Cheap and nasty: The ugly truth behind rock bottom prices

When we think about the true cost of cheap goods, we tend to think about the health implications of poor quality, mass produced food or the little wear we can get out of low-end, yet popular clothes we continuously purchase. The media has published numerous stories uncovering public health issues of heart disease and cancer caused by low-cost processed meats and fast food, as well as reports around our appalling throw-away culture.

But there is another story behind the discounts and offers on the shop shelves. A story about the murkiest corners of the UK’s £339bn retail industry where the human cost of keeping it going is high. A story many of us choose to ignore.

Low-paid, temporary workers in Britain’s fields and factories are being exploited in order to meet supplier demands, who in turn answer to the retail giants. One recent example being Sports Direct, who came under fire due to workers ‘not being treated like humans’ and working in conditions similar to a ‘Victorian workhouse’.

Manufacturers like Sports Direct are part of the unstoppable cycle of the UK’s retail industry. Many British consumers have had to make cutbacks to their shopping budgets, rethinking what they can afford to buy in the light of sharp increases in price inflation. Retailers driven by consumer demand and their own threat of competition (e.g. from cheap giants such as Aldi and Lidl), find ways to push down their prices whilst protecting shareholder profit.

Instead of bearing the squeeze at the retail end, the pressure of maintaining (if not increasing) production for a share of less margin is channelled down the supply chain. Way down. To the very lowest paid workers who have no choice but to accept the unacceptable. With every step in the process fighting for survival, it is impossible to isolate a single root cause of the problem.

The prevalent zero hour contracts which companies commonly use to employ a mass of workers on disadvantaged ‘flexible hours’ with no real security or worker rights have been coming under fire for heading towards modern slavery. Far from any guarantee of work, zero contract staff are notified at the last minute - even after having arrived onsite - that they are not needed that day. Paying workers by the hour is one way for companies to pay a less-than-minimum wage to its workforce, and it’s not right.

Mistreatment of workers in the attainment of business profit is sadly not confined to Britain. Modern day slavery comes in many forms around the globe, not least in Asia where people are forced to work in the production of seafood for no pay, for years at a time, under the threat of violence. People are literally “sold like animals” to work against their will, making produce that will be sold in supermarkets around the world, including the UK.

In the garment industry, the true cost of ‘fast fashion’ is more widely reported, particularly after the collapse of the Rana Plaza factory in 2013. According to War on Want, many workers in Bangladesh are forced to work 14-16 hours a day, seven days a week and only earn the equivalent of £25 a month – which appallingly works out to be 5p an hour. Workers face unsafe, cramped and hazardous conditions which often lead to work injuries and in numerous cases, death, just to produce cheap clothes for British consumers.

Herein lies the high price of cheap labour - people treated as unequal human beings, paying the penalty for consumers saving their hard-earned pennies and retailers paying their shareholders. The growing concern of slavery on our doorstep in Britain is a subject we have been monitoring for some time and are keenly focused on improving.

By working together, we can tell a different story - one where the primary goal of the industry, consumers and government is to provide fair working conditions. From that starting point, improvements can be made, business models changed, contracts revised and profit better distributed in the value chain.

With tools such as our ethical supply chain assessment, retailers can gain insight into what is happening beyond the processing level. Better informed operations through worker intelligence is a top priority for the UK suppliers we are working with to identify and eradicate forced labour and unsafe working conditions in the supply chain, and meet the UK’s latest Modern Slavery Act regulation.