Predatory purchasing practices in global apparel supply chains and the employment relations squeeze in the Indian garment export industry

AuthorMark ANNER
Published date01 December 2019
DOIhttp://doi.org/10.1111/ilr.12149
Date01 December 2019
International Labour Review, Vol. 158 (2019), No. 4
Copyright © The author 2019
Journal compilation © International Labour Organization 2019
* Pennsylvania State University, email: msa10@psu.edu. The author is grateful to the
many individuals and institutions who made this article possible. The surveys were conducted
by Cividep and its team in Bengaluru and by Amit Kumar, Joshi Brijlal, Devendra Singh and,
most especially, Rubina Khaliq in the National Capital Region. The Apparel Export Promotion
Council provided contacts and facilitated access to supplier factories. Madhumita Dutta was a
steady source of support. The author also deeply appreciates the feedback provided by Cividep,
Dev Nathan, the anonymous reviewers and the editorial team at the International Labour Re-
view. This project was made possible thanks to the generous support of the Ford Foundation,
India. The author is particularly grateful to Srinivasan Iyer of the Foundation for his insightful
and strong support and encouragement.
Responsibility for opinions expressed in signed articles rests solely with their authors,
and publication does not constitute an endorsement by the ILO.
Predatory purchasing practices
in global apparel supply chains
and the employment relations squeeze
in the Indian garment export industry
Mark ANNER*
Abstract. While the literature has long acknowledged worker rights abuses in
global apparel supply chains, less attention has been paid to the recent worsening
of certain decent work decits and its causes, which this article links to predatory
purchasing practices arising from growing power asymmetries. These practices,
illustrated here by the garment export industry in India, exert downward pressure
on wages and incite non-standard forms of employment and greater verbal and
physical abuse as productivity demands rise. They can be addressed through pri-
cing mechanisms that cover the cost of decent work, appropriate State regulation
and worker involvement.
The promise of development and decent work via insertion in global
apparel supply chains has proven elusive for workers in many devel-
oping countries (Selwyn, 2017). Many countries that turned to export-oriented
growth strategies have been stuck in low-wage and low-development ruts for
decades (Milberg and Winkler, 2013). In the case of India, while the value of its
apparel exports increased from US$3.1 billion in 1992 to US$17 billion in 2017
(making it the fth-largest apparel exporter in the world), garment worker
wages, by one estimate, cover only 23 per cent of living expenses (Worker
Rights Consortium, 2013, p. 108), and patterns of forced overtime, work inten-
sity and various forms of contingent work all appear to be on the rise.
International Labour Review706
This article argues that, as a result of growing power imbalances in global
apparel supply chains, buyers seeking to maintain or increase their market
share are having greater recourse to predatory purchasing practices, using their
leverage over suppliers to demand lower prices, quicker speed to market, and
abrupt changes to order specications. In response, suppliers squeeze wages,
increase workers’ production targets and often subject workers to verbal abuse
when targets are not met, demand extensive overtime work during peak pro-
duction cycles, and turn to non-standard forms of employment that allow them
to keep costs low and quickly adjust workforce allocation needs. Addressing
these dynamics requires pricing mechanisms that cover the full cost of decent
work, respect for fundamental workers’ rights, safe and healthy workplaces,
and an end to violence and harassment at work.
These considerations are examined here via a case study of the garment
export industry in India, specically the Delhi and Bengaluru areas. The data
used for this article were compiled from eld research, stakeholder interviews
and original surveys of supplier factories and workers conducted in 2017 and
2018. Trade data for Indian exports to the United States and the European
Union were also examined, to establish pricing and sourcing trends over time.
The article is organized as follows: the rst section reviews the literature on
power asymmetries in global apparel supply chains and develops the argument
and model; the next section outlines the methods used; the third section pro-
vides an overview of apparel export production in India and details the study’s
ndings; the nal section discusses the possibilities for transforming purchas-
ing practices through pricing mechanisms that cover the cost of decent work,
more stable production contracts, better regulation in home and host countries,
and empowered worker involvement.
Predatory purchasing practices in global apparel
supply chains
The literature on buyer-driven global supply chains indicates varying degrees
of power imbalance between buyers and suppliers (Anner, 2018; Bair, 2009 ;
Geref, Korzeniewicz and Korzeniewicz, 1994; Selwyn, 2015; Taylor, Newsome
and Rainnie, 2013). The greatest power imbalance was initially assumed to be
in buyer-driven global value chains such as those found in the apparel indus-
try, because large brands and retailers were seen to have considerable lever-
age over the relatively small, numerous and geographically dispersed suppliers
(Geref, 199 4). However, it was subsequently argued that as suppliers took on
more tasks (sourcing fabric, cutting patterns, etc.) they increased their leverage
vis-à-vis buyers, thus reducing the power imbalance (Geref, Humphrey and
Sturgeon, 2005). In contrast, this article argues that even though suppliers are
coordinating more tasks, power imbalances have been exacerbated by buyer
consolidation and nancialization. It also argues that predatory purchasing
practices promote recourse to non-standard forms of employment in global
supply chains, as they exert downward pressure on wages.

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