key: cord-0919597-k2s0ix6k
authors: Anner, Mark
title: “Power relations in global supply chains and the unequal distribution of costs during crises: Squeezing suppliers and workers during the Covid‐19 pandemic”
date: 2021-10-28
journal: Int Labour Rev
DOI: 10.1111/ilr.12337
sha: f56d9c4a99594adeafdb740afe287cb9c7a0dd22
doc_id: 919597
cord_uid: k2s0ix6k

In early 2020, apparel brands and retailers cancelled USD 40 billion in garment orders with highly adverse consequences for suppliers and workers. Their actions illustrate the power asymmetries in global supply chains and the unequal distribution of costs during crises. The cancellations provoked a tentative collaboration between suppliers and worker rights advocates and an effective “pay up” campaign. Yet, buyers subsequently intensified their squeeze on suppliers with adverse impacts on workers, leading to calls for binding agreements. These dynamics arguments are explored through original survey data, supplier questionnaires, stakeholder interviews, a time‐line analysis, and trade data analysis.

response to that campaign: and 3. Emerging buyer purchasing practices as the pandemic continued into the second half of 2020 and 2021.

This article builds on research that argued power imbalances between buyers and suppliers have grown since the phase out of the Multifibre Arrangement in 2005 and the dramatic expansion of garment suppliers with the entry of China and Vietnam into the WTO (Anner 2019 (Anner , 2020 . Based on this research, we would expect that buyers would impose on suppliers a disproportionate share of the costs associated with the Covid-19 pandemic. Moreover, we could expect that suppliers in turn would use their power over workers to shift part of the adverse impacts onto their employees. Yet, literature of workers' rights in GSCs suggests that workers and their allies can resort to symbolic (shaming) power to leverage brands to change adverse practices (Bartley and Child 2014; Chun 2009 ). Yet, variations in institutional contexts and firm structures and market segments might shape firms' reactions to campaign pressure (Ahlquist and Mosley 2021) .

To explore these arguments, I conducted a survey of Bangladeshi suppliers, analysed supplier order cancellation data, studied the social movement response to the cancellations, established a timeline on when brands reversed their decision to cancel, conducted structured interviews with suppliers in Bangladesh and other major garment-exporting countries, and examined pricing dynamics between select consumer and producing countries using trade data.

Research on global supply chains (GSCs) 1 historically has sought to understand the unequal distribution of rewards along nodes of production, distribution, and consumption (Bair 2009; Dicken 2015; Hopkins and Wallerstein 1986) . The term 'lead firm,' as developed by Gereffi (1994) , has been used to designate which actor in a GSC holds the most power in a GSC. Lead firm power, Gereffi argues, allows these firms to appropriate the greatest share of value created along the chain (Gereffi 1994) . Talbot (2009) adds, "The actors that exercise governance over segments of the chain set rules that influence how commodities and money flow through their respective segments, and thereby, how the money is distributed within those segments" (Talbot 2009: 103) .

Purchasing practices are thus shaped by the purchasing power of lead firms. As noted by Sturgeon, "Although it is not always exercised, purchasing power allows a lead firm to explicitly coordinate the activities of its supply chain and to pressure suppliers to lower costs, increase quality, adopt specific equipment, employ specific business processes, purchase inputs from specific vendors, and invest in specific locations" (Sturgeon 2009: 129) . Research on garment GSCs shows how buyers were able to increase their benefits, not only by way of a continuous squeeze down on the prices paid to their suppliers, but also by their practice of shortening production lead times and delaying payments to suppliers (Anner 2019 (Anner , 2020 . This buyer squeeze on suppliers, in turn, results in a supplier squeeze on workers, who experience wages below a living wage, excessive working hours, increased work intensity, and a denial of their rights to form unions and bargain collectively (Ibid.). These impacts disproportionately affect women (Barrientos 2019; Barrientos, Dolan, and Tallotire 2003) . As Barrientos argues, such a purchasing practice squeeze "often plays out within a gendered contested terrain where women workers bear the brunt of adverse purchasing practices" (Barrientos 2013: 44) .

These power relations are seldom stagnant. Since the early 2000s, there has been a discussion in the literature regarding whether power imbalances in garment GSCs are increasing or decreasing. Ashok (2020) insightfully argues that mega suppliers gained power because buyers' power to push down on costs in the garment sector forced small garment factories out of business. Yet, it is also plausible that, while suppliers may be growing in size and capabilities, buyers (such as Amazon and Walmart) are consolidating their power to an even greater degree. For decades, brands and especially retailers have grown through mergers and acquisitions and by developing and leveraging data and financial systems, resulting in a dramatic shift in market consolidation and thus power of several large retailers (Abernathy et al. 1999 ). In the 2000s, the growth of thirdparty e-commerce platforms has allowed the largest online retailers to gather real-time data on third parties and use that data to launch brands and out compete other brands. This allows these retailers to further consolidate their power as buyers (Khan 2017) . The Covid-19 pandemic further facilitated the power consolidation of the largest retailers and e-commerce firms, whose operations continued and did not suffer from reduced traffic as a result of the pandemic.

