Businesses have to make some amount of profit. How much profit is the question. The answer can define its character as well as how it treats the people who keep its roof up.
Fair labor practices are a hot topic in the news, particularly about one of Apple’s main suppliers, Foxconn, a leading producer of iPhones and iPads. They employ over 1 million people in China and around the world. The focus has been on Foxconn’s long labor hours and questionable working conditions.
The subject of fair labor seems to usually focus on the manufacturers’ side. Is it because the word “labor” is automatically associated with a factory, and not with the companies which contract the factory?
To some companies, it’s all about how much they can squeeze to keep all they can in their own pocket.
Take Apple for instance. Apple made $13.1 billion in 2011. An iPhone 4 unlocked without a contract sells for $699 in-store. Foxconn’s labor cost for assembling an iPhone is about $12-$30. Foxconn makes about $7 estimated gross profit for making an iPhone 4, while Apple makes over $400 (the entire phone with parts from over 150 countries along with Foxconn labor cost is estimated to be about $200).
The disparity here is obvious. It should naturally raise a question: Should Apple “sacrifice” some of its profits to help their suppliers build better facilities and allow the workers to work less hours, while still being profitable?
It’s not an easy relationship for brands and factories. Yet if we all operated with the mind that “fair” leads to the most optimum outcome, we could see how investing in fair labor while making fair profits is actually maximizing profits. “Profits” profoundly meaning more than just one thing. It could mean for instance overall employee job satisfaction and the encouragement of human dignity, which creates fidelity therein leading to greater productivity and less employee turnover.
We all give more of ourselves when we feel that we count.
That was my belief when I started Smartthreads 1=1. I am a firm believer that maximizing profits above all else equals greed, not a business model.
—
Smartthreads 1=1
Chris Young, Creative Thread
