David Jones CEO Paul Zahra has resigned following the recent $2.2 billion sale of the company to South African fashion retailer Woolworths with the announcement of more changes to follow.

A new board of directors are beginning their tenure with David Jones and current CEO Ian Nairn has made their future direction clear with the announcement of their desire to increase the use of private label in-house brands.

There had been initial concerns before the sale that Woolworths would use more private labels who source their materials from an extensive and sometimes incomprehensible network of third party producers.

Global sourcing firm Li & Fung is one of the most successful of these private labels.  They supply 40% of all apparel sold in the US, generate $21 billion in revenue and source their materials from over 15,000 producers with factories in countries such as China and Bangladesh.

David Jones and their board of directors are home to former employees of Li & Fung and to their subsidiaries such as Marks and Spencer creating firmer ties between these private labels and one of Australia’s largest fashion retailers. 

What this means for the future of David Jones is slightly disconcerting. The argument will be made is that it is a cost effective approach to fashion but it is tremendously bereft of any social and environmental responsibility. 

The problem is these "private" labels are enormous businesses who wield power and influence with impunity, businesses like Li & Fung, which have become so powerful that they use it to manipulate. 

You can read more about them here. Worst still is their woeful and embarrassing approach to sustainability. Their efforts are so passive and indirect as to not even exist at all. You can read this here.  

No mention was made of its factories in China and Bangladesh but its nice that management has some diversity. 

 

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