One way to explore whether buyer power or supplier power is increasing is to examine the distribution of benefits over time. As Talbot observes, "Changes over time in these distributions of benefits are key indicators of changes in the structure of chains and of shifts in power along them" (Talbot 2009: 104) . Research shows that the real dollar price paid by buyers to suppliers per garment over a twenty-eight year period resulted in an increased squeezed by buyers on price paid to suppliers following the phase out of the Multi-Fibre Arrangement (Anner 2020) . Relative power among actors in GSCs are modified with changes in the spatial and territorial range and flexibility of each of the actors (Dicken 2015) , and the phase out of the Multi-Fibre Arrangement gave buyers much greater spatial flexibility on where to produce, thus increasing their power relative to suppliers.

In addition to looking at the distribution of benefits to ascertain power relations in GSCs, it is also possible to examine the distribution of costs during a crisis. The Covid-19 pandemic provides just such an opportunity. If suppliers have increased their power, it can be expected that suppliers will demand that brands and retailers promptly pay in full for all order commitments. In addition, since the pandemic impacted the prices of raw materials coming out of China, powerful suppliers could inform their buyers that they would have to add an additional fee on previously agreed upon prices to account for this increase in raw material costs. Moreover, in cases were governments forced factories to shut down operations, suppliers could use their power to evoke force majeure clauses in their contracts with the buyers by which they could inform buyers that, due to circumstances beyond their control, they would ship orders later than expected without paying late fees.

In contrast to the above scenario in which suppliers hold increased power over buyers, the opposite could be true, and buyers could have increased their power over suppliers. In this case, as I argue in this article, buyers are able to delay their payments to suppliers; indeed, they are the ones to cancel orders using the force majeure principle. And, rather than adjust prices upward in response to the rising costs of raw material, we can anticipate that the buyers will use their power to push the prices paid to suppliers down further.

If suppliers are at a structural disadvantage vis-à-vis buyers for the reasons explained above, workers are at an even more substantial structural disadvantage in their relationship with the suppliers, who are their direct employers. This is because most apparel production is located in labour surplus economies, where pervasive unemployment and underemployment allow suppliers to pay below subsistence wages and to otherwise squeeze workers who they control due to the workers' fear of unemployment (Nathan, Tewari, and Sakar 2016) . Workers find themselves at further disadvantage given that most apparel production is located in labour repressive regimes where suppliers can turn to the state to put down worker unrest or otherwise control labour (Anner 2015) .

The squeeze on labour is further differentiated based on local patterns of gender subordination and socially constructed meanings of women's work (Barrientos 2019; Singh 2016) . Historically, women have borne the brunt of economic and social disruptions during economic crises (Tejani and Fukuda-Parr 2021) . Race (Bank Muñoz 2008), caste (Mezzadri 2017) , and migrant worker status (Ford 2019) further compound patterns of exploitation in garment global supply chains, with many of the most vulnerable women workers consigned to low-paid and precarious informal work arrangements (Agarwala 2013; Benería and Roldán 1987) .

Yet, while suppliers and workers may hold less economic power relative to buyers, they are able to leverage symbolic power, understood as ''morally charged language'' designed to appeal and mobilize support of civil society (Chun 2009: 4) . Indeed, what proved particularly powerful during the early period of the Covid-19 pandemic was the ability of suppliers and workers' rights activists to coordinate their efforts in order to leverage brands to 'pay up' by making good on payments of their cancelled orders. This was possible because suppliers realized they needed the moral legitimacy of activists and workers' rights advocates, and workers' rights advocates understood that if suppliers went out of business, millions of workers would lose their jobs. Moreover, suppliers had data on order cancellations that were crucial for the campaign. The campaign itself made highly effective use of social media through the hashtag "#layup."

Yet not all firms can be expected to respond equally to social movement pressure. Scholars have observed how national regulatory context plays a role in shaping firms' attitudes toward transnational initiatives (Schuessler, Frenkel, and Wright 2019) . This is, in part, because apparel companies are shaped by the institutional context where they are headquartered, be that Liberal Market Economies (e.g., the United States, the United Kingdom, and Australia) or Coordinated Market Economies (e.g., Germany, Japan, and Sweden) (Hall and Soskice 2001) . Thus, under certain circumstances, multi-national corporations can be expected to behave differently depending on the norms and regulations of their home country (Edwards, Marginson, and Ferner 2013) . Donaghey and Reinecke (2018) found, when studying buyer response to building safety initiatives following the Rana Plaza building collapse in Bangladesh, that continental European firms where home country unionization rates are high were likely to join the binding Bangladesh Accord by which they would co-govern the program with trade unions, whereas North American firms were more likely to join the non-binding Alliance program that did not have co-governance with trade unions.

Beyond national institutional contexts, firm conduct in the apparel sector may also vary based on a firm type and market segment. For example, scholars have argued that general retailers and discounters typically receive little stakeholder pressure regarding labour standards issues from non-governmental organizations or consumers (Bartley and Child 2014) . Ahlquist and Mosley (2021) find that factors influencing whether a firm joined the Bangladesh Accord (co-governance with unions) or whether they joined the Alliance (no co-governance with unions) included whether the brand was consumer-facing with a high degree of reputational risk, publicly listed, and/or whether or not it imported a large volume of garments from Bangladesh. Consumer-facing companies, they argue, experience the highest degree of reputational risk when bad behaviour is exposed. Publicly-traded companies are more visible and rights violations could have negative consequences for equity market valuations (Marx 2008) . And a high degree of dependence on garment exports from Bangladesh would increase the perception of responsibility for human rights harm caused by bad behaviour (Ahlquist and Mosley 2021) .

