Did you catch John Oliver’s tirade on apparel industry supply chain practices? In a segment of his show that aired earlier this week, the case for supply chain risk management and visibility investments was made by an unlikely source. The popular TV program’s scathing indictment of the supply chain practices of the likes of H&M, Walmart, Nike and the Gap is, in and of itself, proof of the brand risk associated with complex globalized supply chains.
Oliver asked how is it that companies can charge as little as $4.95 for a dress (comparing that to the $5 price point of a jar of cricket food) and yet still be “massively profitable.” He then proceeded to trace the roots of incredibly cheap apparel to exploitative labor practices and working conditions in developing countries.
“Sweatshops aren’t one of those 90s problems we got rid of, like Donnie Wahlberg,” said Oliver. “They’re a 90s problem we’re still dealing with, like Mark Wahlberg.”
And, despite increased monitoring, worker age verification, safety and other measures companies claim have been implemented, the problem arguably has only gotten worse as a result of the accelerated pace of globalization. As late as 1990, 50% of the clothes consumed in the U.S. were manufactured domestically; today it is less than 2%, according to an individual interviewed in the segment.
Oliver then adroitly put his finger on the role of supply chain visibility (or lack thereof) in driving company behavior and practices, and in doing so made the case for multi-tier or sub-tier supply chain visibility.
“One of the biggest problems in holding many brands accountable is that deniability seems to have been stitched into the supply chain.” He then explained a scenario in which Walmart sent an order to an approved apparel factory that sent it to an unapproved (subcontractor) factory without Walmart’s knowledge. He proceeded to chide Walmart for portraying it as just a “crazy, one in a million, random accident that only happened a few times in the last few years.”
“This is not the last time that Walmart has been caught unaware,” he continued. "And they are losing the right to act surprised. They’re like the characters in the Hangover movies. It’s not an accident the third time, boys. It’s a pattern of reckless behavior that has to be addressed."
In an attempt for greater transparency, Oliver recommended that some companies change their names. He suggested, for example, that American Eagle change its name to “Bangladeshi Swamp Hen.” He was OK with Banana Republic, however.
There are a lot of good reasons to invest in supply chain visibility as part of your supply chain risk management and corporate social responsibility (CSR) strategy. John Oliver, by his own admission, is not pointing out anything new. In fact one of his main points was that CSR, vis-a-vis the supply chain, is an old issue and we should have made more progress by now. He was just using his platform to keep the pressure on. Well done John Oliver. There are now two TV shows you definitely don’t want your company to be featured on: 60 Minutes and Last Week Tonight.
Looking to get ahead of this issue? Here's a good place to start: