Correlations | Perilous Arithmetic

Mehul Srivastava

PHOTOGRAPH BY AARON DYER FOR BLOOMBERG BUSINESSWEEK

Factory owner Tipu Munshi says safety in Bangladesh’s garment industry could be ensured if retailers stopped haggling and paid the 90¢ per pair it costs to sew jeans, like the Walmart-ordered pair below, in a safe facility. Buyers often bargain down to what Munshi calls a danger zone, where rivals make cuts that threaten safety. “Let us earn those few cents, and nobody has to die while making basic jeans.”

Made in Bangladesh

The shell fabric is 63 percent cotton, 36 percent polyester, and 1 percent elastane at a cost of $3.69 per pair

A 20-millimeter fancy shank button costs

The 4.5-inch metal zipper costs 15¢

Sepal charges 90¢ per pair for cutting and making the jeans, which includes labor and factory expenses such as rent, energy, and safety measures

Monthly wages for garment workers

Bangladesh $48

The country’s garment industry has spawned 5,000 factories and produced $18 billion in exports in 2012

Vietnam $100

China $235

Oklahoma $1,440

A company called Round House has produced jeans in Shawnee for 110 years

Munshi’s Sepal Garments, one of Bangladesh’s biggest apparel producers, makes these jeans for Asda, a Wal-Mart Stores subsidiary in Britain

After materials, assembly, and 26¢ profit, Sepal sells the jeans to Hong Kong middleman Li & Fung for ...

$7.29

+

Shipping cost, plus profit for Li & Fung and Walmart:

$4.33

+

Asda store costs, profit, tax, and other expenses:

$10.50

=

Price for Asda customers in Britain:

$22.12

DATA: SEPAL GARMENTS, BLOOMBERG INDUSTRIES ESTIMATES

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