Earlier, Lost Stock, a UK scheme that repackages garments from cancelled western orders seemed to be a good idea to deal with unsold inventories. However, recently experts have been questioning the scheme’s efficacy as it not only burdens consumers with the responsibility of rescuing unemployed workers but also enables retailers to exploit contractual loopholes to deny payment, demand heavy discounts or compensation on completed and in-progress goods commissioned before the viral outbreak.
The scheme has proved more popular than was anticipated. However, not everyone is convinced about it. Mostafiz Uddin, Owner and Managing Director, Denim Expert, a jeans manufacturer in Chittagong, Bangladesh disapproves of the scheme fully. He feels factories are forced to sell surplus goods to Lost Stock because they have no other option. These goods are sold at highly discounted rates to get rid of the manufacturers’ huge bank liabilities. The payment received from their sale does not cover the total value including raw materials, worker wages, storage costs and bank interests.
The scheme negotiates a cash price with each factory in Bangladesh. This amount is further supported by financial assistance from the
Sajida Foundation. When combined together, both these payments aim to exceed the originally agreed rates with retail brands.
No solution for core issues
Ayesha Barenblat, Founder and CEO, Remake believes, Lost Stock is an interim charitable act that doesn’t deal with the core issue of suppliers not being paid for their work. She believes the scheme offers a short-term hopeful solution of clearing up some of the inventory and getting immediate relief to workers. Though it allows consumers to feel good about their efforts for the garment workers, it does not shield them from unrelenting buyers.
The garments sold by Lost Stock are attached with the organization’s tag, which further obscures their origin and reason for being sold. Christie Miedema, a Clean Clothes Campaign advocate points out this conveys a wrong idea to brands that they can shop their way out of the crisis and responsibility for solving it lies with consumers. She affirms brands shouldn’t consider the work of garment workers as charity and pay them accordingly.
Aiming to change consumer behavior
Cally Russell, CEO of online retail platform Mallzee views Lost Stock as part of a broader movement that targets consumers from different backgrounds and different types of belief systems and approaches to action. She hopes in the long term, the scheme helps people deal with problems created by some of their previous choices.
Lost Stock recently launched a children’s version of its box. The scheme has even bigger ambitions for the future and plans to create something that would change the way people buy products. However, labor advocates, like WRC’s Nova, believe that the only way to protect the rights of the workers is to compel brands and retailers to fulfill their obligations.
