Raw material procurement, industrial upgrading and labor recruitment: intermediaries in Indonesia's clothing industry

Abstract

In the literature on global commodity chains (GCCs) the organization of global clothing production has been largely described as a production system of a buyer-driven governance structure. However, despite the fact that buyer-driven commodity chains have been described as relatively loose and short-term, the commitment of buyers towards their individual producers can vary significantly. This largely depends on the way in which buyers are linked to their external production networks by intermediaries such as representative offices or agents. The integration of these intermediaries has a high potential to influence the ways in which the required raw materials inputs are procured and the individual production processes are organised. In addition, the analysis of labor relations and labor recruitment has been largely ignored in previous studies on GCCs. However, cultural and historic setting have a strong influence how intermediaries organize labor recruitment. Therefore, this paper aims to unravel the role of intermediaries on clothing production in terms of raw material procurement, industrial upgrading and labor recruitment.