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Forge stronger ties in your textile supply chain

By Keerti Krishnan

If you’ve taken a minute at a clothing retail store and browsed through a label, chances are that you’ve seen ‘Made in India’ or ‘Made in China’ regardless of where you are in the world! The Asian textile industry has reigned the WTO textile export chart for over a decade. Last year, India and China among other top Asian exporters accounted for 52.31%[1] of the global market. While at the macro level the market position seems grounded, a closer examination would reveal a growing requirement for ethical and sustainably conscious garment suppliers – construing a vulnerability among second and third tier supply chains.

In the wake of the Rana Plaza building collapse in Bangladesh killing 1,129 garment workers, thousands were exposed to ‘unsafe conditions.’ Multinational apparel brands sourcing materials from these suppliers have had their reputation bruised, drawing questions on unethical sourcing and trading. Unfortunately this isn’t the first time a textile sourcing firm has been exposed. Several multinational clothing brands have experienced issues with labour practices and environmental non-compliances. Usually at this juncture, a retailer would mitigate short-term reputational risks by publicising an intended agenda addressing the matter; in the long-term, they may choose to work with the supplier in bettering their standards or replace them all together. The latter has had deeper socio-economic repercussions evident in India.

The competitive micro, small medium enterprises (MSMEs) accounts for 5.33 million[2] producers-suppliers of apparel and textile. Two thirds of Indian textiles (handlooms, hand-made textiles, cotton, wool, jute) are exported primarily to the EU and USA[3]. The Asian market has been lucrative in most ways, cutting manufacturing costs. However for a retailer there are several hidden liabilities. These risks are addressed by sizing potential suppliers against a set criterion designed by the retailer’s ‘Code of Conduct’. Most suppliers are filtered out, usually missing the opportunity to export.

A textile supplier is exposed to several risks including economic turbulence, non-compliance and stiff market competition. Consider Tirupur in Tamil Nadu, a primary textile hub with 750 direct exporters and thousands more as sub-contractors. In a span of just five years the city’s previously bustling streets have several factories shut, owing to a sharp decline in demand during the economic slowdown; non-compliance of zero waste discharge on-site shutting 700 units in 2011 and competitive pricing in Bangladesh. However the price hikes maybe due to a number of factors. Inefficiencies within the factory, is one of them. The Hindu quoted a manufacturer who hiked unit price by Rs.10 owing to high fuel costs to run generator sets during power shortages. Garment factories need to meet manufacturing expenses while sell at a competitive price. When manufacturing costs start to rise, saleability reduces and a shift in market interest re-route sourcing.

While it may seem that there are a plethora of external factors, suppliers need to pedal through, VNV would recommend taking charge of measures within the operation first. Costs could be trimmed when energy deficits, water consumption and waste generation are examined. Leverage on business efficiency by reducing resource ‘leakages’ within the operations to improve company’s sustainable performance and heighten export appeal. Consider acquiring an eco-label for a certain fabric or even an ethical sourcing label to prove credibility in fair labour practices. FairTrade reported a 10-12% rise in products in USA and EU, suggesting a rising sustainable consumer trend. Moreover with the introduction of the Higg index for sustainable apparel and footwear, retailers will rely on their suppliers to ‘do the right thing’.

The sooner you start to review operations, the better you gain competitively.  After all, a stitch in time saves nine!



[2] 20.5 % (IBEF) of 26 million SMES (IndiaStats, Dr. Bhaskaran, 2012).

[3] Ministry of Textiles – International Trade Section

Image source:  Silk weaving in India, dschwab5 flickr,

Empowering tribal artisans through business

What started out as a backpacking tour through Southeast Asia in Spring 2010 serendipitously turned into an entrepreneurial venture for San Francisco-based Boston native Joe Demin. One morning, while his friends dozed on the sands of the coast of Northern Thailand, Demin ventured through a nearby jungle on a bike and literally stumbled across a small wooden shop selling artisanal hammocks by a local hunter-gatherer community, the Mlabri. Visiting with this rural community, he learned of their story and struggle for economic independence and immediately wanted to help. As Demin explains, ‘I literally sketched out a business plan on the back of the plane’s airsick bag.’

Returning to America with a backpack of these beautiful hammocks and a burning idea, Demin’s discovery would develop into Yellow Leaf Hammocks (YLF) — a social enterprise that provides a distribution network for Thai artisans creating hand-woven hammocks and a much larger customer base than they would otherwise have in relying solely on tourists in their home country.

