May 7, 2013

Response to collapse poses risks for retailers

By KAY JOHNSON/The Associated Press

(Continued from page 1)

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Firefighters try to douse a garment factory fire in Dhaka, Bangladesh, last year. After a series of fatal incidents in the industry there, experts say businesses that sell clothing need to help eliminate work hazards to protect their images.

The Associated Press

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Companies that are downplaying involvement in Bangladesh's factory safety problems may be counting on the short memories of Western consumers, who tend to focus on price and may not even check where a piece of clothing has been made. But that's a risky strategy, said Rahul Sharma, public affairs executive with the India-based public relations firm Genesis Burston-Marsteller.

"Reputation is built over a long period of time. But to lose it, it can take seconds," Sharma said. Even companies that do make efforts to ensure they use only factories with good safety records are now at risk of being lumped in with the problems that are rife in Bangladesh's garment industry, he said.

Sharma said that if he were advising any retailer doing business in Bangladesh, he would recommend swift action in the form of a concrete plan to overhaul the entire industry, working with government, factory owners and labor unions.

"They need to send out the message that they are addressing this problem - and then they need to actually do it," he said.

In the wake of the Rana Plaza collapse, there have been tentative moves to do that. Last week, the Bangladeshi garment association met with representatives of 40 garment buyers including H&M, JC Penney, Gap, Nike, Li & Fung and Tesco.

Others have called for retailers and brands to now embrace a union-proposed plan for all retailers to fund factory upgrades and independent inspections that would cover the entire industry in Bangladesh.

That plan has previously been rejected by all but two major brands as too expensive for the corporations and Bangladesh's responsibility to fix its own problems. PVH, the parent company of Calvin Klein and Tommy Hilfiger brands, and German retailer Tchibo were willing to sign up.

But with the latest disaster, a potential loss of reputation could be far more expensive in the long run.

"There is a perception when something terrible like this happens, that crisis communication is going to fix it," Sapriel said. "But no, no. You have to go and fix the problem. And then, only then, can you can communicate that you've done something to fix the problem."

 

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