In 2011 companies’ supply chains will gain greater importance, irrespective of the size of businesses involved.
The primary driver of this trend is taking recognised measurements for water consumption, waste and greenhouse gas emissions and applying them to a company’s supply chain.
But many businesses are finding this tricky for their overseas suppliers as the practical implementation of responsibility can vary from country to country.
Shirahime, a UK based ethical fashion consultancy, has published a guide to responsibly sourcing textiles and clothes from India.
Despite its narrow country and industry focus, the guide is packed with advice for any business looking to find responsible goods or services suppliers from overseas.
Be clear about the outcomes you want to achieve
Define aims clearly and build a strategy around the outcomes you want to achieve. Don’t try to do everything all at once: focus on what is important now.
Don’t look exclusively for suppliers who have certification. Certification is a costly process and may not guarantee the specific outcomes youwant.
Instead, visit potential suppliers and examine their operations for yourself. If you do this, make sure you have a suitable translator and cultural liaison who can guide your decision making process.
In addition, start networking, even if it’s with your competitors. If you do this up front it can vastly increase your chances of success in finding the right supplier.
Consider company size alongside business practices
There can be a correlation between a supplier’s size, the goods or services it provides, and its ability to operate responsibly.
As a broad rule of thumb, the larger the company the more comprehensive their offering will be. Yet the larger the company, the more likely it is that their business is focussed upon financial efficiency, not responsible practice.
Therefore, if you’re looking for a responsible supplier it may be worth choosing smaller producers rather than bulk providers as your partners.
To make this affordable, you should collaborate with other companies, including competitors. Effective purchasing partnerships can influence medium sized enterprises significantly, leading to a greater overall focus on sustainability.
Consider alternatives to your preferred goods, service or country
India is the largest organic cotton producer in the world. However it also produces other sustainable natural fibres and is the eighth largest wool producer in the world. Few people would think of India as a source of wool and if your intention was to buy textiles from India you wouldn’t immediately think of wool, would you?
In order to get the most responsible procurement deal, businesses have to change their mindset and be open minded about both the country of origin and the goods or service they’re looking to procure.
Be prepared to invest as well as purchase
This final point is possibly the most important in Shirahime’s report: the days of simply handing over the money to supplier are fading fast.
Instead, businesses need to think about how they can contribute long term value to their suppliers’ enterprise beyond a simple commercial deal.
This is where the value of being clear in your outcomes and partnering with other companies can yield substantial benefits.
For example, your business wants to reduce carbon emissions and you and your partners have found a suitable company. However, you know this company’s health and safety record is not desirable … what can you do to improve it?
As part of the commercial relationship with your supplier, you can offer health and safety training and leverage resources across the partner companies as appropriate.
This is not about financial gain. It’s about investing long term in the sustainability of both the supplier and purchasing companies: sharing skills and knowledge on a commercial basis for the benefit of all.
Richard Perkins, WWF’s senior commodities adviser, agrees with Shirahime’s approach. “You must be clear about the risks arising from your impacts and dependencies, that you’re trying to mitigate,” he says.
“It’s all about drawing up your own analysis and then speaking to stakeholders to place risk mitigation and identification of opportunities alongside other purchasing criteria.”
Sorry, the comment form is closed at this time.