"Treat the PhD as just another job". It was great advice that I got when I first made the switch to academia, but I suspect the only people who would ever say that are those who haven't done one. The PhD, the research, the concepts, the thinking...it takes over your life. I think I better understand the sentiment "it feels like you are married to your PhD", which I had also been told at the start, but which I didn't like the sound of quite so much.
This thought-train struck me as I was standing in borrowed heels, with champagne coursing through my veins and heavy Latino beats in the background (life in Dhaka is very different to the rural areas) and posing the question "so what are the effects of the current rising cotton prices on your margins"?
It was my night off, but it's amazing how my work and particularly the distribution of value in supply chains can be incorporated into just about any conversation...mostly because I find it very interesting. I suppose that in this regard, I know I am doing the right PhD for me.
I was chatting with the expat* manager of a clothing company that supplies the likes of George (for Asda), Tesco, Primark etc. Global cotton prices have risen by around 60% in the past year or so, mostly due to floods in Pakistan and the failure of cotton crops in other locations for various reasons. This puts substantial pressure on textile manufacturers, particularly the providers of cheap cotton to European consumers. What I found out is that brands such as George sell their jeans for, let's say, £3 a pair. Their market is people such as electricians and builders who race through pairs of jeans, buy in bulk, and don't want to spend a lot of money. In fact, George sells £3 jeans at a loss. They do this because once you are in the store and buying your pair of jeans, you are far more likely to purchase other products found in an Asda store. In this way, it's worth losing a little bit of jeans money and making it up a few-fold elsewhere.
But Primark, for example, doesn't have the luxury of a number of other products to sell in their stores. So they can't sell the same jeans at a loss and therefore charge £8-£9. In fact, selling at a loss is subject to heavy fines in the EuroZone as it undermines independent retailers and is likely to force them out of business. That's why you have massive one-stop-shop retailers in the UK, and lots of little boutiques in, say, France.
Here's the inside scoop: retailers are currently conducting a staring contest to see who will be the first to crack and raise the prices of textiles such as clothes and bed sheets to a price that will make a profit. Naturally, the largest companies can probably hold out the longest. But the spring-summer collection shipped a few months ago at the higher cotton price and the autumn-winter collection - currently in production - will be even higher prices. So get shopping now if you are still looking for cheaper clothing!
I also spoke with the Quality Controler of a well-known European furniture supplier (at the same party). According to him, Bangladesh is the cheapest location for the production of textiles at the moment and they supply 80% of their textiles from Bangladesh. Even China is more expensive than Bangladesh as it attempts to reposition itself in the 'green' market. The company I was now sharing the white bubbly with is also currently absorbing the costs of rising cotton prices, mostly because they want to continue to sell at low prices for as long as possible. Why? Because consumers want cheap things. That always comes at a cost but it's mostly someone else who pays. But he was also quick to tell me (unprompted) of the ethical standards employed throughout their supply chain. I suspect a company selling at a loss is likely to need them to stop all corners being cut.
Anyway, it reminded me how easy it is to play 'the dumb blonde' and learn all sorts of insider secrets, how much I am interested in learning about how these big companies actually work, how much I am convinced that consumers have purchasing power if only they care, and how difficult it is to balance in heels after a couple of glasses of champagne.
* An expatriate (expat) is a person permanently or temporarily residing in a country or culture that is other to that of the person's upbringing or legal residence.