Finally, there are significant variations among apparel exporting countries in terms of their capabilities (Gereffi and Frederick 2010) . If, as Gereffi, Humphrey and Sturgeon (2005) suggest, greater supplier capabilities indicate a greater ability to mitigate buyer power, then we might expect slightly less severe adverse impacts at suppliers located in countries with high levels of capability such as China versus suppliers located in countries that established themselves as focusing on cost savings, such as Bangladesh. In the context of Covid-19, supplier capabilities might also include greater speed to market due to geographic proximity (e.g., Turkey for the European buyers) or an ability to specialize in small order size, such as India (Mezzadri 2017) .

Global supply chain relationships are highly dynamic. After the initial crisis and the "payup" campaign, buyers could be expected to look for new ways to reduce costs that do not necessarily include terminating contracts. They could provide smaller orders at quicker delivery times, lower prices, and with delayed payment terms. The ability of the campaign to respond to such practices might be more limited given the complexity of the issue. And suppliers might feel pressure to no longer share data with activists as they seek to re-establish relationships with buyers, no matter how unfavourable, in order to stay in business. This would create new challenges for the workers' rights movements going forward.

The first section of this study draws on data provided by the Bangladesh Garment Manufacturers and Exporters Association (BGMEA). When the BGMEA learned of order cancellations, it instructed all of its member organizations to go to a portal and enter every order cancellation by buyer, amount, and date. The database continued to evolve over time as suppliers entered additional data. When I accessed the database on March 28, 2020, there were 6,615 entries totalling USD 3.15 billion. [One month later, the total would reach USD 3.8 billion.] I tally order cancellations by major buyers indicating buyer home countries. This allows for an analysis of which companies cancelled orders at the onset of the Covid-19 pandemic.

The second section this study draws on a survey I conducted of Bangladeshi garment suppliers online between March 21 and April 21, 2020. The purpose of the survey was to ascertain the impact of the order cancellations on suppliers and their workers. At the time of the survey, there were approximately 3,000 active garment export factories in Bangladesh (Huq 2020: 119) . While approximately 40% of suppliers in this country own only one factory, 60% own two or more factories. It is thus estimated that there are approximately 2,000 active supplier firms in Bangladesh. Of these, 376 completed the survey, which is a good response rate for such surveys (18.8%). Of the respondents, 27 are owners of small factories (250 or fewer workers), 128 are owners of medium-sized factories (between 251 and 750 workers), and 221 employ 751 workers or more. Most of the buyers of these suppliers are European (68%); 15% are American, 4.6% are Asian, and the remainder are "other" or a mix of American, European, and Asian firms.

In the third section of this study, I examine the campaign to demand that buyers "pay up" for their cancelled orders. To study the impact of this campaign, I examine a public tracker created by the Worker Rights Consortium (WRC) that indicated which buyers had committed to paying for all orders and which buyers had not made this commitment. The WRC provided me with data of the approximate dates when buyers agreed to pay for their orders. These data allowed me to construct a one-year timeline of major events and when buyers made the commitment to pay for orders. This timeline allows for an analysis of which types of buyers were most likely to respond favourably to social movement pressure and which did not.

Following the pay up campaign, new issues emerged in terms of buyer purchasing practices that had adverse impacts on suppliers and their workers. Notably, through interviews with suppliers, I learned that order volume reduced, prices were further squeeze downward, and buyers delayed payments for orders. To explore these trends more carefully, between July 5 and August 21, 2020, I sent a follow-up questionnaire to Bangladeshi suppliers, and 46 firms responded. I then sent the questionnaire to suppliers elsewhere. 2 This resulted in an additional 29 responses from 12 countries: Cambodia (1), Egypt (1), El Salvador (2), Ethiopia (1), Guatemala (5), Honduras (1), India (1), Indonesia (2), Kenya (1) Nicaragua (1), Pakistan (2), Vietnam (2), and unidentified (9). 3 To complement these findings and probe nuances in the Covid-19 price squeeze finding based on variations in consumer and producer countries, I analyse price per volume of apparel exports from Bangladesh, China, India, and Turkey that were exported to Germany, Sweden, and the United States.

On December 31, 2019, the government of China alerted the World Health Organization (WHO) to a health emergency in Wuhan City in the Hubei province. Just over three weeks later, the Chinese government placed Wuhan's 11 million inhabitants on lockdown. Other cities in the province were locked down soon afterward. For garment global supply chains, this impacted not only Chinese exports of final products, but it dramatically impacted access to raw materials (notably fabric) made in China and needed by exporters elsewhere.

