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Fashion Will ‘Weed Out’ Brands Failing on Supply-Chain Transparency

Increasingly, consumers are investigating the impact of their purchases, including the environmental and social cost of production. To keep up with this appetite for information, companies need to raise the level of visibility into their supply chains.

During a panel at Fairchild Media Group’s Virtual Tech Forum last month, moderated by Sourcing Journal editor in chief Pete Sadera, speakers shared how they are addressing the growing demand for data about the origins of products. As life was turned upside down during the pandemic, some consumers found their attention pulled away from sustainability, but that has changed in the recovery. “Maslow’s Hierarchy of Needs came in and was all about being safe, healthy and getting through the pandemic. But we’re seeing it come roaring back,” said Paul F. Magel, president, business applications and technology outsourcing division at CGS. And in addition to consumer demand, recent regulations are further driving the need to track garments back to the source.

Jennifer Crumpler, fiber development manager and e3 sustainable cotton program manager at BASF, compared what is currently happening in fashion to the farm-to-table movement in food. Each bale of e3 cotton is traceable back to the field. The three E’s represent social equitability, environmental responsibility and economic viability, and the company tracks eight different parameters—including water use, pesticide use and worker health and safety—to cater to the wide range of definitions for sustainability. E3 can also customize the data it is pulling depending on partner needs.

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Part of what is driving more traceability is greater collaboration along the supply chain. “Silos are being broken, and those who maybe aren’t willing to have the transparency…[are] being weeded out,” said Crumpler. She added that e3 is working to align the terminology being used to describe a bale of cotton so it simultaneously works for farms, suppliers, brands and consumers.

In addition to agricultural traceability, companies are seeking out more information about production. The Shop Floor Control product within CGS’s BlueCherry software suite has typically been used as a productivity measurement tool. While output analysis remains important, today the tech company is seeing customers use its data collection capabilities to track factory compliance, including assuring that goods are not being subcontracted to non-compliant facilities.

To enable more information sharing, companies need to have the capacity to analyze and correlate data points. Along with helping firms collect data, CGS’ systems tag information so it can then be reported and disseminated via their website or product labels. “The world doesn’t lack for data; there’s data everywhere,” Magel said. “And sometimes, that data is in a file cabinet, sometimes it’s in a database, sometimes it’s in somebody’s head. The real task is really connecting it all, and then making it available.”

Per Besim Özek, strategy and business development director at denim mill Bossa, traceability is already an expectation rather than a differentiator, since brands want to see the data. Some retailers will even establish ultimatums, asking suppliers to prove a specific target has been met—such as lowering water consumption—to retain their business. Bossa has taken an open-book approach and is sharing information on its dyes, energy sources and recycled content use. For organic cotton in particular, Bossa provides QR codes to its customers so they can learn about the farms’ names and locations, as well as details like where the seeds come from and the growers’ use of irrigation. In addition to sharing data with customers, Bossa also discusses its methods with others in the denim industry.

“We do believe that for the future of the world, if we are doing something good for the sustainability, it shouldn’t be a best-kept secret,” Özek said.

Bossa is part of Reformation’s traceable denim supply chain, which uses FibreTrace to follow cotton from the field to the final customer. Physical traceability solutions—such as DNA or mineral-based tags—range in price, with some adding 25 cents or more per meter of fabric. However, Özek sees the costs coming down in the next few years as the technology matures.

Also making up for these added costs is the price premium that comes along with verification. According to Magel, consumers have said they are willing to pay about 25 percent more for sustainable goods, and e3 has seen brands successfully test higher prices for jeans made with traceable cotton. The e3 program then passes some of this premium on to its enrolled farmers.

“Nothing can be done without the economics,” Crumpler said. “And what we really do and what we’re really striving to do is…[bring] value back to our farmers and what they’re doing on their farm and rewarding them for what they’re doing to help others downstream to make a claim on an item or a garment.”