ANSWER THESE QUESTIONS ACCORDING TO THE CASE STUDY BELOW AND PLEASE PUT REFERENCES

1. What is the underlying cause of poor working conditions for supply chain workers?

2. Why do you think the recommendations you have made will be effective in solving these issues?

3. Why do you think the actions you have recommended have not yet been used and applied across the sector already?

Case Description:

XYZ is a fast fashion brand having AUD 121 million revenue and AUD 14 million profit in 2021. Young adults are the primary target market market share is growing steadily due to trendy style. Before COVID the brand was expanding its operation both online and brick and mortar. The brand primarily sources from Bangladesh and Vietnam through agents. However, as a growing fast fashion brand, they are increasingly under pressure to showcase their ethical business practices, publish the factory list and ensuring workers in their supply chain have safe working conditions and are being paid a living wage.

Due to COVID lockdown the director of sourcing and the director of sales and marketing at the company decided to stop all ongoing orders from the supplier factories, to delay shipment of ready products from those factories, to delay payments to factories, and to cancel some orders altogether as well. These decisions were made without proper risk assessment or consultation with the sustainability manager. The sustainability manager only came to know about these decisions through emails.

When supply chain factories were informed about this decision the factory management, particularly in Bangladesh, were very unhappy and reported this to media. The issue became huge as factories could not pay the workers and had to reduce the workforce, laying off staff. Worker protests led to vandalism, arrest, and in the process one worker died. The factories blamed the brands for the situation, they named XYZ brand in particular for having very poor purchasing practices.

Australian media picked up the news and consumers are unhappy, expressing their dissatisfaction and deep concern in the social media, and some of them are calling for a boycott of XYZ. Competitors of the XYZ have taken the opportunity to promote their brands, claiming that they have paid all existing orders in full and did not cancel any orders due to COVID.

XYZ needs to respond quickly - the company created a team consisting of sustainability, sourcing, media and marketing managers to propose a next course of action to salvage the situation. The management is very concerned as a big meeting with key investors has been scheduled in a months time. Investors would like to see not only a crisis management strategy, but also a comprehensive plan to retain confidence in the company.

*** I WILL GIVE A THUMBS UP IF THE ANSWER IS RELEVANT AND SATISFIED THANKYOU SM!!