Logistics is the art of controlling supply chains cost effectively but how are costs measured and are they all- inclusive enough to reflect the true total costs for humanity? Obviously, costs are measured to reflect only those costs affecting a business's accounts and so they will not be all-inclusive. Environmental costs, therefore, will not be fully factored in because there is no legal requirement and they would be incalculable anyway. That is not to say that responsible corporations are not addressing environmental cost issues but it must be said that some of their actions are goaded by legal pressures rather than altruistic sentiments. But there is another, hidden, sinister and blatantly illegal cost -- slavery -- and nowhere is this more evident than in Britain's food supply chain. It is all the more disturbing because it could not flourish without the tacit connivance or disinterest of leading food retailers and their suppliers.
United Nations figures suggest 800,000 people are trafficked every year in one form or another, with more people in slavery today than in the entire 350-year history of the Transatlantic slave trade and one in eight are in Europe. It is now considered the second most organised criminal activity worldwide, generating an estimated US$32 billion a year.
Modern day human trafficking for the UK's food supply chain employers does not just mean paying labour rates far below the minimum wage to mainly East European workers entitled to live and work in Britain. It includes regular beatings, often sexual exploitation and threats to harm their families in their homeland countries should they complain to the UK authorities. The scale of the problem is staggering, even though the full extent of the ill-treatment across Britain's entire food and drink industry, which employs 400,000, is unknown. In an enquiry conducted three years ago by the Equality and Human Rights Commission, one fifth of workers interviewed in the meat and poultry processing industry in England and Wales reported suffering physical abuse in a sector employing 90,000 workers.
These victims are hidden within the supermarkets' supply chains and they are usually brought in through employment agencies or gangmasters, a euphemism for slavemasters in many cases. Many of the latter are acting illegally, targeting and controlling non-English speaking, uneducated, vulnerable workers, using violence and intimidation. One egregious case involved supermarket eggs in which workers could toil in 17-hr shifts often completely unpaid. Dissent was allegedly crushed by their Lithuanian enforcers with beatings and the threat of unleashing fighting dogs.
On a general level, when not working employees are often locked in their squalid accommodation and allowed out only when chaperoned. The mainly East European labourers are enticed to the UK with promises of much higher pay and better conditions. Given that the alternative may be homeless unemployment on freezing Polish streets on winter nights it is hardly surprising they accept the lure, whatever suspicions they may have.
The crime that dares not speak its name
So what can the food supply industry and the public do to eradicate this shameful scourge of untold misery at a time when budget cuts have decimated police numbers, consigning human trafficking to a non-priority status? Britain is probably Europe's most logistically efficient country but there is still much room for improvement. In the food industry there is certainly a serious lack of transparency from the retailers about their supply chain partners, and the ease with which they can be hoodwinked was made plain enough by the horse meat scandal, an event, alas, that seems to have produced little change. While outfits like the Gangmasters Licensing Authority believe the supermarkets are not complicit in the abuse it is difficult to dismiss entirely the notion that supermarkets' cost-cutting practices placed on suppliers and their gangmasters do not harm the workers who ultimately bear the brunt. The Joseph Rowntree Foundation charity believes that these cost-cutting exercises could lead to exploitation. A co-author of its recent report on the issue believes there are at least 4,000 workers in forced labour in Britain. "It's the crime that dares not mention its name," he says, explaining that the pressure for competitive prices are passed all the way down the supply chain to the workers.
Supermarkets and their third party logistics providers, however, can be obtuse in other ways. Supply chain collaboration has been a hot topic for years and those companies that have collaborated effectively across the supply chain have seen dramatic cuts in inventories and therefore costs. In many cases, stock-holding costs dwarf all other warehouse costs combined. Why, then, have not many more interested parties followed suit?
Many retailers, it seems, still regard collaboration as a threat rather than an opportunity and are reluctant to reveal the kind of business critical information to their logistics partners that will enable strategies to be developed to deliver the best outcomes for all parties. During a recent United Kingdom Warehouse Association networking lunch, the supply chain director of a leading retailer commented: "In our company we see no advantage in developing a personal relationship with suppliers. We just talk through the numbers and details of the contract." It is a commonplace attitude, and one that encourages practices like ringing up to demand thousands of lettuces over the next few days, thus putting huge pressure on suppliers. Leading retailers undoubtedly bully their suppliers so could it be honestly said that their hands are spotless over slavery in the food supply chain?
Left to itself the food industry will never clean up its act. Government action is needed and if that proves inadequate then consumers could use their ultimate weapon -- shame and boycott. Fortunately, Britain's Home Secretary, Theresa May, has made a good start with plans for a new anti-slavery bill and one MP is calling on Parliament to pass the Transparency in Supply Chain bill. This would compel companies with revenues over £100 million to disclose their efforts to eradicate slavery, including audits of suppliers, training for staff and help for victims. To their shame, Conservative MPs talked down the bill, concerned it would saddle businesses with more red tape. The cost of such measures, however, would be relatively insignificant.
The strength of public concern over this issue is encouraging, with seemingly 82% supporting such legislation, but there is more that they could do. The public could become the eyes and ears of the authorities, reporting any suspected, overcrowded properties housing exploited immigrants to bodies like the Salvation Army* and the Gangmasters Licensing Authority.* They could write to their supermarkets urging them to back the industry-funded Stronger Together initiative. Write also to the Home Secretary, urging her to compel large retailers to report publicly on their work to expunge slavery from their suppliers. Finally, for those retailers who ignore such calls there is always the final solution -- concerted, sustained boycott -- every company's worst nightmare. Boycotts have been shown to work, as with Starbucks, and they will work again. When sitting at home enjoying free-range eggs for breakfast consumers would find that their actions would give their eggs a less tainted taste.
*Salvation Army: Tel: 020 7367 4500
Gangmasters Licensing Authority: Tel: 0800 432 0804