It’s Fashion Revolution week friends! This week, we wanted to highlight the systemic issues within the supply chain that create an unequal distribution of power, risk, and reward between brands and suppliers. Fashion Revolution is asking us #WhoMadeOurFabrics and it’s time we got to know everyone involved behind the seams, including #WhoMadeMyCotton. To gain a thorough understanding of the systemic issues fuelling an unequal distribution of risk and reward, my right hand gal Virginia and I had the honour of chatting with Kim van der Weerd and Jessie Li, co-hosts of the Manufactured podcast.
One of the key things we learnt was that the “problems” in our industry are viewed incorrectly. What do I mean by that? Well, what's the cause of these problems? More often than not, our problems are symptoms of systemic power imbalances.
Let’s apply this thinking to overproduction. Why do we overproduce clothing? Is it because brands want to sell as much as they can? Is it because we have insane consumption habits that drive demand? Well maybe yes, but let’s think about the power dynamics here.
When brands place orders to manufacturers to produce their products, the manufacturers have to front the cost of all the materials needed. Let’s stop there because WHY?! It’s the brands product, they should be fronting the cost (in Virginia’s and my opinion). But, that’s not the case. Manufacturers buy the materials and produce a brand’s products based on how much the brand thinks they’re going to sell.
But, as Kim likes to put it, no one has a crystal ball into the future. There’s no way we’d be able to tell how many pieces of an item they’re going to sell. So, manufacturers are left having to produce more than what the brand actually needs. But, brands don’t care because they have no skin in the game! They've pushed it all down to suppliers! They don’t care that the factory has already hired enough staff to make what the brand thinks they’ll sell. But what if brands did have to pay for the materials and labor needed to make their stuff? They’d think a lot harder about wasting anything - whether that be materials or labor - and start seeing their suppliers as partners like it should be.
Right now, suppliers are scared to say no to these forecasts because brands can just go to the next supplier that will say yes to their demands.
Why don’t sustainability reports speak about real issues, such as the shared impact of incorrect forecasting? Every brand which markets its sustainability has a carbon reduction target, but does that include the disposal of overproduction, quality defects and fabric offcuts? Why is there never any information about brands paying suppliers for their samples or the time that workers spent working hard trying to learn complicated designs, or finding impossible supplies? Why are those considered suppliers responsibilities?
It’s complicated, I know, but let’s hear it from Jessie and Kim! They have both experienced all this first hand, Jessie has seen both the brand and supplier side, while working in quality inspection and merchandising in China and Cambodia, and Kim who went from studying human rights to becoming a factory manager with the goal of better understanding the issues with the industry.
HELLO! KIM, HOW DID YOUR EXPERIENCE AS A FACTORY MANAGER AFFECT YOUR OPINION ON THE GARMENT INDUSTRY, AND HOW DID YOU DECIDE TO BECOME AN ADVOCATE?
As a result of all my experiences, I strongly believed that supplier perspectives were underrepresented and misunderstood, and I wasn't exactly sure what I was going to do about that. I ended up in Amsterdam, at the end at the end of February 2020, and thought, “how can I get beyond just my own experiences and create a platform to allow others to improve the mutual understanding across the supply chain? We're just not speaking the same languages.” And that's how we came up with the podcast that we do now.
Before 2017, I lived and worked in the garment industry in China for a third party inspection company. We were mostly hired by brands to inspect the quality of finished goods in the factories, which allowed me to learn a lot about the relationship and power game between brands, manufacturers, and inspection companies. After that I moved to the merchandising side, and it became my job to contact a lot of factories, which is where I started to understand how production looks like from the suppliers’ point of view, including subcontracting, and how very different it is from the brands’ perspective.
WHAT ARE THE KEY ISSUES YOU PREFER TO SPEAK ABOUT IN YOUR MANUFACTURED PODCAST?
I think it depends on the guest. But, if I had to explain it in an overarching way, I think that for a lot of people the idea of a supply chain is so abstract, so hard to put into concrete terms, that it remains a nebulous set of disconnected pieces. It's not so much about a single question that we want to ask everybody, it's more about creating a tangible picture of who the people in the supply chain are, and what are the various steps that a product goes through. Not limited to production steps, but people steps too, and how they relate to each other. Who are the people who make up the supply chain? You hear about brands, you hear about workers, but there's so much more in between. What are the relationships, both upstream and downstream, and who is everyone dealing with? Who are they selling to? And who are they buying from?
I agree that it's really a case by case instance. If we're interviewing small and medium sized manufacturers, my first focus is on how they manage their day to day operations. Usually, they struggle with the pressure of cash flow, and if they manage to get out of this pressure, it often means that they have a real partnership with their clients, who share some financial risks with them or distribute values back to them fairly. What I try to understand is how small and medium suppliers deal with financial pressure. If the interviewee is a bigger player, I try to understand how they managed to prioritize sustainability, and if their experiences can be copied, or applied to other players.
WHAT MAKES YOU ANGRY ABOUT THE SUSTAINABLE FASHION AGENDA?
I am, in general, very frustrated with the direction that most conversations around sustainability take: there's a lot of confusion about what is a symptom and what is a cause. More often than not, the cause has to do with an unequal distribution of risk and reward. And yet, that's not talked about much. One of the things we try to do with the podcast is to put it into clear and concrete terms what the distribution of risk and reward really means, how it plays out, and what the different ways of structuring these relationships between actors across the supply chain are. There is a lot of research out there showing that worker conditions are far worse in subcontracted facilities, and that workers are not treated ethically. But the conversation is focused on having factories that are more highly regulated and have a lot of oversight, to avoid this. It is ridiculous that nobody is analyzing the root cause of why those subcontracted facilities exist, which is the unequal distribution of risk and reward.
What makes me angry? Auditing being seen as a control tool or policing system. It usually comes after a scandal, you hear people calling brands to take more responsibility to check their supply chain. I'm quite alert to this sort of narrative because brands have a lot of power. When they check their own supply chains, the responsibility gets pushed to their suppliers: brands can claim that they audited, they checked, but the supplier lied and found a way to escape. The brands become the good guys, and the suppliers the bad guys. I don’t think the real problem is brands not doing their due diligence, but the unbalanced responsibility of the risk and reward.
France just passed a law forcing brands to be responsible for their supply chain, which however doesn’t require transparency on benefits distribution. What's missing is the accountability. We should have a law to allow the public to check the benefit distribution of brands, and see how benefits are distributed back to their supply chain, and analyze whether that is reasonable, which is the key to accountability. Whether it’s auditing, subcontracting or due diligence, the theme that ties them all together is the systemic problems in the industry. Just pushing more responsibilities down to the supply chain makes things worse. An analogy to this can be racism in the United States, the problem is not that you have people running around saying they are racist, or don't like people of colour. The problem goes far beyond that, it’s systematic. Until when each of us as individuals and as organizations understand that we are implicated in a problem in ways that we may not realize, such systematic problems cannot be fixed. Each of us, who are part of this system, whether that's a brand, supplier, worker, consumer, investor, in what ways are we contributing to a set of incentives that leads to outcomes that we all agree are not good? What Jesse just described is very much a passing down of the problem and basically pointing the finger outward, as opposed to holding the mirror and asking, in what way am I guilty? How am I contributing to this?
Thank you Jessie and Kim for the amazing and thought provoking conversation!
So, this Fashion Revolution Week, I want to encourage everyone to keep being curious and asking these hard questions! But, something we can all do is look in the mirror and ask ourselves: “What we can do to help?”
Until next time friends, always be curious and STAY DILIGENT!