The Gap Labor Problem (Case Study)

The Gap, Inc. is a chain of retail stores that sell casual apparel, shoes and accessories for men, women, and children. The stores headquartered in San Francisco and operate under a variety of names including: Gap, Banana Republic, Old Navy Clothing Company, GapKids and babyGap. All merchandise sold by the chain is private label. Gap had 1348 well-located stores in the US and Puerto Rico, 72 in Canada, 49 in the United Kingdom, and 3 in France.

Apparel stores like Gap purchased their clothes from manufacturers in the United States and around the world. The Gap contracted with over 500 manufacturers around the world who made the Company’s private-label apparel according to Gap’s specification. Gap purchased about 30 percent of its clothes from manufacturers located in the United States and 70 percent from vendors located in 46 foreign countries.

Among the suppliers from whom the Gap sourced its clothes was one in El Salvador run by Mandarin International, a Taiwanese-owned company. A worker there were was paid approximately 12 cents for assembling a Gap T-shirt which retailed at abount $20 in the United States. Wages at Mandarin plant averaged 56 cents an hour, a level that was claimed to provide only 18 percent of the amount needed to support a family of four.

The issue with the case is that Gap cover up the situation at Mandarin such as long hour of work for 56 cents an hour; violence against union supporters; sexual harassment from supervisors; lack of clean drinking water; not being allowed to use rest rooms; and being forced to sweep the factory grounds under a torrid sun as a punishment.

I think Gap should pay more to their suppliers. Companies like Gap should force their suppliers to provide maximum work place safety, by eliminating job risks, compensation for high risk jobs and full awareness of the hazards of a job to employee.

I’ve learned that the goal of a business should not just for profit. It should also think of its suppliers as well as the employees of their suppliers. At the end of the day, everybody has to do their part. 

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