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Sourcing efficiency is key to success, and WRAP can help

By: Bonnic Chung (bchung@wrapcompliance.org)
Sep 6

With the speed and complexity of today’s global fashion industry, the business success of international fashion brands depends not only on maintaining good product quality, competitive prices, and efficient lead times, but also on devoting more attention to social compliance and environmental issues. Thus, sourcing managers have to change the way they handle sourcing and operations at different stages of their business.

In the past, brands had put together their codes of conduct and abided by a “comply-or-die” model with the factories they did business with. Brands used their own or 3rd party auditors to inspect the factories to ensure they were socially compliant before their buyers started placing their orders. This resulted in what is known as “audit fatigue,” with factories having to go through multiple audit cycles and suffering from putting additional resource to handle these audits, and often times needing to bear the audit cost themselves.

In recent years, brands have started to realize that relying so heavily on compliance audits does not necessarily prove to be productive and effective because factories are dynamic place with their own challenges. Many have begun to change their approach by giving the factory chances to get progressively better, a process known as “continuous improvement,” which results in a better path forward. In addition, some buyers are also recognizing that there are best practices they can share with their vendor base and additional resources available in the form of experienced partner organizations, such as WRAP, or other entities like trade associations. This collective approach not only leads to cost and time saving in their sourcing process, but also reduces the number of audits by different buyers.

WRAP is the world’s largest independent factory-based certification program in the social compliance sector, focused on the sewn products industry. The program receives recognitions from nearly 300 buyers (brands/retailers) worldwide and has over 2,400 factories, employing 2.2 million workers, currently certified in more than 40 countries. This provides a large vendor base for fashion brands and retailers who want to work with socially compliant factories in any part of the world. The WRAP program consists of 12 principles which covers not only the labor conditions but also environmental, custom compliance and security. This benefits factories who are exporting to international markets by enabling them to demonstrate their compliance with not just social responsibility but also with the export requirements.

How can WRAP help?

International sourcing managers are constantly looking for new suppliers. Once they have shortlisted some potential vendors or factories, a lengthy screening and negotiation process usually has to take place before orders can be officially placed. WRAP can provide some options to shorten this sourcing process. The 2,400+ WRAP certified factories in the world can serve as a list of facilities that have already been screened for one key component – social compliance – and thus provide a ready shortlist for sourcing managers to consider. There are two ways forward for buyers who want to source directly through WRAP certified factories. First, they can view the list of certified factories on the WRAP website. This list, which includes all facilities that have authorized WRAP to publish their names, provides very basic information about the facility’s location, but does not contain any factory contact information. So, for sourcing managers who don’t have local resources to follow-up with, they can consider the second approach by making use of a free email blast service WRAP can offer on a discretionary basis to support buyers’ sourcing needs.

WRAP can send out an email to certified factories with information about the buyers’ needs and the contact information of the buyer. Factories who can meet those needs can then contact the buyers for direct negotiation on the business transaction. This service is particularly helpful and efficient for buyers with an immediate need to look for a specific product. As a recent example, a vendor who was urgently looking for swimwear factories in South China contacted WRAP and requested the email service; they receive feedback from potential factories within a few days.

This value-added service WRAP provides builds a sourcing link between buyers and factories in an effective and efficient way (and best of all, WRAP does this for free; there is no fee nor any commission on the transaction). Buyers only need to focus on the business part when they are dealing with socially compliant factories, and factories can concentrate their efforts to keep an on-going maintenance of their social compliance systems, to ensure product qualities and production process.

In this competitive world where there is no space for duplicating efforts, efficiency in production and sourcing is the key for survival and growth, and WRAP can help both sides of the supply chain with maximizing their success.

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