The results are truly shocking. Give arguments to support the statement that Wal-Mart has achieved very good strategic fit between its competitive and supply chain strategies. Nevertheless cotton, a natural fibre, makes up a large percentage of its apparel range, even though it remains a labour and resource intensive product. A supply chain strategy is the overarching plan that an organization uses to manage the flow of goods and services, from sourcing raw materials to delivering products to customers. Should Primark be more open with consumers concerning sustainability? Primark maintains it is able to keep its prices so low because all of its orders are placed in bulk and not because its does not pay its workers enough. TheIllustration 1: Supply chain management company has recently joined with 40 other brands such as Adidas, Nike, Disney, Mark and Spencers and Burberry. I know people will often say that the quality isnt very good at Primark, but we have invested a lot in quality over the last few years, says Stewart. But now our customers are asking us about it, so we are talking about it moreespecially now that our customers are getting older, they want to know more. Over the years Primark has implemented a series of strategies and initiatives which vary from improving the livelihoods of its garment workers, to reducing its carbon footprint as well its chemical usage, water usage and waste output, to using more sustainable materials. Brands can work very hard on improving their purchasing practices - on forecasting, on production planning all of which can reduce their risk of causing overtime - but if they are a small player and other brands have poor management practices, the results on the factory floor can still be disappointing. Sustainability is a complex issue, stresses Jacinta FitzGerald, Head of Research at Project JUST 3. Primark has already begun to train 5,000 new cotton farmers and plans to scale this up in time. In doing these things well we know we contribute to making millions of people's lives better," says George Weston, Chief Executive Officer of Associated British Foods, parent company of Primark in ABF 2016 Corporate Responsibility Update. Implemented by Dhakas BRAC Universitys Center for Entrepreneurship Development in collaboration with BRAC USA, the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and C&A Foundation, the Digital RMG Factory Mapping in Bangladesh (DRFM-B) project is the first of its kind to attempt to digitally map the entire garment industry in Bangladesh and marks a critical industry shift toward more transparency. Partners have extended from bodies such as the Ethical Trading Initiative to organizations monitoring industry standards, notably the International Labor Organizations Better Work program.. I believe it is more important to show, as transparently as possible, proof of the good we have already done, than to set a target of what we may do in the future, However, others disagree and argue transparency, as well as setting targets, are still not enough to make a real difference. In addition Primarks European stores donated a total of 100,000 cartons apparel goods to the European Red Cross Refugee Appeal 10 in 2015 to help refugees and migrants. The strategic plan of Primark consisted of the strategy of growing inorganically as well as organically. The video, which marks a first for the value retailer, shows what factory conditions are like for workers in Bangladesh. Use of chemical pesticides were reduced by 44 percent. Credit: Primark. Bangladesh posters: These posters were created in conjunction with workers, with support from SHEVA NARI O SHISHU KALLYAN KENDRA. Primark is using its global scale and reaching across its entire supply chain and its own operations to action the new strategy with nine key commitments, through three key areas. Will a Sustainable Future for Agriculture Take Us Underwater? However, in order to reach its goal of creating clothing with the least amount of harm done to the environment, the value retailer should be looking into additional avenues to increase its use of sustainable resources, as well as its use of recycled materials. We do share information on which countries we are sourcing from with the public, but not specific factories., Primarks battle against modern day slavery in its supply chains, Rather than cutting ties with suppliers who do employ vulnerable refugees, Primark works with suppliers and local partners to help them get papers for legal employment and proper payment. It is a shame that so much hard work of workers worldwide ends up as waste, Tara Scally, Dutch Campaign Coordinator for Clean Clothes Campaign (CCC) 11. Primark adds that it does acknowledge the inherent challenges in defining and calculating a living wage, but it believes that a negotiated approach remains the most practical and sustainable move and supports the development of all industrial strides taken to achieve this. The thing about Primark is that we communicate the things that we have done - rather than the things we want to do, explains Stewart. In September 2015, an ACT delegation, which consisted of IndustriALL and leading representatives from Primark, H&M and Inditex travelled to Cambodia to meet with suppliers, garment unions, the Labour Ministry and the Ministry of Commerce and the garment manufacturers association of Cambodia. Fair Wear Foundation 12 has done interesting research revealing the possibilities. As a leading member of ETI, Primarks Code of Conduct is founded on the ETI Base Code which stresses that wages and benefits paid for a standard working week meet, at a