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December 04, 2007

Comments

Marie-Eve Allaire

Hi Harvey,

This is very interesting!
I have two questions for you:
You say that : « the wages are less than 7% of Canadian minimum wage. But relative to "life" in the developing world, it's not bad.» How can we compare that, is there any tools to compare the quality of our life according to the price of goods etc. ?
People could have hesitations to trust the company who made this survey because it's a chineese comapny. How can you trust that they are not «controlled» by the government? Why did you not choose a company from an other country?
Please be sure that I don't want to denigrate this approach, I'm just questionning.
Thanks.

C Jones

Ok? What is your point?

Are you planning on firing the plant? Or perhaps insisting that the plant fire the manager?

This full disclosure thing has responsibilities attached.
1) You must assess if it is relevant to disclose this info about your business operations.
2) If so you think so, please explain why.

Personally, I note a rising hysteria about manufacturing in China which doesn't quite gibe with people's behaviour. Everyone want cheaper goods AND better quality controls. That is contradictory.

AS to "worker comments" - don't raise expectations that you can't satisfy or meet. Solving this management problem is something that has to be done by both parties. Chinese are notorious for not "washing their laundry in public" and I dare say this kind of action will not go down well. In fact I'll even wager that it wouldn't have been well received in NA had you done the same thing (if you still have plants here).

Regards, crj

HC

Hi CRJ,

Thanks for the note. The point of this is to give some additional insight to what workers are experiencing. It's an on-going piece on "Connecting with Workers".

You're right. Anytime we meet with workers, expectations are raised. It's difficult to avoid this as the entire objective of social compliance or ethical sourcing is to improve work conditions.

MEC will never knowingly disclose the identity of a factory as it relates to precise issues within that facility. Simply because it contravenes business etiquette, confidentiality and possible libel laws.

Cheers

HC

Hi M-E,

Yes, there are economic indicators that attempt to compare standards of living across countries. Grab an Economist Magazine and on the last page there's this Big Mac index that attempts to look at what a Big Mac will cost in Canada, China and elsewhere (all denominated in US$). Or google the UN Development Report and it attempts to compare standard living across countries.

There are so many companies in China that the Chinese government only cares if the company agitates for political change. The Chinese government on the whole, leaves them alone. (Maybe different for high tech.

Many local Chinese have told me that they can do almost anything (like us) with the exception of agitating for change at the political level. But once you cross that line, you will be monitored. Otherwise, you're mostly left alone.

Thanks


Alain Saffel

I would like MEC to try to source its products outside of China, a notorious abuser of human rights. I would be willing to pay more to have products made in North America, like my Serratus backpack, that once was made here, if I remember correctly. MEC shut it down, sadly.

There is a big concern over the safety of Chinese products as well. What is MEC doing to address those concerns in the products it imports?

I'd like to applaud MEC for suspending sales of bottles containing BPA.
http://www.cbc.ca/health/story/2007/12/07/bisphenol-mec.html

Any other chemicals we might want to be aware of?

Mike

"We engaged a Chinese based consulting firm to help us better understand the mind frame of factory workers... In many ways they're just like us."

- condescending, paternalistic, typically Eurocentric.

HC

Hi Mike,

You mean Canadiancentric.

We are not a European based entity.

Cheers

HC

Hi Alain,

Thank you for your thoughts.

To understand why we source in China check out my comment at http://blog.mec.ca/2007/09/the-man-with-th.html

MEC will keep its members informed about any other hazardous chemicals.

In terms of product quality, MEC has a quality assurance department that monitors the quality of products coming to our stores. In addition, for MEC branded apparel, MEC actively inspects the product, often at the factory, before it is released in our supply chain.

Thanks for your comments.

Wintermute

What does "Remuneration approaches legal standards" mean?

Mark

"Remuneration approaches legal standards..."

Can you imagine working for less than minimum wage?

If it is not at a legal standard in a country with notorious human right violations... that sounds pretty bad to me.

Instead of using MEC's tax breaks to undercut locally owned stores in Vancouver, couldn't you pay a LEGAL wage?

Thanks, Mark

HC

It means in some areas they are meeting minimum wage standards or required benefits.

HC

Hi Mark,

Thanks for the note.