When Covid-19 spread through major consumer markets, notably in the Europe and the United States, what began as regional supply chain disruption became a global crisis as brands and retailers everywhere cancelled orders with their suppliers without paying for the orders. This was a dramatic development that became an instant crisis because cash flow is crucial for garment suppliers. Most often, suppliers are required to front all the funds associated with productionfrom securing fabric and other inputs to covering their operating expenses. And even then, suppliers are often paid by buyers 30 to 90 days after they ship the product. In other words, when buyers cancelled orders without paying, suppliers were already significantly in debt with regard to these same orders and waiting for payments.

Many buyers evoked the concept of force majeure language that was often written into their contracts with suppliers to justify the breaking of their obligations to pay for orders in production. Force majeure ("superior force"), which is common in international agreements of common and civil law countries, is invoked when a party demands it be excused from the full performance of a contract (ECCHR, ILAW, and WRC 2020: 8). For example, Primark, includes the following standard language in its contracts and purchase orders: "The Buyer shall be able to terminate the Contract or Purchase Order and/or cancel any other contracts or purchase orders with the Seller (whether such purchase orders were issued by the Buyer or any other member of the Buyer's group) immediately without liability to the Seller by giving the Seller notice of such termination" (Ibid: 7).

Arcadia (owner of the Topshop and Topman brands) sent written communication to suppliers in March 2020 that said: "You will note that we are able to cancel any order at any stage.

This includes orders in production and orders in transit. [...] If we suspend or cancel an order we will not be legally responsible for any direct or indirect damage or loss this may cause you." (Ibid: 7). In a similar vein, the US retailer, Kohl's, sent a communication to suppliers in March 2020 that said: "We may cancel our Purchase Order in whole or in part without your authorization and at Kohl's sole and absolute discretion in the event of any of the following [...] in the event of acts of God (including, but not limited to, natural disasters, fire, flood, earthquake and disease outbreaks) [...] Cancellation by Kohl's for any of the foregoing reasons shall constitute "for cause" and shall not subject us to any liability, cost, or charge whatsoever" (Ibid: 7).

Thus, the contract language, which allows suppliers to cancel orders overnight, reflects the extreme power imbalance between buyers and suppliers, and it allowed for the unequal distribution of costs during the Covid-19 pandemic. It is important to note that decisions to cancel orders were not decisions made by regional sourcing managers or apparel brand corporate social responsibility officers. Discussions I had with several buyers indicate that this decision was made at the highest levels of the 'C-suite,' often by the buyers' Chief Financial Officers (CFOs). As one major industry trade publication observed, "In the early months of the global health crisis, many companies leaned on their finance heads to make tough and sometimes painful decisions to protect their businesses" (McDonald 2021) . This reflects the severity with which buyers took the Covid-19 pandemic and the drastic measure buyers were willing to take to protect their economic interests. It also explains why the impact on suppliers and workers was so universal. CFOs made these decisions and issued the same standard statements on order cancellations to all supplier firms globally.

Yet, buyers made one major miscalculation. They believed that suppliers would not publicly speak out about the cancellations, much less carefully document them. However, Bangladeshi suppliers did speak out through their industry association, the BGMEA. Indeed, BGMEA president, Rubana Huq, made an impassioned plea to buyers to "pay up" on all cancelled orders in a YouTube video that received much attention. 4 She also took another unprecedented step: she reached out to long-time workers' rights advocate, Scott Nova, the executive director of the Worker Rights Consortium (WRC) and to the author of this paper. She agreed to share all the data the BGMEA was collecting from Bangladeshi suppliers on the order cancellations and to send to the BGMEA member listserv a survey I had drafted. Table 1 presents an analysis of the BGMEA order cancellation data as of March 28, 2020. Several observations can be made from these data. First, we see that mass merchandizers, fast fashion brands, and publicly and private traded companies all cancelled orders. And order cancellations came from firms based in Anglo Liberal Market Economies (LMEs) and high-union density Continental European Coordinate Market Economy (CMEs). We also see a very high concentration of order cancellations among several large buyers, notably Primark (USD 312 million), H&M (USD 173 million), and C&A (170 million * "Multi-buyer entries" are entries for which a supplier listed several buyers as a part of one entry; these were mostly for large buyers. For example, "Primark, H&M, and C&A USD 5 million". This prevented me from registering the cancellation amount with a single buyer, so I have grouped these into one category.

To ascertain the impact of the order cancellations on suppliers and their workers, I conducted the survey of Bangladeshi suppliers between March 21, 2020 and April 21, 2020. In response to the survey question, "Since the outbreak of the Coronavirus, have you had in-process orders cancelled prior to shipment?" more than 50% of suppliers indicated that they had "a lot," "most," or "all" of their orders cancelled. In this case, we can observe variation in buyer home country (e.g., US) or region (e.g., the European The survey results show that, in the majority of cases (73.1%), when in-process orders were cancelled, buyers refused to pay for the cost of raw material (e.g., fabric, etc.) that had already been purchased by the suppliers prior to the cancellation. EU buyers were slightly more likely to refuse to pay for input costs than US buyers, but the difference is small. [See Table 3 .] This failure to pay for raw material costs such as fabric results in an enormous economic loss on suppliers since fabric can account for 70% of production costs. Buyers also refused to pay suppliers for their production ("cut and make" or CM) costs in 91.1% of the cases, with no significant difference between US and EU buyers. [See Table 4 .] While the data presented above is based on a survey of Bangladeshi suppliers, additional research and interviews with key stakeholders reveal that the cancellation of orders without paying was a general trend across supplier countries. This is because, as noted above, the decision was often made by corporate CFOs for all suppliers globally. I also spoke with dozens of suppliers in other Asian, African, and Latin American countries, all of whom confirmed that this was a general trend. Indeed, many of them shared the emails they received from their buyers, which show standard emails sent by buyers to all their suppliers.

