Skip to main content

Why Fashion Must Take Supply Chain Transparency Past Tier 1

The fashion industry has traditionally been highly opaque, but pressure is mounting to have more transparency about each stage in the supply chain. From regulatory demands to consumer attention toward sustainability, brands require visibility to know their true and full impact and work toward reducing apparel’s environmental effect.

“As an industry, we have a pretty sizable amount of impact, even though it’s only maybe 2 to 3 to 4 percent of the entire impact of carbon on the planet,” said Kevin Myette, director, global brand services at Bluesign, which acts as a third-party partner to assist companies in achieving sustainable progress.

Due diligence legislation—such as the proposed New York Fashion Sustainability and Social Accountability Act—is making it a necessity to know supply chain details, down to the facility level. During a recent Sourcing Journal webinar, Myette explained that most companies know their tier 1, or finished goods suppliers, but awareness of tier 2 and beyond is lower. According to Bluesign’s assessment of its own customers, almost half of brands studied have limited knowledge of up to 50 percent their tier 2. Complicating visibility further is subcontracting. While subcontracting disclosure policies are common at tier 1, it is far less likely to have these agreements in place for tier 2.

“Do you know your supply chain? One of the hardest things you’re going to deal with as an organization when you try to understand and unpack this is how much honesty are you going to get from that supplier,” said Alex Lauver, director of commercial innovation at outdoor gear brand Outdoor Research. “In many cases, your relationship with that supplier will dictate how honest they are with you and how transparent they are.”

Related Stories

Although tier 2 might be less well-known to brands, it is a significant focus of Bluesign’s work due to the impact tied to chemicals and water used for wet processing. To truly make a difference, however, companies cannot target an individual piece of the supply chain. Myette gave the example of negating the benefits of using recycled materials with the processes involved in tier 2. Sourcing Journal

There is also a knowledge gap around textile volumes, with only half of brands saying they have full understanding of these figures. Textile amounts are often measured in units such as yards, but to get a true sense of impact, companies should instead be tracking fabric volumes by weight, such as kilograms.

Myette noted that much of the effort to better know a supply chain comes down to “operational excellence.” Rather than starting with sweeping goals around aspects like carbon reduction, Bluesign begins new client engagement by identifying key immediate priorities that create a foundation to then set targets. One example is establishing supplier agreements. Lauver added that once working with Bluesign, the action plan put in place had unexpected benefits beyond environmental health. “All of these things support and better your business in addition to supporting and bettering the earth,” he said.

Having a clearer view of your supply chain also has implications for consumer-facing communications. Lauver pointed to consumer studies that have shown customers place more trust in brands than in the government. “As a brand or a company, it’s your responsibility to make sure your story is accurate and that you’re doing a good job, and whatever you decide to market, that you’re appropriately educating your consumers as to why you think it’s important so that they understand that, and then it becomes important to them,” Lauver said.

Myette warned against oversimplifying sustainability messaging, encouraging companies to tell a big-picture story. “Some of the most important actions you can take in sustainability are the least sexy,” Myette said. “However, being able to tell the story is also very, very important because it increases awareness of what really matters.”

Watch the webinar on demand, sponsored by Bluesign, to discover:

  • Why all companies can stand to boost their efforts in supply chain oversight
  • How Bluesign works with companies to peel back the curtain on opaque supply chains
  • Insights from Bluesign’s brand assessments
  • How to begin the journey to better knowing your supply chain
  • Best practices for setting sustainability goals

Click here to watch the webinar.