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“The Low Price” of the textile discounter KiK – consequences for labour conditions in textile factories in Bangladesh: Difference between revisions
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“The Low Price” of the textile discounter KiK – consequences for labour conditions in textile factories in Bangladesh (view source)
Revision as of 15:37, 7 March 2011
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The big discounters who have a huge market power use three main purchasing practises in their direct interaction with their suppliers from developing countries. These three tendencies are receiving their products “cheaper” and “quicker” and in addition are including the reduction of their own risk by applying “risk-shifting” methods. | The big discounters who have a huge market power use three main purchasing practises in their direct interaction with their suppliers from developing countries. These three tendencies are receiving their products “cheaper” and “quicker” and in addition are including the reduction of their own risk by applying “risk-shifting” methods. | ||
The prices are dictated by the big clients. The producer in Bangladesh takes such small prices because otherwise he loses his order. Gisela Burkhardt, an expert for development politics, confirms that “suppliers are threatened with being removed from the lists, if they do not reduce the price.”<ref name="A" /> Although the costs of energy have risen, the prices for garment still decline. This is again only possible because the wage costs are reduced. | |||
The second practise method is the timely pressure that is put on the suppliers. The discounter demands quick production time. There are two main causes to name for this demand. On the one hand the fashion business today is changing very quickly. Collections in the past change only twice a year, but today there can be changes every month, that mean twelve times a year.<ref name="A" /> The discounter wants to be very flexible which implies that their store-houses should act only like a logistic-centre where in-coming products are reorganised and immediately delivered to the final stores. So at best case nothing stays long in the store-houses. This system is in fact very economic but needs a good working, dependable and especially quick supply chain. Today the internet offers the possibilities to launch an order for products that are produced on the other side of the world. Again the producers are under pressure to react quicker than their competitors. They do not have enough time to calculate thoroughly. They depend on the orders and therefore no order is much worse than a bad order for a low price. | The second practise method is the timely pressure that is put on the suppliers. The discounter demands quick production time. There are two main causes to name for this demand. On the one hand the fashion business today is changing very quickly. Collections in the past change only twice a year, but today there can be changes every month, that mean twelve times a year.<ref name="A" /> The discounter wants to be very flexible which implies that their store-houses should act only like a logistic-centre where in-coming products are reorganised and immediately delivered to the final stores. So at best case nothing stays long in the store-houses. This system is in fact very economic but needs a good working, dependable and especially quick supply chain. Today the internet offers the possibilities to launch an order for products that are produced on the other side of the world. Again the producers are under pressure to react quicker than their competitors. They do not have enough time to calculate thoroughly. They depend on the orders and therefore no order is much worse than a bad order for a low price. | ||