Three years in, Demin and YLF co-founder Rachel Connors have built a solid foundation for a growing enterprise that is positively impacting the lives of over 140 artisans in Thailand, as well as their families and local community, while also reinvigorating a happy, healthy hammock culture in the West.

We caught up with the founding duo to learn about their journey, how their hammocks are positively transforming lives East and West, and what’s next on the agenda.

How did you establish a ‘working’ relationship with the Mlabri community?

At first they looked at me like ‘Who is this guy, travelling up here and proposing this grand idea?’ Though they shortly decided to partner with us, having nothing really to lose. Beginning with this one group, we have expanded from our first weaving village to three and expect to have almost 200 weavers by year’s end! Our ability to provide a sustainable solution to their negative economic situation is the most common question and hesitation we see with each new community. We want to ensure that, for the first time in their lives, people can plan for their future without having to resort to toxic farming or relocate to another village to find employment. We appreciate that everyone wants to work, to make a life for themselves and their families. We are empowering these communities rather than take the traditional donations-based route.

What has been the most challenging aspect in bringing YLH to its current stage in the market, publicly available for sale?

We bootstrapped. We had to tough it out to a degree. Rather than spend money fundraising or seeking investments early on, we developed Yellow Leaf Hammocks ourselves, which also meant slower but steadier growth. When I came back from Thailand with a backpack of hammocks, we took them to festivals and then more festivals. Besides being the outlet for our first orders, it put us in a position to speak directly with our customer. This approach, of course, was not without its hurdles. We did not have access to capital or funding, and so were never really able to make investments in inventory, which meant that customer purchases were constantly on back order. But now, we have amazing momentum and are very happy we didn’t take on investment or risk to dilute our impact.

Our recent partnership with Kiva, which launched in December 2012, helped address this obstacle. In partnering with Kiva, artisans are able to purchase raw materials needed to make hammocks, and it also allows us to expand our global distribution model. Since launching the program, we’ve accelerated our growth, created new jobs in Thailand and have been able to establish relationships with traditional retailers. Our inaugural class of artisan participants went through the Kiva micro-credit program this past January. The program included nine loans in total, and all have since been repaid.

What are the most surprising responses you receive from YLH customers?

When we started out, we wanted to just sell hammocks. We thought if that works, everything else will follow. We did not want to sell products based on our mission, recognizing how other companies have similar artisan models based on charity. Customers typically have questions about the intricate weave, how soft it is and how it’s made, which only then do we share the story. We have learned how to integrate the story into the selling process. We wanted to do this with dignity and respect.

We also stayed really close to the customer, having the benefit of going out and talking face to face with our first 200 customers. Even now, we handle all customer service on an intimate basis.

As we began to grow with the U.S., one thing that struck us most was how the hammocks are improving the lives of customers. Our product actually adds value to the customer or to the family that has a hammock in the house. It brings people together in a really positive way, which we want to communicate more going forward.

What changes would you like to see in the industry to foster scalable success for business models like YLH?

Working with retail partners has been an intensive process to inform and educate them about how an artisan-based retail model can work. Often times, retailers have delayed payment terms which is a challenge for our model, as we look to have payment upfront to provide security for the weavers in Thailand. Especially as a start-up, we have had to negotiate for better terms. Though, by spending time with our partners and helping them understand what goes into making the product, it has been a rewarding experience for both sides. We’ve been working with large retailers such as Amazon, who may have not taken a focused interest in these types of products in the past. Now, they are eager to learn how these products come into the marketplace, and are open to understanding and appreciating them.

Another change would be a larger distribution network that is flexible on how producers make goods that have a positive impact. The fact that we are transitioning away from traditional, very green customers to more mainstream sustainability awareness means that business also has to shift the way we (the industry) view our processes. We want to grow Yellow Leaf Hammocks so we can prove to everyone that there is a demand for this, that customers are into this and people are buying.

What can we expect from YLH in the coming year?

We have some really cool upcoming partnerships, though we cannot announce them yet. We are relaunching our website in the coming months for a better shopping experience and more opportunities for customers to connect with the artisans in Thailand.

For retailers, we are working to make it easier for them to custom design their own hammocks to fit with their customer base or other product lines.

We are redoing our labels, so every hammock will be hand signed by the person who weaved it. We are also expanding our designs to include more seasonal products and exploring collaborations with designers, as well as introducing accessories that will help people hang their hammock more easily.