The impact of these abrupt cancellations of in-process orders on suppliers was severe; 53.5% of suppliers report shutting down most of their operations and 7.6% of suppliers report being forced to close their facilities. The impact has disproportionately affected small and medium sized enterprises (SMEs), which are defined here as factories that have 750 or fewer workers, with 87.4% reporting a major impact on their operations compared to 77.1% of large enterprises. [See Table 5 .] In the survey, suppliers were asked an open-ended question inviting them to add a comment. One noted, "As of now, buyers have not come up [with] any sorts of discussion. They are not even discussing what are the areas we might have problems. Yes, buyers also have their own problem but [with] buyers as a partner we expect more responsible attitude from them." Another stated, "Buyers are mercilessly cancelling/holding export shipments." A third indicated, "All stakeholders in Bangladesh will not survive if the buyers do not come forward [and pay for their orders]. We have supported them over the years, and this is the time for them to show 'true partnership.'" Many other suppliers also noted that the buyers had previously referred to their relationship as one of a "partnership," but, once the crisis hit, these same buyers terminated the relationship without any consideration for how "partners" might discuss together how best to deal with the consequences of the crisis, which would entail a more equitable distribution of absorbing the costs of crisis. One supplier stated, "We are passing [a] very critical time due to this crisis. Actually, all the customers have given their decision to hold or cancellation of their orders, but they haven't discussed later consequences due to this decision." Several suppliers referred in the survey to the "extreme irresponsibility" of the buyers to abruptly cancel orders and wondered how they, as suppliers, would be able to pay their workers' salaries.

Indeed, the impact of these developments on workers has been significant. For suppliers who abruptly lost contracts that were in-process and received no payment from buyers, 71.8% said they were unable to provide their workers with some income when the workers were furloughed (sent home temporarily) and 81.3% said they were unable to provide severance pay when order cancellations resulted in permanent worker dismissals. The impact was more significant for workers in SMEs. [ Figure 1 .] As noted by Kalpona Akter, executive director of the Bangladesh Center for Workers Solidarity, "Garment workers live hand to mouth. If workers lose their jobs, they will lose their monthly wages that put food on the table for them and their families" (cited in Wright 2020) . What this indicates is that, during crises in garment GSCs, there is a trend for buyers to increase their squeeze on suppliers, and for suppliers to attempt to survive by increasing their squeeze on workers.

From late March through June 2020, suppliers spoke out against buyer order cancellations, academics researched the impact, workers protested factory closures and failures to pay wages, and worker rights groups documented unethical buyer practices. Disseminating all these dynamics to the public domain were major media outlets, including The New York Times, Washington Post, Financial Times, The Guardian, El País, and Le Monde. In this context, a social movement emerged that coalesced into a "pay up campaign" that was inspired by the activist group, Remake, and its hashtag, #PayUp. By July 2020, approximately 241,000 people signed Remake's #PayUp petition, and 46,000 people per day viewed the group's Instagram stories about the call to #PayUp (Cline 2020) .

As suppliers during this period continued to speak out about order cancellations, worker protests escalated, and the media kept the story alive. A "perfect storm" emerged that backed many major buyers into a normative corner-what Chun (2009) refers to as symbolic power. H&M and PVH agreed to pay up for cancelled orders within a day of when an article on the cancellations appeared in The New York Times. Inditex soon followed when its name was included in a research report and spread over social media by Remake and the #payup campaign. The campaign's collaboration with suppliers during this time was particularly crucial, because not only did suppliers provide the needed data to establish the breadth of the problem, but the supplier collaboration also allowed the campaign to verify when buyers did or did not follow through on their stated commitments to "pay up."

Using these data and supplier confirmations, the WRC established a tracker that indicated which brands had paid in full and which brands had not. 5 The tracker played a vital role because it indicated to activists the brands on which they should focus their attention and it created a strong incentive for many brands to pay up in order to have their names moved to the positive side of the tracker. But not all brands and retailers responded positively to call to pay up. Some reputationsensitive fashion companies responded quickly, including European companies with Global Framework Agreements with international trade union organizations (e.g., H&M and Inditex). And US reputation sensitive fashion companies-such as PVH, Gap, and VF-also agreed to pay up despite their considerable economic duress at the time. Yet, some mass merchandizers, such as Target, who are not known for a high degree of reputation sensitivity, also agreed to pay up on cancelled orders. Here a different dynamic was at play; these companies were deemed essential services since they also sold food, which meant they stayed open during the pandemic and thus were in a good financial position that made it easy for them to honour their obligations.

