Blog: Production shifts bring potential problems
Leonie Barrie | 7 October 2013
Details of nearly 1,600 Bangladesh factories used by more than 90 leading fashion retailers and brands were released last week as part of a commitment to improve safety and transparency in the country's garment industry.
The list has been compiled by the mostly-European brands and retailers who have signed up to the Accord on Fire and Building Safety in Bangladesh, and the factories account for around one-third of the country's total. Much of the information has never previously been disclosed in the apparel industry, the group says.
But a week of violent protests in Bangladesh's key apparel industrial belts has also heightened concerns about the country's reliability as a source of clothes. Financial losses of around BDT6.0bn (US$77m) for apparel makers, along with higher production costs, are seen among the consequences.
In a similar vein, a new report based on factory audits suggests buyers who shift production to lower-cost regions in Asia - including China and Bangladesh - do so at the likely cost of social compliance.
And while an agile and efficient supply chain should be a must for any fashion brand or retailer, the market disruption caused by the internet and globalisation is making it more vital than ever before.
Fast-reacting supply chains are also the focus of this month's management briefing, in which just-style looks at the impact increasing demand for up-to-the-minute styles and trends at relatively low prices is having on manufacturing, production processes and proximity.
And the issue of what consumers really want from fashion and the shopping experience was tackled at an industry event last week. Not only do retailers need to offer value, quality and convenience, preferably all at the same time - but they must also engage with their customers online or in-store to make sure they keep returning.
For mass and luxury fashion brands seeking new markets, the Middle East and Africa is of increasing importance. While the region accounted for just 5% of total global apparel value sales in 2012, it was the second fastest growing region globally after Latin America.
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