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Kingshuk Sinha, a professor of supply chain management at the University of Minnesota’s Carlson School of Management, said what’s important to ask is “What now? What do we do differently?”
The worst thing would be for American retailers spooked about risks to their reputations to abandon Bangladesh, he said, which would be a humanitarian disaster for suddenly unemployed Bangladeshi garment workers.
What’s needed, he said, is what he called “true supply chain thinking,” leading to long-term relationships with vendors and a commitment to the vendors’ growth and success. It means sharing information and sharing risks and rewards. That approach has brought gains to workers in other countries.
An example is Nike, the sports shoe and apparel company. In the 1990s Nike was rocked by well-documented cases of child labor and other abuses at its vendors’ facilities, and its initial response — not my factories, not my fault — fueled outrage.
Nike then established a compliance effort and worked with factories in Asia on labor management and compliance, according to Drusilla Brown, associate professor of economics at Tufts University in Massachusetts.
“That’s a firm that has been really aggressive about trying to develop long-term relationships with its vendors,” she said. “Nike sees that as a strategy for protecting its reputation.”
There’s no reason why Bangladesh has to remain the wild West, she said. American retailers like Target can, over months and years, develop the Bangladeshi supplier base into far more reliable and capable manufacturers with better working conditions, and force the government to elevate its enforcement efforts, too.
That would be a pretty good story for Target to tell.