The document summarizes key events in 2013 that highlighted social accountability issues in global supply chains, particularly in Asia. The Rana Plaza factory collapse in Bangladesh that killed over 1,000 people and a factory fire in China that killed over 100 workers trapped workers drew attention to working conditions. Throughout Asia, strikes and protests over low wages occurred. In response, brands increased audits and inspections in countries like Bangladesh, India, Vietnam and Cambodia to secure their supply chains. While China remained the largest sourcing region, buyers also looked to alternatives like Vietnam and Africa. The document predicts that 2014 will be a year of increased transparency and accountability in global sourcing.

1. The Year
of Social Accountability
in the Supply Chain?

2. SOCIAL ISSUES PLAGUE
GLOBAL SUPPLY CHAINS
ASIAFOODINSPECTION PRESENTS THE AI 2013 Q4 BAROMETER
A year in review of outsourced manufacturing
and the quality control services industry.
AsiaFoodInspection,
AsiaInspection,
AA leading food safety service provider
leading quality control service provider
that partners with international Brands, Retailers and Importers
that partners with international Brands, Retailers and Importers
to secure and manage their global supply chain.
to secure and manage their global supply chain.

3. A SIA MAN UFACTUR ING
LI FE AFTER RANA PLA ZA
2013 was a challenging year
for brands and retailers worldwide in the face of supply chain social issues
for brands and retailers worldwide in the face of supply chain social issues
Most notably the Rana Plaza tragedy in May,
where a factory collapse in Bangladesh
took the lives of
1,129 people
1,129 people

4. TRAP PED WORKERS
IN JIL IN FACTORY FIRE
The official media reported the fire had been ignited
The official media reported the fire had been ignited
by series of explosions at Baoyuanfeng Poultry
by series of explosions at Baoyuanfeng Poultry
when around 300 to 350 workers were on the site.
EXIT
100 people
escaped
119 people
killed
54 workers
injured
Almost all the doors of the workshops were locked on the outside,
and only a narrow side exit had been left open, which made escaping difficult.

5. Throughout the year in factories across India,
Bangladesh, Cambodia and Myanmar:
Strikes
Riots
Workers Demanding
Higher Wages
The minimum wage in Bangladesh is half China
The minimum wage in Bangladesh is half China
and Cambodia is $80 per month.
and Cambodia is $80 per month.

6. Child labor back in the spotlight
Child labor back in the spotlight
78 Million Children Engaged in Child Labor
in the Asia and Pacific Region*
* US Department of Labor. October 2013

7. Figures for AsiaInspection reflect
brands and retailers are taking action
+61% Audits increase
+61% Audits increase
in Asia for 2013 compared with 2012
While Bangladesh was in the spotlight,
buyers took to securing their supply chain in all sourcing regions, year over year
+47% Audits
+47% Audits
in Bangladesh
+112% Audits
+112% Audits
in India
+58% Audits
+58% Audits
in China

8. As a result of the tragic incidents in Bangladesh
news emerged of buyers starting to look for alternatives in the region.
AsiaInspection ordered inspection figures further support this.
+36%
+44%
Inspections in Bangladesh
Inspections in India
+71%
Inspections in Vietnam
+114%
Largest exporter for apparel
in volume after China
Inspections in Cambodia

9. SOUR CING POWER:
NA VS. REST OF THE WORLD
CHINA VS. REST OF THE
Despite fears that China’s competitiveness would be eroded
by the appreciation of the RMB and wage inflation,
China’s exports continue to set new highs.
12.7%
November was up
compared with a year earlier
9.3%
2013 showed an increase
for the period of January to November
compared to 2012
This puts China on track to report
This puts China on track to report
the largest annual trade surplus since 2008

10. AsiaInspection inspection figures mirror this with a
+17% increase in ordered inspections in China
in 2013 compared with 2012.
Bangladesh exports amounted
Bangladesh exports amounted
to a mere 1% to that of China.
to a mere 1% to that of China.
In 2013, China remained by far
In 2013, China remained by far
the largest sourcing region
the largest sourcing region
used by AI clients.
used by AI clients.
CHINA
BANGLADESH
BANGLADESH
AsiaInspection
n
spectio
AsiaIn
AsiaInspe
ction

11. 2013 confirmed
the trend for new sourcing regions
with Africa
seeing a 47% increase
the second half of the year
Vietnam was up
by 71%
increase
ection
AsiaInsp
on
AsiaInspecti AsiaInspection
tion
AsiaFoodInspec
Cambodia doubled
despite protests
over wage concerns

12. CT
W HAT TO E XPECING
UR
IN 2014 GLOBAL SOURCING
obvious from the
tragic events in 2013
“ It’sthat transparencycurrent statistics andare in great need.
and accountability
Western buyers do not actually know what’s going on in their factories
Western buyers do not actually know what’s going on in their factories
as was demonstrated when H&M published their entire supplier list.
Sebastien Breteau, CEO of AsiaFoodInspection
on
ction
pe
AsiaFoodInspection
AsiaInspe cti
AsiaIns
“
“
2014 will be a year of transparency

13. FOOD SCANDALS CONTINUE
TO ROCK CHINA SUPPLY CHAIN
China continues to be a breeding ground for food scandals
led by the combination of
food suppliers eager
to cut costs
extremely limited
government oversight

14. The increasing number of prosecutions hasn’t worked as a deterrent with
new scandals continuing to arise
on an almost monthly basis.
Wal-Mart China’s own CEO, Greg Foran, recently had to issue a public apology for their
stores selling “other animal” meat, including fox meat,
to consumers.
up 53% AFI food inspections
up 53% AFI food inspections
in 2013 compared with 2012,
amidst the fear and increased sourcing from Asia

15. ABOUT ASIAFOODINSPECTION
™
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