minimum, national legal standards or industry benchmarks, whichever is higher. This website uses cookies for analytics, advertising and to improve our site. Our experience is that transparency often can be among the most difficult requirements for companies that want to do good. According to WRAP, approximately 140 million pounds worth of used clothing is sent to landfills in the UK each year - accounting for 30 percent of consumers unwanted clothing. No matter what your budget, we have a great range of fashion and home accessories at affordable prices. At Primark, we're proud of our low prices. This is why Primark is developing the communication around everything in terms of ethical and sustainable programmes, to make sure it is as informative and visual as possible for its readers. The ranking awarded Primark points for having appropriate policies in place against excessive overtime, forced labour and child labour, but did not award any points to Primark later on, as they did not take sufficient action against alleged impacts of these issues. Best known for its low price and high value offering, "Amazing fashion, amazing prices", the high street staple has extended its reach across Europe and overseas into the United States. Primark will strengthen the position of women across its supply chain through skills development and addressing barriers to progression by 2030, by expanding current supply chain training programmes to reach more than half of all female workers by 2025 and 80% by 2030, extending its support for female worker career progression and promotion . As we launch the Primark Sustainability and Ethics Progress Report, we reflect on a foundational year, which was focused on developing the internal processes and programmes that will underpin the changes needed within Primark and across our value chain to deliver on our Primark Cares strategy. Photos: Primark Sustainable Cotton Programme. Credit: Primark. But now that we have a formula that we know works, we can start to look at how we can do that in different locations. For now Primark has chosen to localise their efforts in Northern India, but it has not ruled out expanding the programme to other countries. These audits, which can be announced before hand or not, include confidential worker interviews. But now, we are all sharing factories and therefore human rights has to be a prerequisite for us, as it should be for all., Although some may argue that not a lot seems to have changed within the fashion industry concerning the lives and rights garment workers since Rana Plaza, Steward disagrees. Our Primark Cares strategy is enabled by and underpinned by five key principles: Our commitment to ethics and human rights through our Code of Conduct and Supply Chain Human Rights Policy. Without confidential worker interviews, many of these workers who fear losing their jobs - usually their only means of an income - may never share their real working experience with suppliers clients. It is about sharing how we do it and then moving it to scale. Primark also ensures its suppliers use a streamlined production process to make its clothing in the most effective way possible. Although it is grown on large-scale industrial farms in certain regions, in most cases the cotton used to make textiles and apparel comes from small farms in low-income countries, such as India, China and Pakistan. An improved sales, inventory and operations planning process to ensure continuity of supply in line with your customer . Its one of our challenges we have to deal with. One key avenue Primark has been experimenting with to better communicate their ethics to consumers is video. The company's strategy of focusing on six core supply chain principles resulted in performance benefits that really paid off: customer service improved from 97 to 99 per cent, direct customer shipments increased by ten per cent and productivity increased by 30 per cent. They include decision-making and analytical processes that define roadmaps for products, services and market interactions. Primark also conducts energy audits in all its stores and reviews how much energy each store consumes. I dont care really, I love this jacket.. A quick Google search shows exactly how fast Primark haul videos are growing in popularity - with 3.63 million results showing up for Primark haul 2017 versus 2.95 million hits for Primark haul 2016. Many of these videos attract millions of views - for instance YouTube favourite Zoellas latest Primark Haul, entitled The Biggest Primark Haul I've Ever Done, was uploaded on March 21, 2017 and already counts over 2.6 millions views. This means we get the savings from buying in bulk, explains Stewart. Four factors usually influence an organisation's supply chain strategy for the supply chain models they use: Industry. For us its about making sure that the people who touch the supply chain, whether its the workers or the communities or the environment we operate in, are looked after.. Primark will then follow up with the factory in question at a later date, either through a pre-announced check or a spot-check, to ensure the issues have been handled effectively. Strategy No. Credit: Primark, Video: Primark - There is nothing like us on the high street. . It is mainly sourced from countries like China, India, Pakistan, Turkey, Brazil or the United States. This plan ensures that every phase of the supply chain is optimised through supply chain excellence, including the sourcing of materials, manufacturing, delivery, and logistics management. Primark Stores Limited has devised an effective market positioning strategy. In addition, the