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Many retailers which the average American may shop in source Paper

Words: 1075, Paragraphs: 8, Pages: 4

Paper type: Essay , Subject: America

Many retailers, which the average American may shop in, source their goods and production primarily from third world/developing countries such as India, China, Bangladesh and other countries in the South Eastern hemisphere and across Asia. Stores such as H&M, Walmart, The Gap, Zara’s etc. are buying heavily from these countries to keep costs down in order to show an attractive profit and sales to the American and European market. This textile market for these companies are $3 billion or more annually. With these countries low bidding their work to this major retailors means costs cut somewhere, which typically ends up in infrastructure. Whether it be the supply chain that may be short changed, or the working environment, these companies want to stay loyal for long-term large contracts. In Bangladesh, the Rana Plaza building collapses due to unsafe working conditions and kills nearly 1,100 workers, the companies inside represent a multitude of US businesses production lines.

In this case, there is a multitude of stakeholders both internal and external. The internal stakeholders are the primary employees who are working in these unsafe conditions and who have died recently in the multiple building collapses. Likewise, the owners/bosses of the firms who are doing the actual production are stakeholders that need to answer for all of the work.

External stakeholders are the local government of Bangladesh, including Sohel Rana, a local politician who owned the building; neighboring countries who are competing for their business as well. The American companies who are sourcing goods from Bangladesh are just as involved and responsible. Shareholders of these major U.S. corporations can and will be affected. Along with the consumer of the Walmart’s, H&Ms, etc.

With Bangladesh competitively bidding for work from the U.S. retailers, this puts all responsibility within the borders of Bangladesh, the owners of these companies and local government; it should not be the U.S. retailer’s responsibility. The government should enforce stricter working environment conditions for these firms, by doing this it will help create jobs to do safety tasks and inspections duties, by having additional jobs will help their own economy. This will also help put a family at ease when a loved one goes off to work knowing they will return home safely. It seems a bit of corruption may have be going on, as a local politician owned the building as well, so enforcement from a government agency directed towards a politician was probably shied upon.

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Another examination of this topic could be the exact opposite where the U.S. retailers should be held responsible. When they put out their bids into Southeast Asia, they should put in language to enforce safe working conditions. Requirements like this, will force companies to institute more stringent policies and procedures in place, it will also increase their bid, but it will also be a quality bid and a quality business transaction. Some companies may even feel that they are doing well in their whole supply chain process concerning safety, without taking into consideration that others just see them as profit driven. Doing this can create legal issues for certain U.S. retailers, as some of these third world firms are now under their umbrella of liability while being in other countries. It should be observed of local laws and regulation first, this will help determine whether a company should decide to go this route.

If examined with the world’s economic market in hand, one can say it is both parties’ fault, the Bangladesh culture and the United States/ European economics way of living. With the U.S and Europeans being one of the largest retailers in the world, it would only be smart for the companies to source production elsewhere to keep their costs low. By doing this, production ends up in 3rd world countries and shy away from examining safe working conditions, which will help keep costs down. Keeping costs low is attractive to the consumer and every phase of the supply chain but not at the employee’s expense. Altogether, it would beneficial if safe working conditions were to be put in place, thus, retailers would be required to act diligently concerning safe working practices at all times, not just outside the retail store for consumers to see.

Many retailers that do business within Southeast Asia is part of a supply chain coalition to bring better human rights in these areas for a safer working environment. This pledge was created to help stop many deaths due to unsafe working conditions, but it does not seem that it is being acted upon as of yet. Buildings are still collapsing but some companies are slowing getting on board, which maybe in the coming years’ progress can begin to show regarding this epidemic. Thus, the hiring of independent inspectors along with engineers to do inspections on working sites, to assist in making locations much safer and cut to down on injuries seems like the correct plan of action. Many consumers are not aware that they do not care or understand the situation since most see the apparel in a fancy store on a rack looking nice. They do not realize the sweat and tears poured into this with people who may be scared to go to work praying they come home safely.

With many of the major U.S. retailers possible having a greater potential of being in worldwide news, it would behoove them to have safer practices standards for production and manufacturing across the world. If bad practices are continuing to occur and people are constantly dying, the public is more than like to perceive that it is the big name firms permitting these actions to progress, as oppose to the small companies in the developing countries – image is key with major retailers concerning this issue. By being active in the healing process of safe working conditions, attentive quality control and quality assurance will assist with decreasing fatalities in the skilled labor force, so production can stay effective. Furthermore, factories will not keep collapsing, so the downtime for finding new places and building new manufacturing facilities will also tend to reduce. However, if the up keep on the infrastructure is not acceptable, one can assume a relatively lower budget for the buildings operations/ maintenance cost, but inefficiency will be extremely high. Therefore, in opposition, a properly trained workforce with everyone actively working safe throughout the life the building, theoretically will lower cost while at the same time increase efficiency, which is also helps keep the cost low the entire time.

About the author

This paper is written by Sebastian He is a student at the University of Pennsylvania, Philadelphia, PA; his major is Business. All the content of this paper is his perspective on Many retailers which the average American may shop in source and should be used only as a possible source of ideas.

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