 

Source: Yellow Leaf Hammocks: Enriching Lives East and West, 

October 22nd, 2013, by Stacy Anderson

Picture taken from yellowleafhammocks.com

Emerging market consumers favour Sustainable Brands

Asp-infographic

A new global consumer study by BBMG, GlobeScan and SustainAbility confirms therise of nearly 2.5 billion consumers globally who are uniting style, social status and sustainability values to redefine consumption. According to the report, The 2013 Aspirational Consumer Index, more than one-third of consumers globally (36.4%) identify as Aspirationals, defined by their love of shopping (78%), desire for responsible consumption (92%) and their trust in brands to act in the best interest of society (58%). The study draws from telephone and in-person surveys of 21,492 consumers across 21 international markets conducted in April 2013.

“Driven by young, optimistic consumers in emerging markets and amplified by technology and social media’s influence, Aspirationals represent a powerful shift in sustainable consumption from obligation to desire,” said Raphael Bemporad, co-founder and chief strategy officer at brand innovation consultancy BBMG. “With Aspirationals, the sustainability proposition has changed from being the ‘right thing to do’ to being the ‘cool thing to do,’ and brands have a profound opportunity to harness sustainable design and societal values to inspire the next generation of commerce and create positive impact in the world.”

“Aspirationals are materialists who define themselves in part through brands and yet they believe they have a responsibility to purchase products that are good for the environment and society,” said Eric Whan, Sustainability Director at GlobeScan. “By engaging Aspirational consumers, brands can further the shift toward more sustainable consumption and influence behavior change at scale

Key characteristics of Aspirational consumers include:

  • Strength in Emerging Markets: Countries with the largest populations of Aspirational consumers include China (46%), Nigeria (45%), Pakistan (44%), India (42%), Australia (41%), Canada (40%), Indonesia (38%), Greece (37%), France (36%), USA (36%), Turkey (35%) and the UK (34%).
  • Trust in Brands: Nearly six in ten Aspirational consumers globally say they “trust global companies to act in the best interest of society” (58%), compared with 52% of all consumers;
  • Positive Influencers: Nearly nine in ten Aspirational consumers say “I encourage others to buy from socially and environmentally responsible companies” (88%), compared to 63% of all consumers;
  • Responsible Consumers: Nine in ten Aspirational consumers say “I believe we need to consume less to preserve the environment for future generations” (92%),  ompared to 75% of all consumers, and that they are “willing to pay more for products produced in a socially and environmentally responsible way” (91%) compared to 64% of all consumers;
  • Young and Urban: Demographically, Aspirational consumers make up the largest percentage of Millennial (40%) and GenX (37%) generations, compared to 32% and 33% in the general population, respectively, and nearly six and ten (59%) live in cities;

“For decades, green marketers have been speaking to the wrong consumers, assuming that by engaging the most committed ‘advocates’ we would create significant business growth, cultural relevance and change at scale,” Bemporad added. “What makes Aspirationals so compelling is that they combine an authentic commitment to sustainability with a love of shopping, design and social status, aligning economic, cultural and social forces to shift the way we shop.”

“With 2.5 billion consumers worldwide, Aspirationals offer an important opportunity to redefine sustainable consumption,” said Mark Lee, Executive Director at SustainAbility. “Like never before, brands can engage Aspirationals to pioneer new models and practices that can deliver economic growth while reducing negative impacts on the environment.”

 Background and Methodology:

The 2013 Aspirational Consumer Index is an in-depth survey of consumer attitudes, motivations and behaviors relating to sustainable consumption among participants across 21 international markets. In total, 21,492 citizens in Argentina, Australia, Brazil, Canada, China, France, Germany, Ghana, Greece, India, Indonesia, Mexico, Nigeria, Pakistan, Peru, Russia, South Korea, Spain, Turkey, the United Kingdom and the United States were interviewed face-to-face or by telephone between December 10, 2012 and April 9, 2013. Polling was conducted by GlobeScan and its research partners in each country. National representative samples were used in all the countries except in Brazil, China, Indonesia and Turkey, where the surveys were conducted in urban areas. The margin of error per country ranges from +/- 3.0 to 4.9 per cent. Population of Aspirationals globally is based on the integration of census data and the percentage of Aspirational consumers reflected across the 21 markets surveyed.

This article is an except from CSR Wire, BBMG: 2.5 Billion Aspirational Consumers Mark Shift in Sustainable Consumption