While it is true that many companies that paid up were publicly traded (e.g., H&M, Inditex, Gap, VF, Marks & Spencer), privately-held companies also felt the pressure to pay up, including the companies C&A, Kaaba, and Varner. As Ahlquist and Mosley (2021) suggest, publicly-traded companies are more visible and thus more likely to feel public pressure to act responsibly relative to privately-held companies. However, it also could be seen during the pandemic that publiclytraded companies wanted to show their investors that they were handling the crisis well by having considerable cash and cash equivalents on hand (McDonald 2021) . This group of buyers expressed their financial stability by not paying for orders or dramatically delaying the payment of orders, which indicates an adverse side of public ownership during such a crisis.

Finally, the pay up campaign made the strategic decision to focus campaign efforts on the biggest firms with the largest order cancellations, and those firms that were more likely to agree to pay up. Of the ten companies with the largest order cancellations, seven committed to pay all contracts in full. In contrast, of the 19 top companies that (at this writing) had still not agreed to pay in full, 15 were not signalled out in the initial campaign [See Figure 2 .] By July 2020, an estimated USD 21 billion in orders had been paid up in full out of the initial USD 40 billion in order cancellations. These payments allowed factories to remain in business and saved millions of garment worker jobs. Long-term workers' rights advocate and WRC executive director, Scott Nova, noted, "In terms of its direct financial impact on workers, it's probably the most successful campaign on worker rights in the apparel supply chain ever" (Cline 2020) .

Following the success of the pay up , and as the Covid-19 pandemic continued into the summer months of 2020, new issues emerged. Retail sales only partially recovered during the summer month of 2020 in the EU and the US, and many retailers and brands already had excess inventory. It followed that retailers and brands would not need to purchase as many items as they had purchased during the previous, pre-crisis year. This finding shows up in a questionnaire of conducted of suppliers based in Bangladesh, Cambodia, Egypt, El Salvador, Ethiopia, Guatemala, Honduras, India, Indonesia, Kenya, Nicaragua, Pakistan, and Vietnam in July and August of 2020.

Of the 75 suppliers who completed the questionnaire, 52% of them said they had less than 50% of the volume relative to the same time period in 2019, 33% indicated they were operating with between 51% and 75% of order volume, only 1% of suppliers indicated that they had more orders relative to last year. The suppliers who had increased order volume most often were suppliers who transitioned to making personal protective equipment (PPE) such as face masks. A clear indication that the costs of the second phase of the Covid crisis were not equally shared along garment GSCs can be seen in pricing dynamics: 64.7% of suppliers indicated that buyers were imposing price reductions that were more significant than normal year-to-year reductions, and 56.2% of suppliers reported that they were obligated to accept some orders below costs. [See Figure 3 .] 6

The findings indicate that the average price reduction from the previous year that was faced by suppliers was 12.3%. The price reduction was further explored by examining US trade data for all apparel imports during this same period (July-August 2019 versus July-August 2020). These data included all exporting countries. Top garment exports to the US include China, followed by Vietnam and Bangladesh. What the data show is that, in July and August 2019, the US imported 5.6 billion units (measured in Square Meter Equivalents, or SMEs) for a total value of USD 17.2 billion. This results in an average value of USD 3.09 per unit. In July and August 2020, the US imported 4.6 billion units for a total value for USD 12.5 billion, which indicates an average value of USD 2.72 per unit. Thus, we find an average price reduction of 12.1% when comparing 2019 to 2020. This reduction is very close to the average price reduction of 12.3% for this same time period, indicated by the supplier responses to the questionnaire, which gives us greater confidence in the price and all the other questionnaire findings. The US trade data also provide further insights on the scale of the reduction in order volume: the drop from 5.6 billion units in July-August 2019 to 4.6 billion units in July-August 2020 represents a 17.6% decline. [See Table 6 .] To better understand the logic and reasoning behind this buyer price squeeze, I reviewed quarterly Security and Exchange Commission (SEC) filings by publicly-traded buyers. Michael D. Casey, Chairman & Chief Executive Officer of Carter's, provided particularly insightful comments when reporting on his company's filing as to why brands and retailers have managed to achieve such a dramatic year-on-year squeeze in price. He notes:

Thankfully, given a more favorable environment for input costs and excess manufacturing capacity in Asia, we are forecasting lower product costs for spring 2021. [...] Our expectation is that product costs will be lower; we will have no plan to lower prices in the spring. [...] We expect gross margin expansion. 7 In other words, with so many suppliers in Asia in crisis and facing lost orders, buyers realized that there was even greater excess capacity in the region than is normally the case. The expectation was that suppliers would have to compete with each other to receive more limited orders going forward, which would allow buyers to drive down the price they would pay to suppliers even more than normal year-to-year reductions. At the same time, the company had no intention of passing this cost savings on to consumers. Rather, by lowering the prices that it was paying suppliers while also maintaining the prices it charged consumers, Carter's expected its gross margins to grow in spring 2021.

