Fashion supply chains have traditionally been complex and opaque. But some frontrunners are leading the charge to gain a better understanding of their suppliers and eliminate uncertainty through science and technology.
This period in supply-chain traceability mirrors the evolution that has happened in e-commerce in recent years. High-end brands once thought they could avoid selling online, but as consumer behavior changed, the ability to hold out on e-commerce all but disappeared. Just as digital sales transitioned from a nice to have to a need to have, labels will soon face a greater impetus to instill traceability from raw material to retail.
“Raw material traceability is the foundation of everything,” said Marc Lewkowitz, president and CEO of Supima, the promotional brand of U.S.-grown American Pima cotton. “If you don’t know where your materials for your products are coming from, you really can’t talk about sustainability. Without knowing intrinsic details of what you’re using, you’re kind of flying blind.”
Per Lewkowitz, origin authenticity unlocks the ability to talk about aspects such as how a material was grown, including water usage, farming practices and land management.
Because of the unpredictable element of nature in the agriculture space, which can change the results and traits of crops, the cotton supply chain has favored flexibility and the ability to source from a wider range of growers depending on a mill’s needs. But this has led to a supply chain that is typically far from transparent.
Aside from agriculture practices, brands need to know their supply chain inside and out to avoid social responsibility violations. This is particularly significant now due to human rights issues surrounding cotton production in the Xinjiang Uyghur Autonomous Region of China and in Uzbekistan. In the case of Xinjiang, pending legislation in the U.S. means that companies could be facing the burden of proving to Customs and Border Protection that their products weren’t made under forced labor.
“If you look at the Xinjiang issue, and how that’s developing, I think that is going to be a fundamental driver in how businesses approach the responsibility of having authenticity as a cornerstone of their business,” Lewkowitz said, drawing a comparison to the impact of Rana Plaza on social responsibility.
Brands recognize that they need to ramp up their transparency. In a 2019 study from McKinsey & Company, apparel sourcing executives named traceability and transparency their second biggest objective.
About seven in 10 respondents said they believe product-level information about raw materials’ path from fiber to retail would likely be communicated at most points of sale by 2025. However, there is still much progress to be made in the next five years, since currently only one in 10 companies discloses the source and supply chain of their claims on sustainable fibers.
Supima is working to advance traceability for its brand partners, and has linked with forensic firm Oritain on a cotton origin verification project. Oritain was specifically chosen because its scientific process doesn’t require any markers or tags to be added to the fibers. “We can use Mother Nature and the forensic technology to use the trace elements that the fiber picks up naturally while it’s growing,” Lewkowitz said.
While Kering, Albini, Oritain and Supima kicked off the program authenticating Supima cotton back to the origin of production, other brand partners are also coming on board, as greater insight into products and their authenticity is the next step to driving better and smarter business practices.
For companies that are ahead of the curve and have gone the extra mile to invest in supply chain knowledge, it becomes an added value proposition for the customer. Establishing this knowledge and oversight of the supply chain also provides consistency in the end product and removes uncertainty in the supply chain. Over time, delivering on authenticity, transparency and quality improves customer retention, with 94 percent of consumers in a Label Insight survey saying they are more apt to be loyal to a fully transparent brand.
Even with the potential benefits, not every brand will get on board with responsibility efforts, much like there are still a few e-commerce holdouts. Some companies will opt out of traceability endeavors due to costs while others may balk at what looks like a daunting task. Charting the entire supply chain is much more complex for a company with thousands of suppliers than one that works with a handful of sourcing partners or owns its own production. Still others will be discouraged from adding this level of sustainable messaging to only one product or category, believing that it will negatively impact the perception of other goods they sell that do not have the same level of transparency.
It is going to take time to bring authenticity up to scale, particularly for companies with broader product assortments. The process of engaging partners and getting to intricately know the supply chain can take more than a year. But the important thing is starting somewhere.
“You’re not going to be able to do everything all in one shot,” said Lewkowitz. “You can’t go from not knowing the supply chain to knowing the supply chain for everything overnight. But by taking those first baby steps, that sets the bar and the standard.”
Want to hear more about Supima’s traceability work? Lewkowitz will be speaking on a panel with executives from Oritain and Albini Group at the Sourcing Journal Summit 2020 on Oct. 14-15. For additional information about Supima, click here.