The Industry Interview – British Factories and Ethical Compliance
After the media frenzy surrounding Boohoo and unethical factory practices taking place in Leicester our CEO Jenny Holloway has been asked to comment in various articles / interviews. Her response was not to finger point or blame but to try and work together she said: “retailers and factories need to work as one; when the buyer realises the skills of the factory and they are respected; when there is set on-going production so the factory can plan ahead, offer decent wages for a stable workforce and not operate in a climate of fear.”
Jenny’s views were recently featured in an article by Lauretta Roberts for The Industry. Fashion website. Jenny was one of four experienced industry experts asked to comment.
Here is Jenny’s excerpt from the article:
Jenny Holloway is CEO of Fashion-Enter, a not for profit, social enterprise, which strives to be a centre of excellence for sampling, grading, production and for learning and development of skills within the fashion and textiles industry. The London factory was established in 2010 with support from ASOS, which remains a client along with Marks & Spencer and John Lewis.
As an ex Senior Buyer from Arcadia and a buyer from M&S, I always knew how important it was to have deep foundations for our ethical factory. I knew about ethical compliance and understood about policies and processes, but I certainly didn’t understand how important it was to bed these policies into a business, so they are the very life and soul of the factory.
I feel for all factories because as a white middle aged degree-holding CEO that has a team for ethical compliance we can keep up to date with the latest requirements for auditing for both Fast Forward and for SMETA and it’s a hell of a lot of work. It took us years to be fully compliant too so how hard is it for factory CEOs whose English is a second language? How hard is it to really embed a policy when actually they are worried about the what work they have coming in next week to pay the bills?
Covid is just one of a string of issues that makes fully compliant garment manufacturing difficult in the UK; of course it can be done and we are living proof but the truth is there is not consistency of work and those weekly and monthly variations of feast or famine with production creates a complete nightmare for manufacturers.
So that expression “when the sun shines make hay” really is attributable to the garment makers. When orders are flowing because the sun is shining it’s a brave manufacturer that will turn down work because in a few weeks’ time, when there is a wet summer, when the latest press adversely hits sales, or there could be another Covid spike, there is no work, yet the machinists still need their pay, the utility costs still have to be paid and rent and rates are a killer (especially in London). Then of course there’s the HMRC costs of VAT, PAYE, Pensions, NIC – it’s a totally transient business with little stability of forward orders.
I still hark back to the days when I was at M&S and we had the great powerful suppliers of SR Gent, Bentwood, Claremont and Bairdware. These big boys were equally as Herculean as the merchandise managers and execs and actually they were respected and treated with reverence. Their factories, in hindsight, were positively awesome; fully compliant in every way with a workforce that was proud of their craft to be a stitcher. There was always succession planning too with daughters following their mothers.
Today with more scandals of sweat shop factories yet again our wonderful garment making industry is having another knocking, but you can’t blame it all on the manufacturers. Yes of course there are rogue factories out there that are exploiting, but in every sector you get these rogues but, actually, they are not the norm. The norm is more of a hard-working CEOs working six days week when the sun is out and worrying when the rain comes how they are going to keep their workforce together.
The workforce know their strength, especially after the gates closed with migrant labour from EU, and they know that they can pick up jobs easily too. Then you have the workforce that expect to be paid 16 on the books and 16 off the books i.e. cash so they can carry on receiving their benefits. The recent allegations of undercover reporters have again highlighted this, but it really does not have to be like this.
That reporter would not have been asked for RTW – Right to Work Documentation. That’s the first major step in compliance. The worker categorically should not have been paid cash and should not have been in the building, but I can how this has happened. Peak capacity and the orders have to come out on time otherwise a cost price reduction will be imposed by the retailer. Factories do not make big margins, so any cost price reduction is a killer. So, when someone comes along and accepts £3.50 an hour without paying tax and all the other HMRC commitments you can understand why that CEO says yes. Of course, it’s not right and I don’t want my words twisted here but you can see the panicking CEO thinking “I have got to get that order out on time – it’s another extra pair of hands”.
It’s wrong and it has to stop and the only way it will stop is when the retailers and factories work as one; when the buyer realises the skills of the factory and they are respected; when there is set on-going production so the factory can plan ahead, offer decent wages for a stable workforce and not operate in a climate of fear.
We spent at least three years making our factory work correctly with deep solid foundations and in that time it was ASOS that supported us and beared with us while we made mistakes that we owned up to. Being an ex-senior buyer I can see both sides of the equation and we are in a lucky position to have an on-going honest relationship with ASOS that we work with. This is what all factories need and it’s time that all retailers woke up and smelt the coffee beans – the UK is amazing. It has so much to offer with speed of response production but do treat the factories fairly and honestly and driving the price down to the bottom of the glass is just one quick way of driving a factory down to unethical practices.
With a third of the market value wiped off for Boohoo due to the Leicester allegations isn’t it the time now for retailers to work hand in hand with factories or better still open your own?
Click here to read The Industry’s article: ‘Leicester and the Boohoo bombshell: what can UK manufacturing do to move forward?’ By Lauretta Roberts, published on 15th July 2020.