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Can Your Brand be Sustainable if You Use a Middleman?

In the garment industry’s ongoing race to the bottom, egged on by consumers demanding cheaper prices, sourcing companies like Li & Fung are often slammed for steering the way.

Armed with networks comprising thousands of third-party suppliers around the world, these manufacturing middlemen help apparel brands and retailers produce goods quickly and cheaply, and there’s no guarantee an order will be filled by the same factory twice, which can make traceability tricky.

But don’t assume all mega-suppliers have wholly unsustainable supply chains.

Li & Fung, criticized at length by the likes of The New York Times in recent years for its ties to several high-profile factory disasters, said it’s been working to make its massive supply chain more sustainable. According to its website, the firm’s sustainability strategy focuses on managing risk and furthering compliance, collaborating with customers and industry partners to build better supply chains and sourcing responsibly.

Find that hard to believe? Don’t.

During a Q&A following a recent discussion about the future of the fashion industry, co-hosted by Project Just and NY+ Acumen at Fordham University School of Law in New York, an attendee asked the panel for tips. She identified herself as a designer working with a mass-market apparel brand that’s a current customer of Li & Fung and she needed some advice on how to approach the sourcing agency about disclosing more information about its suppliers.

Panelist Maxine Bedat, co-founder and chief executive officer of Zady, an ethically minded e-commerce site, quite simply told her to talk to the company.

“I think you would find that the door would be open,” she said, sharing her own shock at the World Retail Congress in April to hear Spencer Fung, group CEO of Li & Fung, speaking about environmental matters. “Apart from me, he was the only person in the entire World Retail Congress speaking about the environment—I thought he would be the last person!”

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She added, “I think that there is a real opportunity there, because they are so entrenched in the supply chain they see the issues first.”

Dr. Leo Bonanni, CEO of Sourcemap, a supply chain-mapping software company, agreed. “Every day we have brands asking Li & Fung to disclose dye houses, and every day Li & Fung answers,” he said.

Bedat continued, “It lies on citizen consumers to make the right choices so brands are motivated, knowing that their customers are going to go away unless they make these changes, and then it lies on brands themselves to then have that conversation with Li & Fung.”