Sourcing in Eastern Europe – Looking At The Potentials

With sourcing in so-called low-wage nations like China, Pakistan, Bangladesh, and India encountering a slew of issues, including non-compliance with fire and safety requirements and low salaries, some in the industry are calling for a complete or partial pull-out. Looking at the Eastern European Sourcing market as an alternative is an option.

The Texmedin report claims that "In the last few decades, the TCL industry (TCL stands for textiles, clothes, leather, leather products, and footwear) in the current 28 EU member states has battled "slowly growing demand, low productivity, and strong international competition" and "ended up losing nearly one-third of jobs and production volume in the last 15 years”. It had to accept steadily increasing import proportions from low-cost countries, particularly China."

Apparel production takes a massive hike in Eastern Europe

TCL's EU strategy has been to divide orders between specialized production in countries offering better payscale such as Germany, the United Kingdom, Italy, and France, and mass manufacture in low-wage countries such as Portugal, Greece, Romania, and Bulgaria throughout the last few decades. "Mass manufacturing has virtually departed from high-wage countries in the EU," according to the research, "while areas offering lower pay scale – Portugal, the New Member States, and Greece - could retain at least sections of TeL production." Looking at the scenarios, these low-wage groups are probably the best country sourcing options in Europe.

The basic eight social criteria established by the International Labour Organization (LW) - zero forced labor, no discrimination, no child labor, worker freedom of association, fair wages, and so on - have not been without their own set of issues. In Europe, too, normal working hours, consistent employment, and humane working conditions are often ignored.

Even within Europe, there are huge wage disparities

"Wages, working hours, and employee health and safety are the most pressing issues in Eastern Europe. Another important issue in Turkey is freedom of association "Bettina Musiolek of the CCe (Clean Clothes Campaign) notes that minimum salaries are not always guaranteed, even in Germany or the EU.

So much for improved working conditions across Europe as a whole. To be fair, one must distinguish between trade and industry, as Wilfried Holtgrave, President, northwestern German textile and Garment Association, points out. "German textile makers who produce outside of Germany carry out in their companies or enterprises they know," he says. He agrees that "black sheep or companies that deceive their customers" exist from time to time, but he is certain that "this is not a textile problem, but something that creates issues in other industries as well.”?

Cheap garments come with a curse

The difficulty appears to be where dumping prices come in, rather than being industry-specific. When apparel is heavily discounted or sold in the market at cheap rates to compete, it is a guarantee that it will be manufactured where the smallest margins are available, whether in Asia or other areas of low-cost options in the United States. The result is the same: workers are the ones who have to pay the heavy price with their safety and health because meeting such criteria is still considered a "nice to have" and consequently unlikely.

Cheap T-shirt trades

When it comes to Eastern Europe sourcing options, the cheap t-shirts sold for around 3 euros may not bring a positive impact on the lives of the workers. Rolf Heimann, Hess Natur's head of corporate responsibility, explains why a fair-produced T-shirt cannot be marketed for three euros. "It's just not possible to go from the cotton plant in the field through trading, spinning, dyeing, knitting, tailoring, and then paying 19 percent value-added tax," he argues.

It is not fashionable to be cheap

Consumers, brands, and merchants should all be doing some soul searching. Is it true that cheaper is always better? Is it true that getting the best value for money means paying the cheapest price? Will buyers buy just based on price? Would they still be educated enough to invest a few extra euros if they knew they were making a good investment? Specifically, in long-term measures such as worker and factory safety, as well as the general well-being of individuals at the supply chain's bottom?

Your opinion matters

While issues such as these don’t show any sign to evaporate, since there is no quick fix, they do begin the ball rolling and, perhaps, lead to long-term transformation, not least in the mindsets of all parties involved. Finding the best country sourcing options is a need but not for the sake of humanity. Quality and Quantity both matter; how well the workers are paid has a certain impact.

Please express your opinions. We like to know about the mindset of the readers. What better ways are available to improve on the sourcing scenarios? Comment and we can start a discussion.?