Irish retailer launched the Pashe Achi Project to ensure compensation recipients retain access to their financial compensation and understand their rights. However Primark does not tackle its factory audits alone. Credit: Primark. Primarks Code is much in line with Fair Wear Foundation Code of Labour Practices, points out Lotte Schuurman, Communications Officer at the Fair Wear Foundation 5 (FWF). Since then Primark has continued to work with local partners and non-profit organisations to ensure any funds or support they gave to workers and their families would be secure by offering financial advice and guidance. All the stock we have in store which we cant sell, all our buying office samples and excess stock, is donated to Newlife. Primark first started working with Newlife in 2010, and since then has managed to generate more than 2 million pounds in donations, which has been used to purchase equipment such as wheelchairs, nurse services and fund medical research. Taking into consideration fast-fashions current business model, which is focused on high volume, low price and disposable products, this cannot by definition nor intention, go hand in hand with sustainability, she adds. Photo: Primark Employees at Primark Den Haag. 3 Supply Chain Strategies: Which is Best for Your Business? This written down reality says nothing about what is really happening within the supply chain. It turned out to be such a success that the participating farmers achieved the following results by the third year: This short film follows the impact Primark's Sustainable Cotton Programme has had on female farmers in Northern India and includes interviews with some of the women involved. Primark has also committed to pursuing a living wage for workers in its global supply chain by 2030. Instead, they receive external feedback from Primark and a checklist of areas they may need to improve on going forward. NGOs and trade organisations agree that this, as well as working with trade unions, is key for any fashion retailer in tackling cases of forced labour in developing countries. Brands like Primark should use their power to make sure union members are protected. Scally also encourages Primark to join a multi-stakeholder initiative, like FWF, who can verify what is really happening in the supply chain. Primark has a large range of products from men's wear, women's wear, children's wear, accessories, footwear, lingerie, home wear, hosiery and much more. . The first stage in Primarks supply chain is harvesting the cotton. Introduction to Operations and Supply Chain Management (Cecil C. Bozarth; Robert B. Handfield) Signals and Systems (Simon S. Haykin; Barry Van Veen) . The one in the UK, which covers all our European stores, is Newlife 8, a foundation which supports children who are either terminally ill or very physical disabled, explains Stewart. But what could Primark film to convey its good ethics in simple and clear way? The programme covers key issues workers should be aware of, such as health and safety responsibilities, hazard identification, and manual handling. Milan, Italy Primark in-store photo. "Our continued partnership with Primark as part of this industry-leading programme is materially changing the lives of farmers and their families in rural cotton communities," Ward concluded. Is Primark doing enough in terms of sustainability with its excess stock? After reaching out to the shoppers who found these letters and labels and conducting its own research, Primark claimed the distress calls were all part of an elaborate hoax looking to sully its name. In early 2016, the retailer started a new partnership with the Department for International Development 13 (DFID), which sees the two combining their presence, networks and expertise to boost the overall wellbeing of their workers in five of the retailers key markets - Bangladesh, Pakistan, Burma, Ethiopia and India. But we have been very pleased with the trial and our decision to roll it out. Stewart notes that they may have to adopt a slightly different model in the US due to legal reasons, but they aim to have a similar system in place overseas. The value retailer has had a similar system in place in the UK for a number of years now, which ensures all recyclables are collected from its stores via its delivery trucks and transported back to the central distribution centre. So now we have implemented our Farmer Field School to help them manage their own income and run their own businesses. By offering these female farmers advice and guidance on how they can best manage their income and oversee their cash flow, Primark aims to ensure the cotton workers become financially independent. Finally, the issues of supply chain resilience and sustainability are discussed. As these results show, the company is doing well. Primark will continue collaborating with industry experts such as CottonConnect to drive this change. India currently ranks 130 out of 188 countries in the UNs Gender Inequality Index, as gender equality is seen as one of the most pressing development challenges facing the country. Another programme that Primark has had in place since 2009, focuses on enriching the lives of its workers, and sees the value retailer working together with Social Awareness and Voluntary Education 4 (SAVE) to educate its workers in Southern India. In the supply chain strategy you are going to plan out how you are going to work with distributors, customers and suppliers. As of FY2016 it operated 325 stores in 11 countries - Primark does not have an online store. Unlike other clothes shops, people often come to Primark because they know theyll be able to afford a whole outfit. 