New Look, Asda George, Gap Inc and Next led the way in sharing their experiences of improving their purchasing practices at an ETI roundtable discussion last week (10 December 2009), attended by senior buyers, merchandisers and ethical trade teams from more than 20 global retailers as well as ETI NGO and trade union members.
There is now a wealth of evidence that many retailers' buying practices (eg how suppliers are selected, lead times for orders), are hindering suppliers' ability to provide decent pay and conditions for their workers.
In this specially convened discussion for ETI members and invited guests, leading brands talked candidly about how they are tackling this issue.
Among the experiences shared was that improving buying practices can not only help in tackling workers' issues like wages and excessive overtime, it can also deliver efficiency gains that benefit the bottom line. One high-volume garment retailer said that after helping its supplier improve its production processes at the same time as providing supportive buying practices, workers' wages have risen and turnover has dramatically fallen.
Several common themes emerged during the discussion, including:
- The importance of having a clearer critical path for each product line.
- Building two-way communication with suppliers. Rather than just handing down demands for compliance, retailers should ask their suppliers what they can change that will help a supplier or factory to improve.
- Establishing tools and guidance for designers, buyers and merchandisers, and making sure they are implemented consistently across the business.
- Smoothing out peaks and troughs in ordering from suppliers.
- Helping suppliers improve their forecasting, for example by giving suppliers earlier sight of the order book. For one of the brands, forecasting yarn demand has also helped.
- The importance of integrating purchasing practices initiatives across the business.
Brands described the range of tools they had each developed and found effective, including balanced scorecards for buyers; training for buying teams and other related functions; and the nurturing of ‘ethical champions' within buying teams.
The initiatives shared by New Look, Asda George, M&S and Next have been developed in consultation with ETI trade union and NGO members as part of ETI's Purchasing Practices Programme.
Attendees were introduced to ETI's Purchasing Practices Programme and the principles that underpin it, along with ETI's new Management Benchmarks for measuring companies' progress in implementing the ETI Base Code, including the recently announced Foundation stage.
ETI will continue discussion of how changes to purchasing practices can benefit workers, and specifically help increase wages, at its AGM on 21 January 2010.