Week 6 Current Event:

Week 6 - July 14, 2013

Macy's Merchandising Group LLC

North American Alliance Launches Bangladesh Safety Plan

Summary

Recently, 17 North American retailers and brands released "The Bangladesh Workers Safety Initiative". Among the retailer executives who signed the alliance's pact was chairman, president and ceo of Macy's Inc., Terry Lundgren. This pact is a five year worker, fire, and factory safety policy that will provide 42 million dollars in funds to improve factory conditions in Bangladesh along with training factory workers and owners in safety standards. This initiative was created after the tragic Bangladesh factory fire that claimed more than 1,000 lives. "The initiative is built on five key elements: training, common standards, the expansion of buyer and safety programs, transparency and “sustainable financial commitments,”said Thomas Nelson, one of the pact signers.  The project will include 500 factories and is designed to strengthen a pre-existing fire and safety code created by European companies. The plan will give factory owners access to millions of dollars in loans to facilitate safety improvements and calls for safety inspections of all the factories in the first year of the agreement. In addition, the alliance will create a safety standard for all factories to abide by and will attempt to develop a partnership with the Bangladesh government to have all factories within Bangladesh under the safety standards. 

Co-Worker's Opinion

The brief summary of the article above is actually an interesting one, since I previously had a conversation with my boss and another product manager about Macy's relationship with Bangladesh factories. During a vendor meeting when this idea was brought up, the entire Macy's team went silent with awkward tension in the air. After a quick pause, the director spoke up and told the vendor that Macy's was still uncomfortable to work with Bangladesh and would prefer a company in a country without bad press. After the meeting I asked my boss why vendor's were pushing for Bangladesh. She responded with the fact that Bangladesh factories are one of the best places for vendors to meet our targeted first cost for clothing. The downside to using these factories though is the bad media that these factories have been receiving since the fire that claimed over 1,000 workers lives. As much as Macy's wants to lower the first cost and make a profit, its not worth losing our customers and degrading our reputation. 

After I confronted my boss again with this article and asked her opinions on the future of Bangladesh and Macy's, she took a few minutes to respond. I believe that I took her by surprise.  She then stated, "It is great that you are staying up-to-date on Macy's political campaigns. I was unaware of this initiative. I think it's great that we are tackling this problem. Since it is a constant fight to get the best deal and the lowest cost, we often forget the consequences to those making these goods. I hope that through this program, Bangladesh will benefit and grow along with inspiring other factory owners to improve their conditions. And if your information is correct, then I would assume in the coming months Macy's will begin sourcing with some of the factories outlined in the pact."

Citation/ Link 

Ellis, K. (2013, July 12). 

North American Alliance Launches Bangladesh Safety Plan

. Retrieve on July 9, 2013 from: http://www.wwd.com/business-news/government-trade/us-retailers-launch-bangladesh-factory-initiative-7048431?src=search_links