November 10, 2021

Transparency: People & Pay

By Pukhraj Ranjan
Transparency: People & Pay

WHY TRANSPARENCY MATTERS

Words from Fashion Revolution

A lack of transparency costs lives. When the Rana Plaza building collapsed eight years ago, killing and injuring thousands of garment workers, rescuers had to dig through the rubble looking for clothing labels in order to figure out which brands were producing clothes there. It is impossible for companies to make sure human rights are safeguarded, working conditions are safe and the environment is protected without knowing where their products are being made. 

But eight years after Rana Plaza, there is still much to be done. The global fashion industry remains rife with human rights abuses and environmental degradation. Supply chains remain complex, fragmented, deregulated and opaque.

A lack of visibility of supply chains can allow exploitative, unsafe working conditions and environmental damage to thrive while obscuring who has the responsibility and power to redress these issues. 

Increased transparency enables workers’ rights and environmental advocates to identify, report and redress suspected abuses and helps brands and retailers to better track and manage social, environmental and governance risks that may affect their business.

 

TRANSPARENCY AT MOI NAMASTE

At Moi Namaste, we are proud partners of many artisan-centred communities. All our products are made in partnership with artisans, often combining their skills & wisdom with our design.

Therefore, a holistic assessment of an ethical and sustainable brand requires a deep understanding of the (product and packaging) design, materials and manufacturing as well as their associated costs.

To honour the commitment to educating our customers, in our previous website, we offered price breakdown for each product as well as certain additional information on our purchasing model, commitment to human rights, etc. Often these are directly inspired by the Fair Trade Principles as set by the WFTO and the United Nation's Sustainable Development Goals.

In this new website, we decided to create clear sections talking about our focus of Ethics and Sustainability. The following subpages should give you information about what we stand for as a brand:

1. Our Brand Commitments

2. Our Artisans (Who they are and our community projects)

3. SDGs & Fair trade

 

In this blog, I want to reiterate certain maker non-negotiables and share our cost splits for our customer's knowledge.

In India, we prioritise working with NGOS and established women groups or craft clusters, where the makers are paid regular salaries on a monthly basis (and not on a per-piece-pay). Our makers often work with multiple brands and the offered prices are mutually agreed upon through dialogue and participation.

In most cases, no to minimal negotiation strategies are involved and we provide 50% advance payments to help support the artisan to get the production started. Of course, we do not engage with any sort of child or forced labour.

 

COST SPLIT

For our customers it is important to know that the pricing of our product is majorly dictated by Finnish taxes and the international logistics cost. On average, our homeware & apparel products follow the following breakdown:

    • 24% VAT (Value Added Tax in Finland)
    • 19% Export & Customs (International logistics and customs)
    • 18% Making Costs (Fabric sourcing/creation, designing and sampling, final productions, finishing and quality checks)
    • 10% Marketing & Website costs (photoshoot, website, online ads, pop up rents, stockist fees)
    • 5% Office costs (office costs, coffee, accounting & taxation)
    • 24% Profit  (salaries, pension, insurance, designers/freelancers fees)

Additionally, at the end of the year, we use 10% of our annual profits (after paying Finnish taxes) to hold community development projects for our artisans. We have also made the commitment to celebrate our anniversary by planting trees in India for all the orders received that year (starting 2021-22).

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