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Supply Chain Sustainability Gets Greater Attention as Consumer Demand Shifts

With consumers becoming more concerned about environmental issues, brands are increasingly making them aware of their sustainable sourcing and operating methods. Companies are also working on how to do that collaboratively—all while trying to figure out the costs of doing business more responsibly.

“Brands are still struggling to figure out what segments of their customers are aware enough and concerned enough about these issues that they are potentially willing to pay a higher price for a more sustainable product,” Ralph Lerner, senior vice president of commercial development at Virent, which is developing bio-based polyester, said.

Virent is a member of the new Plant-Based Products Council, which found in polling that 48 percent of millennials feel most guilty about their own plastic use compared to other resources, like paper, water or the how much they drive. A solid 64 percent said they were willing to use alternatives to plastic and 60 percent were surprised by the lack of alternative options to plastic.

A survey from the NYU Stern School of Business’ Center for Sustainable Business and data-analytics company IRI showed sustainability marketed products delivered 50.1 percent of market growth from 2013 to 2018, while representing 16.6 percent of the consumer packaged goods market in dollar sales in 2018.

“Across industries, companies are beginning to recognize that sustainable business is good business,” Tensie Whelan, professor at NYU Stern and founding director of Stern’s Center for Sustainable Business, said. “Results from this research reinforce the idea that embracing sustainability leads to better business results.”

Sustainability has properly permeated the fashion industry, too.

Global fashion search platform Lyst’s recent “Searching for Sustainability” report said there was a 66 percent increase in searches for sustainable fashion from a year earlier. Among Lyst’s ranking of the most searched sustainable products, Stella McCartney took the lead with the Stella McCartney x Stan Smith Faux-Leather Sneakers. Lyst said searches for Stella McCartney went up 21 percent since the shoe launched last September. French sneaker brand Veja felt the impact of Meghan Markle wearing its V10 sneakers in October. Searches for the vegan sneaker spiked 113 percent year-over-year since then. And searches for Allbirds, which introduced footwear made with Tencel a year ago, have grown by 170 percent year-over-year, according to Lyst.

Demand for sustainable denim has also grown. Weekday jeans made from 100 percent organic cotton were the most wanted jeans among sustainable denim this year, leading to an 80 percent increase in searches from September.

In order to tout their sustainable efforts, company’s must have a comprehensive plan of action. Esquel Group, considered a pioneer in sustainable textile and apparel manufacturing, told Sourcing Journal that its sustainability strategy focuses on four pillars: Planet, People, Product and Community.

“In practice, Esquel is devoted to reducing the environmental impact, investing in the staff, innovating the products and contributing to the communities in which the company operates,” the company said.

Transparency is at the forefront of Esquel’s sustainability commitment. In 2013, Esquel officially established its sustainability council to formalize and oversee the strategy and its implementation. The first sustainability report was issued in 2015, followed by an annual update of key data published online.

“It is clear that sustainable fashion is a growing trend that will bring profound changes across the supply chain,” the company said. “As an industry leader, Esquel strives to accomplish more than meeting the consumers’ standard, but also acting as an advocate of the environmental agenda in the textile and apparel industry. One early initiative is to build and maintain one of the largest wastewater treatment plants in China’s textile industry at the company’s Guangdong province site.”

Integral is another project that showcases Esquel’s commitment to pushing the sustainability agenda. The state-of-the-art textile manufacturing complex at Guilin, Guangxi, is set to commence full operations in late April this year. The site is a demonstration of how modern technologies, innovation and environmental sustainability can co-exist in perfect harmony. Esquel has positioned Integral as an Industrial Eco-tourism Garden to tell the story about how the company transforms manufacturing.

Asics has committed to reduce product-related greenhouse gas emissions by 55 percent globally by 2030 and will implement product recycling programs at eight of its biggest sponsored events in Europe in 2019.

ASICS Europe has partnered with I:CO–an innovator in the sustainable collection, reuse and recycling of clothing and shoes–to implement a program to enable the recycling and reuse of its products at eight marathons across the EMEA (Europe, Middle East and Africa) region.

“As a product driven company, shifting to more sustainable materials and engaging our customers and consumers on our journey to a circular business model are at the heart of our sustainability strategy,” Romy Miltenburg, manager of CSR and Sustainability EMEA at ASICS, said.

In introducing a comprehensive set of plastic waste reduction initiatives recently, Walmart said it’s all part of the way it wants to do business and send a message to suppliers and consumers.

The new programs are expected to impact more than 30,000 SKUs and expand efforts to reduce plastic waste in Walmart U.S. and Sam’s Club operations. Walmart said it encourages its suppliers to set similar packaging goals, with a focus on increasing material recyclability and easing the recycling experience for customers.

“As a global retailer that has set an ambitious aspirational goal to create zero waste, we fully recognize that reducing plastic waste by increasing packaging circularity is an area where Walmart can lead,” Laura Phillips, senior vice president for global sustainability at Walmart Inc., said.

Phillips said the new initiative marks a key milestone in the company’s “ongoing journey of working with our private brand and national brand suppliers to deliver access to high-quality, sustainable products as part of the Walmart everyday low price promise.”

Target has similarly ambitious goals and approach. In announcing a new set of goals that set carbon reduction targets for its entire supply chain, “where 96 percent of greenhouse gas emissions related to our business come from,” the company said the key will be unifying its suppliers around these same goals. That includes raw materials that create products, manufacturing and transportation.

Brian Cornell, chairman and CEO of Target, said, “We have a responsibility to our guests and the environment to set high expectations and encourage ambitious reductions in greenhouse gas emissions, promoting positive change throughout the industry.”

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