A new study by McKinsey confidently forecasts that a more sustainable supply chain for the apparel industry is just five years away, while simultaneously highlighting the intense pressure that will fall on all practitioners in procurement jobs and supply chain jobs to make this aim a reality.
McKinsey’s survey, ‘Fashion’s New Must Have: Sustainable Sourcing at Scale’, polled chief procurement officers who represent sourcing value of around £78bn between them.
These executives believe that four key factors are crucial: transparency, extending the implementation of sustainable materials, more defined relationships with suppliers, and overhauling best practices for purchases.
The report emphasises that while the drive for sustainability has been predominantly consumer-driven, the practical burden of realising the transition will fall squarely on the shoulders of CPOs and teams of procurement professionals, from permanent professionals to procurement and supply chain interims.
As McKinsey partner Karl-Hendrik Magnus put it: “Sustainable sourcing at scale is moving form a nice-to-have to a must-have.”
Consumers want to know details of origins, factory conditions and modes of transport before they make purchases, from linens to hemp to cotton.
The pressure on professionals working in procurement and supply chain jobs in the industry cannot be overstated: they will be walking a tightrope in the coming five years between the relentless imperative to sustain best margins while introducing new metrics for sustainability and sourcing low-cost alternatives.
Two-thirds of the survey respondents conceded that they anticipate price increases as the transition to sustainability gathers pace, but they also believe that the transition will deliver a competitive advantage.
Closer supplier relationships are set to play a key role in helping procurement professionals gain new visibility into the second tier of the supply chain and beyond – currently, only 50% of the industry has visibility beyond tier one.
The survey found that CPOs and their teams will be pushing for fair wages, employee wellbeing and ecological responsibility across the chain, placing a great emphasis on collaboration between companies to achieve this.