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Covid-19 Exposed Fashion’s Failed Supplier ‘Partnerships’

In times of crisis, relationships are put to the test—and unfortunately, many of the partnerships that brands and retailers had with their suppliers failed during the outbreak of Covid-19.

Panelists at the R/Evolution Sourcing Journal Summit didn’t hold back when voicing their disappointment with the “cancel culture” that ensued as brands realized they wouldn’t receive a return on investment on the orders they placed.

Canceled orders triggered a ripple effect throughout the entire apparel supply chain, costing makers millions of dollars and leaving garment workers’ livelihoods in peril.

For Mostafiz Uddin, managing director of garment factory Denim Expert Ltd., clients’ cancellations exposed how they really viewed their “partnership.”

“During this pandemic, we have realized that partnerships are a marketing tool for brands and retailers,” he said. “And we talk a lot about partnerships, but I don’t see one single example of a true partnership.”

Earlier this year, Uddin’s factory experienced a number of cancelations on finished and unfinished goods—both of which required raw materials that the factory purchased itself.

“When the pandemic started, they canceled all of their orders just by sending a letter—that’s all,” he said. “Millions and millions of dollars, raw materials, finished goods, unfinished goods—all just [canceled] in a simple email. Obviously, our relationship is totally destroyed, the trust is broken, and it will take a lot of time to rebuild this relationship.”

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While these actions spotlighted the question of ethics, it also exposed an issue of structure. According to Dan Rees, director of Better Work, an organization dedicated to improving working conditions throughout the garment industry, the pandemic illuminated the fashion supply chain’s instability.

“The speed of these effects that were felt really shows the fragility of the businesses in the supply chain and the jobs within them,” he said. “And it also asks very awkward questions about the way in which the supply chain is organized. I think we have to recognize that partnerships are not fit to deal with these extreme and unprecedented circumstances—they’re just not strong enough.”

Instead, Rees echoed what many experts have mentioned when discussing what it will take for industrywide progress: government intervention.

“We should insist and support the government in creating minimum wage structures to create industrial relations and to create the things that are needed for people to realize their rights, as well as support compliance within factories,” he said. “We need to shine the light on the responsibility of government and employees to do their thing and make sure the business relationship enables it and doesn’t undermine it. And we haven’t gotten that right.”

As consumers grow more conscious of the social and environmental impact of their clothing, they’re beginning to demand that brands show more responsibility—and prove it. According to panelist Brittany Sierra, founder of The Sustainable Fashion Forum, brands throughout the industry have made many promises, but have not taken enough action.

“Brands are making these grand claims that they’re able to hide behind,” she said. “I think that creating an international Bill of Rights [for garment workers] is something that’s needed. But I think that we also need to make sure that it’s actually being enforced.”

While a global pandemic shouldn’t be required to bring to light all of the deep-rooted issues within fashion’s supply chain, that’s often how it plays out, Sierra said.

“Unfortunately, it seems like a lot of times, that’s what it takes in order for change to happen,” she said.

Rees agreed, noting that throughout history, industrywide shifts have tended to “come from the outside and not from within.” And though the industry is currently situated for positive change, it’s still vulnerable to taking a step backward.

“We have to recognize the likelihood that the working conditions are going to deteriorate in an environment of very high unemployment and difficult economic circumstances,” he said. “So, I think this is a moment where businesses need to pull together and really ask themselves about the expectations of their customers, and ask themselves about the expectations of investors and others towards what really are human rights in the supply chain.”

All the sessions from this year’s Sourcing Journal Summit, R/Evolution, are available on-demand for the first time. Follow this link for more information.