Sustainable and Ethical Manufacturing

 

Sustainable and Ethical Manufacturing

Ensuring that everything in your supply chain exceeds the minimum statutory requirements of the country you are doing business in. This applies specifically to people. Ensure the price you pay allows workers to be paid in excess of the minimum wage allowed. Ensure working hours are reasonable and are less than the maximum allowed. Ensure that your supplier’s safety standards exceed the minimum standards. Essentially, workers should be safe and earn a decent living wage.

There are a number of Ethical manufacturing / Sustainability certification standards and organization out there, such as Greencircle, World Fair Trade Organization (WFTO), Worldwide Responsible Accredited Production (WRAP), Fairtrade International, Flocert, Ecocert, Fairwear Foundation, Rainforest Alliance, Goodweave, Social Accountability International (SAI), Global Organic Textiles Standard, Sedex Members Ethical Trade Audit (SMETA), etc.

Image source Fair Trade Certified

In fact, there are so many certification and standards for different industries.

 Sourcing Playground is working with the most respectable and trustworthy of these key industry certification bodies to ensure that any supplier certification claims can be trusted and verified. (WFTO, WRAP, SAI among others). 

Sourcing Playground is looking to create trust and transparency to help make it easier for buyers make more informed sourcing decisions, which will result in them choosing better, compliant suppliers. 

Buyers can easily see which suppliers have social, ethical & sustainable credentials and Sourcing Playground verifies suppliers claims.

For suppliers, these benefits include;

· Cost reduction. To many seems counter intuitive, as they need to pay for accreditation. But there are measurable cost reductions. For example, installing energy efficient lighting in a factory reduces energy costs.

· A higher chance of getting orders. As pressure grows on buyers to produce with certified suppliers, certification gives suppliers a much higher chance of getting an order, when the buyer is doing supplier comparisons. Certified suppliers will stand out. Certification by its very nature, gives a buyer an impression of a more reliable supplier.

· Increased efficiency. By reviewing your factory’s processes, it is very likely that inefficiencies will be uncovered, and improved upon. This results in further cost reductions.

· Exceeding local regulatory requirements. Which means that there is almost zero chance of your operations being disturbed due to non-compliance with local laws. If operations are disturbed, money is lost.  As an example, two years ago, hundreds of dyehouses in Fujian, China, were shut down due to pollution. Not only did some close for good, but many could not produce for months. This had a massive knock on effect on the entire supply chain. The financial losses were huge for both suppliers and buyers.

· Tax Incentives. Many countries offer tax incentives to factories or businesses that are certified as sustainable. As a result, certified suppliers pay less tax. Less tax means more profit.

Suppliers will need to be educated about these benefits.

The reason many suppliers don’t get accredited, is because they see it as a large cost, which will result in price increases for their products, making them noncompetitive. 

However, in most cases, if done correctly, costs will be reduced, resulting in no price increases, or at worst minor ones. This is probably the key area of educating suppliers that needs to be addressed.

As pressure grows on buyers, they will not have an issue paying a minor upcharge for accredited suppliers.

We believe that by doing this in an honest and transparent way, we will exert a soft influence on suppliers to get accreditation.