sears Canada, Wal-Mart Canada and the parent company of Joe Fresh, Loblaw to come together in an emergency meeting. They met to discuss how they can team together to combat sweat shops. That’s not an easy task when you are trying to sell pants for $19 and still make a profit. That's all part of the fast fashion business model. Quickly turning around the newest trends at the most affordable price is bound to come with some consequences. It just so happens that one of those consequences are the lives of others. 

In the Forbes article that discusses the factory collapse they appear to suggest that these companies are powerless against an incredibly corrupt government.

“As the death toll ticks upwards, it remains to be seen what exactly Joe Fresh will accomplish in Bangladesh. The company faces rampant corruption at every level of government, trickling down to the garment factories, policed by thugs who threaten workers with docked wages if they don’t work brutal 13- or 14-hour shifts, often seven days a week.”

This is where Forbes and I part ways. I don’t buy into the whole, “Well it’s the governments fault, it’s not like the companies can do much to prevent it.” Multinational corporations like Wal-Mart, Sears, or Loblaw have incredible amounts of power because they have incredibly amounts of money.That much should be obvious to us. Much of the time, these companies do not seek out change from their suppliers until the public demands it. That’s what we are currently seeing with Apple and their supplier Foxconn. There are regular updates about how Apple is attempting to improve conditions there, or what their specific role is in trying to get the company to prevent egregious labor violations. Those changes did not begin to happen until after some fairly embarrassing and damning public reports came out.When the public or the media does happen to point out the role companies have in disasters like the Bangladesh factory fire that killed 112 less than five months ago, private companies take notice. Even if they cannot directly convince the government to change overnight, they can still improve safety standards. Gap Inc. did this buy hiring out a private fire safety firm to look into the safety practices of their supplier in Bangladesh. Gap Inc. also invested $22 million dollars in improving safety standards in its factories there. 

Well, the reports from the Bangladesh factory collapse are just as damning as those we have heard from Foxconn and elsewhere. More than 400 people are dead but the death toll is expected to rise much higher as many are still missing and feared dead. Charles Kernaghan for the Institute for Global Labour and Human Rights, told Forbes magazine, “They didn’t want to go into work as there were already deep cracks in the walls the day before. They were driven into that building by people with clubs waiting to beat them up — gangsters and goons. They went in at 8:00am and the building collapsed at 9:00am.” 

We know that companies are great at enforcing the practices and codes that are important to them. Perhaps no company is better at this than Wal-Mart. Wal-Mart has extremely strict guidelines for how it interacts with its suppliers. It demands a lot from its suppliers in terms of cost and streamlined supply chained practices. All suppliers have to prove their worth to Wal-Mart through a rather laborious trial period that they are forced to go through before being granted that first purchase order. Wal-Mart is notorious for using its buying power to force suppliers into producing goods at the cost that Wal-Mart has set for them. It's useless to pretend that these kinds of MNCs don't have power over the practices of its suppliers.

So while retailers like Joe Fresh send out their representatives to survey the damage and put together their publicity crisis management teams, hopefully they will leave a little time to question the role extreme pricing has in all of this. Honestly, if we were to just take some time out of our day to put some pressure on these companies, I'm sure we would all be surprised at how quickly new safety standards were set in place. If that means that we might have to pay an extra $4.00 for a bikini, would we be willing to accept that trade off if it meant saving lives? I hope so.