Overtime does not lead to the ‘great’ life
Foxconn has once again been brought to the forefront of investigations for their working conditions at the main site for iPhone production in the Chinese city of Zhengzhou. This past weekend there have been two employee deaths; one suicide and the other accidental. Much speculation into working conditions comes after over a dozen suicides at the same site in 2010. Workers have been put under increasing intense pressure as the new iPhone is due to be released in coming months. More than 10,000 workers have been recruited this month alone.
In some divisions, employees can only be granted overtime by helping to employ another eligible worker. Over the past couple of years, pay has decreased significantly. It is now said that only through working overtime can a sufficient living wage be obtained. However, at Foxconn’s recruitment center, jobs are advertised as a way to ‘live a middle class life’. Not stated is the work and pressure involved to achieve this. Apple has reacted to comments, stating they are committed to the well-being of their workers. Offering employee assistance programs throughout their supply-chain, counselors and psychologists are readily available to help struggling employees. Foxconn, as well as Apple, are going to look into the incidents.
Read more about Foxconn’s operations here.
Fresh take on groceries
Amazon is currently developing a new concept for their grocery sector. The so-called Project X has been in progress since December 2015, however only now is it becoming clearer that it is in relation to groceries. There are 3 potential sites for the development; one in Seattle and two in the Bay area. The new development will enable customers to place an order online and then retrieve the order at the site in the specific pick-up time they have selected. There is also the possibility of placing the order at the site itself, through the use of tablets. This innovative strategy could have a major impact on Amazon’s current delivery service, Amazon Fresh.
Amazon’s share of U.S. grocery sales is less than 1%, however the amount of customers using the site’s grocery option has increased vastly. A survey of Amazon’s customers shows an increase of 18% in users, in comparison to the first quarter of 2015. The hope of this new development is to expand Amazon’s hold in the U.S. grocery market. Being innovative and opening up more options to customers could help them better compete with current big-name grocery companies.
Find more information about Project X here.
Retailers have finally cottoned on
U.S. retailers such as Target, Walmart and Bed, Bath and Beyond have been affected by the alleged scandal involving falsely labeled Egyptian cotton products. The products in question are produced by the Indian textile manufacturer Welspun India. It has been reported that since the accusations, the manufacturer has lost 42% of its market value.
When investigated, it can be seen that Egypt’s cotton output has been declining over the past decade due to a higher demand for cheaper cotton items. Also, the amount of cotton products being produced compared to the amount of harvested Egyptian cotton does not match, leading to believe allegations are in fact true, that the products are being blended with other materials, or falsely labeled. These actions are in direct violation of the U.S’s Federal Trade Commissions’ Textile Act and Rules. It is only one of three companies which is said to have the ‘Gold seal’, a certificate which is meant to ensure the authenticity of the lucrative cotton. Therefore, thorough investigations into the manufacturer’s production will take place. The scandal could have a lasting effect on the cotton industry, leaving ever-lasting doubt for U.S. retailers and customers as to whether the product is the ‘real-deal’.
More information about the scandal can be found here.
After 20 hours of intense talks, an agreement was formed between Volkswagen and its suppliers. The dispute came after the cancellation of a development cooperation program worth half a billion euros, without an explanation. The disagreement was resolved on Tuesday, however a week halt in production due to the reluctance of delivery from 2 suppliers has caused major repercussions for the company. It has been said that the halt will result in a €100 million loss of gross profit for the Wolfsburg headquarters in Germany.
Profits are not the only major impact of the dispute; around 28,000 employees were affected due to the production halt of 10 German factories. Production of models such as Golf and Passat were completely stopped as well as other assembly lines.
Read more on the agreement here.
Have a great weekend!