OTEXA data cover US apparel imports, but there are reasons to believe that apparel importing countries in other major consuming countries might behave differently. As Schuessler, Frenkel and Wright (2019) observe, national regulatory context may play a role in shaping firms' conduct. And it is certainly possible that supplier country characteristics (capabilities, speed to market, etc.), might influence purchasing practices. I explore pricing dynamics for four major garment exporters (Bangladesh, China, India, and Turkey) and two major European importers (Germany and Sweden) using European Union trade data. 8 In this exercise, I compare euros per kilogram of knit apparel imports (HS code 61) in December 2019 (before the pandemic caused lockdowns in Europe) to the value per kilogram of exports in December 2020, still during the pandemic but at a point well past the initial abrupt order cancellations of March 2020.

What these data indicate are an average price paid per kilogram of imported knit apparel of EUR17.70 in December 2019 and of EUR16.17 in December 2020, which constitutes an 8.63% decline. The decline in price is most significant for Bangladesh (13.5% for German imports and 12.86% for Swedish imports). Apparel exports from China and India to Sweden and Germany declined in price in the range of 7.53% to 8.81%. Turkey, the third largest exporter of knit apparel to Germany and Sweden, faced a price decline of 5.65% for Germany and 1.11% for Sweden. One possible reason for the lower rate of decline for apparel exports from Turkey relative to other major exporting countries is the advantage placed on proximity to market enjoyed by Turkish suppliers. In the era of Covid-19, the value of speed to market increased significantly, which might have allowed some Turkish-based suppliers to mitigate the price squeeze to a certain degree. The price decline was less significant in Sweden relative to Germany. [See Table 7 .] 

Beyond the price squeeze, suppliers also reported that many buyers imposed payment schedules that required the suppliers to wait additional weeks or months to be paid for their completed production orders. In 2019, most suppliers (65%) reported through the questionnaire that buyers paid invoices 30 or 45 days after orders were shipped. In 2020, most suppliers (61%) reported that they were paid 60, 90, or even 120 days after order shipment. On average, in 2019, buyers paid suppliers 43 days after shipment, whereas by July-August 2020, suppliers were being paid on average 77 days after shipment. [See Figure 4 .]

These findings on the unequal distribution of costs are reinforced by supplier responses to open-ended questions. One supplier noted: "On most items, certain buyers looked to get discounts without a costing rationale, stating they suffered a loss of sales. If discounts were not given, they also advised future business was at risk, all the while holding back current payments due." One supplier explained how it has sometimes been given the option of accepting greatly deferred payments or getting paid sooner but then having to accept order discounts. This supplier wrote: "Not all buyers [are demanding discounts], but mostly are offering 150 days to 180 days deferred payment terms. In that case, we have to take into account we might face [a] 5% discount to get the payment promptly."

When asked if the continuation of adverse purchasing practices (e.g., smaller order volume, lower prices, and delayed payments) would increase the likelihood that suppliers would be forced to close their business, 32% responded that it was "somewhat likely" and 25% indicated that closure was "extremely likely." Complicating matters further was the fact that many suppliers needed to adjust for social distancing. One adjustment, for example, was to reduce the number of workers per shift in order to provide more space between workers. Such adjustments could be expected to impact order completion times. Yet, suppliers indicated that only 15% of buyers gave them the full flexibility they needed to make safety adjustments, and 33% of buyers gave no flexibility. Rather, these buyers imposed fines or cancelled orders for any delays, regardless of the reason.

One Indian supplier expressed frustrations at the overall situation and reported: "Drop in prices, forced discounts, drop in order volume, delays in payments: all these are happening with all the buyers. In addition to this, all buyers want their goods on time." Another wrote: "There is no accountability of the brand on what they order. If they wish, they can cancel. This needs to change. Suppliers are forced to air [ freight] goods if shipment deadlines are missed or subject to discount. But there is no law that prevails where the buyer is mandated to buy whatever they have ordered. Also, buyers do a due diligence on factory's compliance, but there is no due diligence on buyers' activities." These comments reflect a clear awareness by the suppliers of the unequal distribution of costs during the crisis which are embedded in GSC power asymmetries.

The impact on workers as a result of the purchasing practices outlined above was significant. The findings indicate that, as factories re-opened following lockdowns, most were not operating at full capacity; almost half of suppliers reported that they cut working hours "a moderate amount" (a 10-25% reduction of working hours), "significant amount" (a 26-50% reduction), or "a lot" (a reduction of more than 50%). A second step many suppliers took prior to closure was to reduce employment levels. Comparing employment levels between January 2020 and June 2020, the data show that 62% of suppliers reduced employment, 26% held their employment levels constant, and 12% increased their employment levels, most often due to the production of personal protective equipment (PPE).

For the suppliers completing the questionnaire, on average, there was a 10.1% decline in employment levels from January 2020 to June 2020. Suppliers indicated that, if current trends of order reductions continued, they anticipated cutting their workforce by 35% relative to their current employment levels. One supplier stated: "[Brand and retailer] executives handling sourcing are merciless, and everything about welfare of workers etc. is forgotten when they make demands." One advocacy group found that, during the months of March-May 2020, garment workers lost between USD 3.19 billion and USD 5.79 billion in wages (CCC 2020).

