08 Jul 2020
Posted in Retail
boohoo allegations mark a turning point in fashion’s transparency problem, says GlobalData
As the boohoo group faces allegations of modern slavery in a supplier’s factory in Leicester, ASOS, Zalando and Next have removed products from its brands.
Emily Salter, Retail Analyst at GlobalData, a leading data and analytics company, offers her view on this news;
“Though questions about boohoo’s ethics have not hindered its impressive growth previously, this allegation is more likely to make an impression on shoppers due to its location and occurrence during a time when retailers’ actions are increasingly under scrutiny. The demand for cheap fashionable clothing will not disappear but the press coverage and actions resulting from the allegation could have long-lasting impacts on transparency in fashion.
The decision by stockists, ASOS, Zalando and Next to pull the boohoo brands’ products from their websites is a bold move, but the right one to send a clear message to consumers that they do not endorse such practices. As these retailers stock hundreds of brands, they do not stand to lose much from this, whereas boohoo has lost its main wholesale partners, impacting its sales.
This morning, boohoo announced that it is launching an independent review of its UK supply chain in an attempt to mitigate the damage, concluding in September. But it will need to take faster and more decisive action than this to persuade its wholesale partners it has made the necessary changes, and to convince consumers that it operates ethically.
Though this specific incident is important, it points to the wider problem of the lack of transparency in the supply chain that is endemic in the fashion industry. Despite retailers having plenty of other problems to deal with amidst COVID-19, this high profile slip up will accelerate their efforts towards transparency, under pressure from consumers and investors.”