1: Inventory and capacity buffers Buffer capacity is the most straightforward way to enhance resilience, whether in the form of underutilized production facilities or inventory in excess of safety stock requirements. They discussed a number of HR-specific trends, including . We know consumers and stakeholders are interested and we thought that publishing the Global Sourcing Map was a big step on that journey. These posters depict the separate principles of the Code of Conduct in a cartoon-style images which can easily be understood by all workers. Primark is pursuing a living wage for workers in the supply chain and support with financial literacy training and access to social protection by 2030. The Central Supply Chain Team is accountable for critical activities like planning, data & analytics, operational excellence, supply chain business systems development and . The value retailer states it is targeting efforts in certain countries where national safety standards differ from its own standards, but does not outline in detail which countries it is focusing on at the moment. To maintain this strategy Primark always focuses on buying, logistics and supply chain management. Published 5 years ago. They concentrate on improving the efficiency of supply chain management. What impact does Primarks Code of Conduct really have? Its still early days, but its going very wellthe whole process is a journey of understanding. And in Portugal, the retailer is considered a fashion expert. We can pre-empt where practical, supply chain risks and propose alternative sources if and when required. The company therefore lost half a mark under Anti-Social Finance. As Primark has also expanded into new regions over the last few years, the retailer has ensured that all its new locations are supported by safety specialists who help uphold its safety standards. Consistently providing a wide variety of goods at low prices . What certainly has helped over the last two years is there has been more of an appetite to collaborate, says Katharine Stewart, Primarks Director of Ethical Trade & Environmental Sustainability. Circularity addresses the problem of increased consumption and disposal of limited resources. Primark has published the results of their sustainable cotton programme on their website, as well as personal stories from the farmers themselves, but Stewart admits the company is still learning on how to take what they have learned from the pilot all the way through to end production to bring it to scale. A link to the sourcing map is available here. However, although fast-fashion retailers like Primark have been working hard to improve working conditions and dramatically decrease their impact on the environment, in reality they have been unable to match their sales gains with corresponding improvements in terms of the social and environmental aspects. But with 98 percent of its factories also manufacturing products for other brands several of whom have begun to publish the details of their sourcing practices the company felt the time was right to share this information. The audits include onsite waste management practices, review of store emissions and ensuring all equipment is properly maintained. Primark is a member of the Sustainable Apparel Coalition. At the moment Primark does have a few initiatives in place aimed at educating consumers on how to care better for their clothes, such as their partnership with SCAP 8. The ERICC system offers real-time information on the primary energy drivers within any store and indicates how a store should be performing from an energy management point of view. Our reason for doing so is to control and retain the integrity of them. Usually suppliers contact an external party of their own choosing when conducting a factory audit. Verification is crowdsourced from the public to ensure that the information remains up-to-date and accurate. This wasnt a case of us not having the data, we know where our products are made. In addition Primark has joined a number of partnerships to ensure its products are made as sustainably and responsibly as possible, with as little harm to the environment. This strategy is pursued by companies selling affordable products across all sectors. Credit: Primark. Fashion supply chains tend to be very long and complex, involving thousands of workers across the board. For example Primark claims to not spend any money advertising and orders its products in large volumes well in advance, so they can keep their overhead costs as low as possible. Primark has been grappling with the best way to tackle this assumption over the past few years. Credit: Primark. In a word, Primark's strategy is working better than its rivals and . SM Insider Current Issue. In France, employees also complained of difficult working conditions in Primark, with complaints ranging from unpaid sick leave, to constant monitoring, to unexplainable gaps between sales assistants' wages 5. One of the key lessons learnt during the pandemic and its aftermath, is that there is a need for increased resilience in supply chains. Published Feb 16, 2018 4am EST / 1am PST / 9am GMT / 10am CET. This set of guiding principles is based on the internationally recognised labour standards from the International Labour Organization (ILO) Conventions 3 and the ETIs Base Code. Photo: Amsterdam Flagshipstore. Average farmer profit increased 247 percent during its third year. However, in spite of the numerous initiatives Primark has undertaken to combat its chemical usage, the value retailer may not be able to reach its Detox