While COVID-19 has exposed major cracks in the supply chain, it’s also unearthing a problem of partnership—there may be a dearth of it at a time when neither retailer nor supplier can afford it.
“The old adage about a chain only being as strong as its weakest link is absolutely true,” Avedis Seferian, president and CEO of Worldwide Responsible Accredited Production (WRAP), told Sourcing Journal in the second installation of its ‘On the Ground’ video series. “Brands need factories and factories need brands. Neither one can exist without the other and right now every one is hurting.”
Retailers continue to cancel orders as they face the crisis of still-closed stores and cash that’s running dry, and financially strapped factories have made urgent pleas for partnership. It’s a double-edged sword that’s cutting into business viability on both sides of the aisle. But if there’s any hope of protecting the supply chain for a post-coronavirus world, buyers and suppliers will have to find a middle ground.
“Factories need to recognize as well that a part of that brand’s responsible behavior is ensuring that they continue to exist as businesses themselves,” Seferian said. “There’s a lot of pain going around right now, and honestly the best way to handle it is to share it.”
Without a greater acknowledgement of that interdependence and some concessions made to protect the health of workers living in densely populated manufacturing cities, order deliveries, when they do resume, could be in great jeopardy.
“I understand India, I understand Bangladesh, I understand all these countries trying to force a lockdown. If they can do it right, it should indeed be helpful [in slowing the spread of the virus],” Seferian said. “But if they’re not going to be able to, if these dense population scenarios prevent that social distancing from actually working, then yes, we do run the risk, very much, of when things reopen in the West and we’re able to start placing orders again, we’re not going to be able to have workers healthy enough to start working on them.”
Check out the first video in new our ‘On the Ground’ series, where Rubana Huq, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), outlines just how great of a toll coronavirus is taking further up the supply chain.