Extreme pricing. At what cost?
Take a few moments to browse fashion retailer Joe Fresh's crisp, minimalist website and you might just succumb to sticker shock. For once, it'll be because you can't remember the last time you saw a pair of jeans this cool for $19.
Old Navy charges $34.50 for their incarnation of this season's colourful denim trend, and they do so without Joe Fresh's cachet as the fun new kid on the fast fashion block.
The brand is the brainchild of Joe Mimran, perhaps Canada's best known merchant and the co-founder of Club Monaco, which he sold to Ralph Lauren Corp. in 1999. In 2004, Mimran was hired by Canada's second richest person, department store billionaire Galen Weston, to develop a clothing line for his supermarket chain Loblaw Inc. Since its 2006 debut, Joe Fresh has grown far beyond the confines of supermarket aisles into a household name, with over 300 stores in Canada.
The chain's US presence is also growing exponentially, mainly thanks to a partnership with JC Penney. There are Joe Fresh boutiques inside almost 700 JC Penney outlets across the country. Such is the cross-demographic appeal of the brand that there are also brick and mortar Joe Fresh stores in prime retail territory like Manhattan's Fifth Avenue. When the company's flagship US store opened in spring 2012, Mayor Michael Bloomberg dubbed Joe Fresh “the greatest Canadian export since Justin Bieber”.
In a video on the Joe Fresh website, Mimran describes the company's “extreme pricing” as one of its selling points. This week, the cost of that extreme pricing was called into question when a Bangladesh textile factory that manufactures Joe Fresh clothes collapsed in what is certainly the worst disaster in the history of the garment industry. The death toll is nearly 400 but could rise to over 1,000, with hundreds missing amid the rubble.
The Monday after the deadly collapse of Rana Plaza in Savar, Bangladesh, Joe Fresh parent company Loblaw joined fellow retailers Sears Canada and Wal-Mart Canada at an emergency meeting of the Retail Council of Canada to discuss how to combat working conditions in sweatshops.
Loblaw announced it would be sending representatives of its supply chain team to Bangladesh to investigate the collapse of the building, which also housed suppliers manufacturing clothes for British chain Primark and Italy's Benetton. The company posted a statement on its website on Monday saying it'd offer compensation for families of victims killed when the shoddily-constructed building crashed down. As the death toll ticks upwards, it remains to be seen what exactly Joe Fresh will accomplish in Bangladesh. The company faces rampant corruption at every level of government, trickling down to the garment factories, policed by thugs who threaten workers with docked wages if they don't work brutal 13- or 14-hour shifts, often seven days a week.
“These workers were mostly young women, and they were ordered into that factory,” said Charles Kernaghan, director at the Institute for Global Labour and Human Rights, a nonprofit lobbying for workers' rights with an office in Bangladesh's capital Dhaka. Kernaghan visits the country on average three times a year and has interviewed Savar factory workers in their homes.
“They didn't want to go into work as there were already deep cracks in the walls the day before,” he said. “They were driven into that building by people with clubs waiting to beat them up --gangsters and goons. They went in at 8:00am and the building collapsed at 9:00am.”
Kernaghan doesn't blame Joe Fresh or any of the other companies with suppliers in Rana Plaza for the building's collapse. But he doesn't buy that these Western retailers could've possibly thought all was well in that facility.
“How did they not know these factories were illegally made, with three extra floors shoddily added?” he asked. “Did they not know about the fire in Tazreen in November, where 117 people died, mostly women? Nobody going into Bangladesh is naive. The only reason they're there is so they can pay almost nothing. It was a death trap.”
Kernaghan added that Joe Fresh and other retailers with links to the Bangladesh tragedy will face “enormous pressure” to overhaul their supply chains and investigate the rights of workers in the Third World factories they employ to manufacture their clothes on the cheap.
“Joe Fresh has enforceable laws to protect their trademark,” he said. “There needs to be a similar law to protect the rights of the worker. The label is protected. The worker is not.”
He doesn't hold out much hope for an overhaul of the garment industry in Bangladesh anytime soon, citing the 2012 murder of labour activist Aminul Islam. Two years before that, workers went on strike, but were beaten, attacked, and shot with rubber bullets by police.
Their gripe? Whey wanted a raise, up to 30 cents an hour from 26 cents, to make your $19 pair of jeans.
The article has been taken from www.forbes.com