During this same period, reports of workers and their families facing malnutrition emerged. One worker, whose family had been living off of one bag of rice for a month, explained, "Our house rent is due. We are buying all our groceries on credit but they [the store] won't give us any more food [on credit] until we pay our bill. So our landlord managed to get a sack of rice for us and we're surviving on that" (cited in Kelly and Ahmed 2020). A survey conducted in August and September of 2020 of 396 garment workers across 158 factories in nine countries found that 77% of workers reported that they or a member of their household had gone hungry since the beginning of the pandemic primarily as a result of diminished income (Kyritsis, LeBaron, and Nova 2020) . At the same time, some multi-factory suppliers used the crisis to close their unionized factories while keeping the non-union factories running (BHRRC 2020). These findings indicate that the unequal distribution of costs during the pandemic had the most significant adverse impacts on the workers at the bottom of garment GSCs. And this was especially true for women workers (Tejani and Fukuda-Parr 2021) .

This article has argued that buyers maintain considerable leverage over suppliers and that supplier factories hold considerable power over workers in garment global supply chains. I found that buyers indeed pushed many of the costs of the Covid-19 crisis down onto suppliers, and, through the suppliers, onto workers at the bottom of these supply chains. I also suggested that the extremely adverse impact of these cancellations would provoke a broad range of alliances and unlikely collaborations to push back on buyers and leverage them to "pay up" for cancelled orders. However, it was further suggested that the continued uncertainty in consumer demand would contribute to a renewed buyer price squeeze and other adverse purchasing practices on squeezes and their workers. Finally, it was suggested that variations in these dynamics would depend on national institutional contexts and firm types. To test these arguments, I examined supplier data on order cancellations, conducted a survey of Bangladeshi suppliers, created a timeline on brand commitments to "pay up," administered a questionnaire of suppliers in 13 countries, analysed trade data, and interviewed stakeholders. With some important nuances, most of these arguments were verified.

The buyers' actions in response to the Covid-19 pandemic reconfirmed the weakness of voluntary program. During the crisis, a voluntary initiative known as the "Call to Action" came together under the tutelage of the International Labour Organization. By setting out "urgent priorities," the goal was to, "catalyse action from across the global garment industry to support manufacturers to survive the economic disruption caused by the COVID-19 pandemic and to protect garment workers' income, health and employment." 9 Yet, this too provided limited results. For example, by April 2021, one year after the initiative was established, out of 4.1 million garment workers in Bangladesh, only 6,031workers benefited from support tied to this initiative, receiving three payments of approximately USD 36 each. 10 Far more effective was the pay up campaign, which involved a broad coalition of worker rights advocates, outspoken suppliers who shared crucial information with advocates and academics, ceaseless protests by garment workers, relentless media exposés, and an extremely clever social media campaign that coalesced around the hashtag #PayUp. The result was that buyers were forced to pay an estimated USD 21 billion to suppliers for orders that had been cancelled. The campaign illustrated some of the limits of buyer power.

Yet, this article also illustrates how buyer power re-emerged in mid-and late 2020. Buyers squeezed suppliers on price, order volume and payment terms, with devastating consequences for suppliers and especially workers. Millions of workers lost wages, jobs, and severance. And 77% of workers in one survey reported that they or a member of their household had gone hungry since the beginning of the pandemic primarily as a result of diminished income Some multi-factory suppliers used the crisis to close their unionized factories or take other anti-union measures.

This study revealed some common practices across firms and some important sources of variation. In response to the pay up campaign, European reputation-sensitive fashion companies responded quickly, as did a few such US companies. Yet, some mass merchandizers also agreed to pay up on cancelled orders in part because they were deemed essential services and were in a financial position that made it possible for them to honour their obligations. One of the most crucial factors determining which companies paid was whether the pay up campaign decided to focus their efforts on the largest, most visible companies. Of the ten companies with the largest order cancellations, seven committed to pay all contracts in full.

GSCs involve highly complex, dynamic sets of relationships among social and economic actors. In the midst of this complexity, it is possible to gain insights on power relations by "following the money." This is true in terms of the distribution of benefits. And, as shown in this article, it is also true in terms of the distribution of costs during a crisis. In late 2020, as Bangladeshi employers and labour unions fought over whether workers should or should not get a USD 0.16 per day mandated raise (Hossain Ovi 2020), buyers -many of whom had refused to pay all of their cancelled orders in full-returned to full profitability. 11 At this writing, to respond to these imbalances and to protect workers, more than 200 organizations demanded buyers sign a binding 9 See: https://www.ilo.org/global/topics/coronavirus/sectoral/WCMS_742343/lang--en/index.htm 10 See: https://www.ilo.org/wcmsp5/groups/public/---ed_dialogue/--dialogue/documents/genericdocument/wcms_797428.pdf 11 For example, Carter's, the parent company of Oshkosh, brought in USD 1.5 billion in gross profits at the end of 2020. According to our calculations, Carter's cancelled orders with Bangladesh suppliers without paying the USD 24 million owed for these orders. agreement to ensure severance and wage guarantees and respect for workers' rights in the midst of the pandemic. 12 The aspiration is that these broad coalitions and normative power can be harnessed to mitigate the adverse impacts of such extreme power asymmetries that have been a structural feature of garment global supply chains for so long.

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