South-Western - Management  
The Goal: 'Sweatshop Free.' The Problem: Defining It
Topic Managing Service and Manufacturing Operations
Key Words Outsourcing, unions, social responsibility
News Story

Some companies have become concerned that consumers believe all garments are produced in sweatshops. This idea may have come from news reports of big name manufacturers who have had negative stories about their business practices. So some businesses have chosen to market and promote the fact that their employees are producing apparel in healthy environments.

Some companies market this feature by producing a catalog with a photographic essay of immigrant sewers and cutters at work, by hiring only union workers who receive a share of company profits, and by listing names of factories that it uses.

Some companies believe in vertical integration: all aspects of the company operate under one roof, thus costs can be controlled and quality can be supervised. As a result of this cost saving measure, one company was able to offer better pay. The average hourly wage was $12.29, and the minimum was $9.

Not all companies can use vertical integration. Some companies must outsource processes. They assure consumers that they do so only to union shops in the U.S. and Canada so they can claim "the union label as the ultimate standard of sweatshop-free apparel." However, the union label comes with a price tag. Not all companies can afford union labor. Only 11% of America is unionized. Demanding a union-only label on clothing will limit the growth of no-sweatshop clothing.

Even so, the push to promote the union label continues. In November, Mr. Neiman of NoSweatApparel started a website. is a virtual mall where vendors sell goods that are made exclusively by union workers.


Why are these companies so intent on being "sweatshop free?" What are the advantages and disadvantages to a company of going this route?


Go to What types of claims are the vendors making about their clothing? What proof do they offer to substantiate their claims?


What is the relationship between union-only and sweatshop free? What are some other ways a company can prove it is sweatshop free?

Source "The Goal: 'Sweatshop Free.' The Problem: Defining It," The New York Times December 14, 2003.
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