The vast majority of factories in the developing world who make what you and I buy at MEC, department stores, hardware stores, sporting good stores, supermarkets, electronic stores and etc., are not meeting the pay and benefit requirements of their host country.

You're right. It's very bad.

We also suspect that a certain portion of our Canadian contract factories are not paying strictly according to provincial laws.

The reason for this is the majority of stuff we buy is made by low to semi-low skilled disenfranchised workers who take what they can get. They take what they can get because retailers (MEC included) historically didn't know, didn't care or didn't bother to deeply investigate it. MEC is realizing this and is figuring out what to do.

Now it's not just the retailers fault for letting this happen. You and I, the consumer are sharp shoppers and on this boxing day, we'll travel a great distance to find the best price deals. These price deals symbolize a greater consumer fixation on pricing which hammers worker wages. This sounds pretty bad to me.

The question I pose for you and every consumer is would we pay more for an item that truly reflects minimum pay and benefits? And if any retailer out there, a local or a global chain, that sources from the developing world and who believes that their supply chain is whiter than white, is soundly deluded. Just check out the Fair Labour Association or any international union for garment workers to understand the reality of factories.

Everyone us contributes to the economic disadvantages of factory workers. You and me included.

HC

Mark

My question though is, because of MEC's Co-Op status, I'm led to believe it recieves tax breaks, which is what allows MEC to sell the same, or comparable, products for less then neighboring local stores. As does buying in larger quantities.

For example, a MEC bicycle inner-tube costs 3$, while any local bike shop charges 5$. If MEC charged even 4$ per tube, that extra 1$ would go a looong way for the producer of it, and still being the cheapest tube in town.

If MEC's first values were in fair trade and sustainable products, and less motivated by profit, it may be less financially successful, but it would be more ethically rich. At what point is it successful enough and can return the profits as fair compensation? Its already "Canada's leading supplier of outdoor clothing and equipment."

If I see MEC as no better than a local bike shop, my only ethical motivation will be to support the locally owned shop.

I think this blog is great, and really appreciate that you made it happen to increase transparency. Hopefully the discussions on here are more than just PR.

HC

Hi Mark,

Thanks for the valid thoughts.

You're right. Maybe MEC can charge a bit more to see a more even distribution of "wealth" to the people who actually manufacture the gear. This is something that has been very loosely discussed. But before we even get to the point of actually executing this, we would have to develop a sound financial model with plenty of facts that demonstrate the discrepancy in pay amongst workers.

An ex-product manager/buyer named Greg did some great work on one factory on this matter, where we actually quantified the price increase to make wages meet local laws.

MEC's financial model is based on gross margin of low 30's on product. It's mandate is to get good gear at affordable prices to members, so these individuals can "play" in the wilderness. Any significant changes in price to reflect your thoughts would impact our mandate and business model.

MEC's goal is to reflect the values of its members. If it's actions deviate from the norm, members can effect change by getting themselves elected on the Board or by using market forces (e.g., shop at a more suitable location).

Thanks for your valid thoughts.

Cheers

Rick

There is an interesting documentary on the Knowledge Network called "China Blue", if you didn't see it on Monday at 9:00 PM, it is repeated on Friday February 15th at 11:00 PM PST. I recommend that you have a look at it if you can, since it addresses some of these questions.

As a long standing member of MEC, I think that all our Co-op members should be aware of these important issues.

HC

Hi Rick,

China Blues is part drama part documentary.
It's a must see.

Thanks for note.

bob

this blog is hard to read cuz its chronologically backward! most blogs are chronological down the page - had a hard time following .... -Bob

Cary Glenn

"The living costs are rising rapidly. The wage level here is really too low. I hope the factory can increase wage.
(W)orking hours start at 7:30am, but workers must arrive at the factory at 7:10am. The factory takes too much time from workers.”
This comment is interesting. I worked at the Edmonton MEC store and the wages did not match the cost of living increases. It was expected that we show up 15 minutes early, and we were talked to if we were not there early. We were also expected to stay late to help a member. We were never paid to be there early and very rarely were we paid extra if we stayed late. To get paid for that extra time involved finding a senior staff and having them approve of the extra time. This could take more than 15 minutes. This extra time could add up to hours of upaid work every month. Let's just say that this was one of the many problems at the Edmonton store.

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