Dhaka building collapse highlights impact of supply chain on brand

The tragic building collapse at a clothing manufacturer in Dhaka has thrown the spotlight back on to the issue of the supply chain and the actual cost of fast fashion. Primark, Bonmarché, Matalan, Benetton, Mango and Canadian brand Joe Fresh have all been linked to the factory but what of their reputations?

Rosie

Some of the retailers involved have moved to pledge support families of those affected by the disastrous event that killed around 400 people and injured many more.

Primark has said it will compensate families while Matalan, another value fashion chain that has used the site in the past, has said it too will provide financial “and other” support to the affected community.

The lobby group War on Want held a protest outside Primark’s flagship Oxford Street store last weekend, and has set up a petition to put pressure on the retail brands to go further and offer full compensation. More than 67,000 people have already signed the petition on Change.org, demonstrating that supply chain and workers’ rights are a major issue for consumers.

Primark’s Buzz rating on YouGov’s BrandIndex, which measures the positive and negative things consumers have heard about a brand, has declined dramatically since the building collapse. It is down from 5.9 on the 24 April to -12.7 today (2 May) – it’s lowest rating for more than two years. Though offering support to those affected is the right thing to do, it doesn’t go far in restoring consumer faith in the brand.

What makes it a particularly bitter pill, is that the Dhaka disaster came just days after Primark owner Associated British Foods revealed the fashion chain’s 24 per cent revenue gains in the six months to 2 March helped drive a 10 per cent revenue increase £6.3bn across the group. Primark’s profit also soared 26 per cent to £415m.

While offering support is a good first step and shows the corporates taking responsibility for the communities in which their manufacturing is based, the whole awful scenario only serves to remind companies and the public of how much more there is to be done.

If Primark can increase its profit by 26 pet cent, could it not afford to invest a little more in safeguarding the people who work in its supply chain?

War on Want claims the disaster in Bangladesh was “a calamity waiting to happen, because high street chains failed to ensure proper safety measures”.

Long have the corporate reputations of retailers and fashion been tainted by accusations of unethical practices and the majority of high street fashion retailers, including Primark, are already signed up to the The Ethical Trading Initiative (ETI), an alliance of manufacturers and GNOs that work together to improve standards of people who make consumer goods.

The industry has made enormous strides in improving the factory conditions and improving conditions for workers. It should go without saying that it’s a long and complex process that cannot be fixed overnight.

Until dramatic progress is made, brands will continue to face damaging accusations and tarnished reputations over alleged unethical practices that some think allow retailers to sell fashion items dirt cheap and reap huge profits.

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