Government interim report into the sustainability of UK fashion industry – where were the manufacturers?

Lack of manufacturers represented at the Government’s review of the sustainability of the UK fashion industry is very telling – what can be done to give them more of a voice?

UK manufacturers
If manufacturers have to lower their prices every season soon there won’t be any left

Last week the UK Government released its interim report into the sustainability of the fashion industry. One of the issues that they addressed was concerns over fast fashion and how it might be leading to poor working conditions in UK garment factories where workers were being paid below the minimum wage and why this was happening.

In particular the finger was being pointed at Leicester, where there are over 700 textile companies predominantly manufacturing for the UK fashion retailers.

Fifteen of the biggest UK fashion retailers were called in to give evidence, including ASOS, M&S, Primark, Boohoo and MissGuided.

Many of these retailers manufacture in the garment factories in Leicester in order to deliver ‘fast fashion’ i.e. product that can be made to reach the customer in the shortest possible space of time.

This is not the first time that Leicester has been in the spotlight. Only 18 months ago I attended a meeting there to try and address some of the issues regarding how some of Leicester’s garment factories were operating. Whilst it is frustrating that not much has happened since then, it is good to see that at least the topic is now being addressed by MPs.

The one thing that is really interesting from all the evidence that has been produced for the enquiry so far is how little has come from any of the manufacturers or factories themselves.

I think that is a real shame, as their silence can be taken to mean that they are guilty.

There is just one written piece of evidence from a manufacturer, and even that is written anonymously. In the letter it says:

We are constantly told to reduce our prices from their buyers, this is a top-down approach placed on us. The senior managers know they can wipe their hands clean and place the blame on us the suppliers such as min wages etc. It’s the biggest elephant in the room. The largest CEO’s and Senior managers know the cost of clothing; they also know they can get away with it.”

I’ve heard similar stories from many manufacturers that I’ve visited.

They tell me stories of buyers coming to visit them and squeezing them on price again and again until they get to the point where they say they’re not prepared to go any lower, and then the buyer goes elsewhere – usually to one of the other 700 factories in Leicester. If they lose the order their factory may go out of business because it kills their cash flow. So they’re damned if they do and damned if they don’t. It’s a vicious circle.

The fact that no manufacturers were invited to give evidence is very telling of the fashion industry as a whole. Manufacturers are more often than not the unspoken voices in the industry.

So what can be done to give garment manufacturers more power and a greater voice?

Here are three things that I think that should be done to address the supply chain issues raised in the Government’s review of the sustainability of the fashion industry:

  1. Greater transparency of supplier lists

Retailers and brands should be required by law to be more transparent about their supply chains, including producing up to date lists of all of the factories that they are working with.

As part of the enquiry ASOS has produced a list of every UK textile factory that it works with – the others should be made to do the same. BooHoo said that they couldn’t produce such a list to reveal the seventy six CMT units that it works with in Leicester, claiming that it is their ‘engine room’.

But if companies were forced to reveal who they were working with I believe it would help to expose where there might potentially be issues, hopefully forcing the bad factories out of business.

It would also prevent big retailers from dominating one particular factory, to the point where they sit in a position of power over a manufacturer.

2. HMRC enforcing minimum wage with textile factories

According to Financial Times journalist Sarah O’Connor who was interviewed as part of the enquiry, HMRC is as much to blame.

She said that enforcing the minimum wage is their responsibility, yet only 83 textile workers had been identified as being paid below the minimum wage in the last year.  She said that part of the reason is because garment factories are pretty small and difficult to find, and so weren’t given top priority by HMRC.

If the retailers were forced to name who they were working with HMRC would know exactly which factories to follow up with – they’d have no excuse!

This would then expose the bad guys and stop them ruining the reputation of the rest. If everyone was paying the proper wage it would solve half the battle. Yes it may mean that the price of finished goods would go up a little, but that then brings me onto point number three…

3. Retailers producing open costings

Something questioned by the MP chairing the committee was how BooHoo could actually produce a dress for £5 that is made in the UK.  Whilst during the enquiry Carol Kane, the CEO of BooHoo came back with the reason that the dress was a loss leader, since then BooHoo have submitted a written statement detailing the costings of the £5 dress – it makes for interesting reading.

In summary, BooHoo states it only takes 8 minutes to make such a simple and short dress, and they can therefore make seven or eight an hour. The also said the dress uses fabric that is ends of lines that would otherwise go to waste.

Which lead me to think that it would be beneficial if all retailers were obliged to give open costings on the products that they sell.

Whereas years ago this might have seemed like pie in the sky that they would give out such confidential information, these days it is not unheard of for companies to give customers a breakdown of why a garment costs what it does.

Menswear brand Private White V.C. have a pricing manifesto on their website and in the US retailer Everlane has made a whole business out of giving its customers detailed pricing information on its products.

For too long manufacturers have been the unsung heroes of the fashion industry, and sadly this lack of voice has yet again led to them not being heard.

There are so many GOOD factories in the UK – let’s hope that following the final report from the Government’s Environmental Committee more attention is given to them and less to the bad guys!