commitment to Greenpeace by 2020. Prospect Analysis Stores at Primark Discount fashion chain Primark has said it could face disruption from global supply chain issues into 2023, but it assured customers that "we are getting the goods we need". Origin coordination is critical with factories and suppliers. However, most of Primark's China factories are small and medium-sized, and fewer than 1% report having 1,000+ workers. That's why we work in partnership with global and local experts to help deliver change. Primarks sustainable cotton pilot supported 1,251 female cotton farmers over three years. But very often union members are threatened or fired for the work they do. We are big business and people talk a lot about us because we are big., Lets just level the plane and get rid of this assumption that paying more for an item somehow makes it more ethical - price is not an indication of good or bad ethics. If you go to a Primarks further up North, in Grimsby, UK for example you can see people are buying one or two things, not bags and bags of things - and we can see this reflected in our sales data. Because if you give someone an education, it stays with them and thats sustainable. She stressed that the cotton project focuses on giving farmers a hand up, not a hand down in the form of free seeds, or pesticides or equipment. Our engagement with . This short film explores the challenges the garment industry in Bangladesh faces as it. This does not do justice to the hard working garment workers, but into the production of the clothing. Primark does agree that it could be sharing more information on its sustainable and ethical practices with the public, even if consumers are not always asking for it. Combined, these tactics are said to ensure Primark remains accessible and affordable to all shoppers, while offer good value for money - a goal the company has always kept in sight, according to Primarks Director of Ethical Trade & Environmental Sustainability. Primarks Ethical Trade and Environmental Sustainability Team will be responsible for providing updates to the Primark Global Sourcing Map on a twice-yearly basis. For me, its really all about education. Over in the UK and in the US, Primark sales assistants have also shared concerns feeling overworked and underpaid, having to deal with overbearing management teams, as well as difficulty in taking time off, on job boards Indeed and Glassdoor. Nevertheless, Primark cannot argue with the fact that many consumers do shop excessively at Primark and are more likely to make an unnecessary, or unneeded purchase if the price is low enough. For example, Cambodia was the first country in which the ACT initiative began its first process to develop an industry-wide collective bargaining for higher wages. The new depot will serve as Primark's distribution centre for the Northeast, where the company plans to open eight retail stores by the end of 2016. Some factories need help improving certain areas, so we make sure we work together with them by explaining the implications and solutions on the audit checklist. Primark also runs an online supplier management system which offers training programmes on how suppliers can improve their working standards. However, the Government of Uzbekistan forces more than a million people 8 to work in the cotton fields each harvesting season and numerous reports highlight cases of human rights violations and forced child labour are rifein Uzbek cotton production. In addition Primark has also achieved the Carbon Trust Standard for Waste for its waste management systems in store and is working to assume direct control over as much of its recyclable materials used during packing and transport as possible. Primark employs a total of approximately 4,800 workers in the Netherlands. We actively engage with our suppliers, chemical experts, other retailers and organisations to help bring about sustainable change, states Primark in its Corporate Responsibility Report 2016. I just think its incredibly insightful because it follows the lifecycle of a product, from the cutting room all the way through the factory floor. Primark has shared the video on their website, under their Ethics section as consumers often requested what a supplier factory from the value retailer looks like. The steps Primark is taking to improve garment workers wages. As Primark has become more actively involved in the recycling process of its materials, it has been able to significantly reduce the volume and frequency of waste collections at each store and aims to expand this system to additional regions. The value retailer disagrees with this opinion, as Stewart says Primark has invested a lot in improving the quality of its garments over the last few years. Unlike fast-fashion competitors, such as H&M, who has been extremely open in communicating their sustainable initiatives to the public through campaigns such as Close the Loop, Primark has remained relatively quiet on what it does in terms of sustainability, ethics, and labour rights. Primark previously kept the details of its suppliers factories private, regarding it as a matter of commercial advantage. Its chief executive, Paul Marchant, said: "Our ambition is to offer customers the. The value retailer pledged to give both short and long-term financial compensation to those affected by the factory collapse and has paid a total of 14 million dollars to date - 11 million of which has gone to workers and families employed by its supplier, New Waves Bottom. Copyright Primark Stores LTD 2012. Crafting and Executing Strategy . 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