In an increasingly competitive and volatile market, strategic sourcing ensures brands and businesses can more effectively manage costs and risks and build better relationships within their supply chain.
According to Gaynor Scott, Director at Retail Sourcing Consultants and ESG Sourcing Specialist, strategic sourcing is what every company should consider as their opportunity to balance ESG and commercial outcomes. “It involves moving from opportunistic (short-sighted, reactionary) decisions to considered and strategic decisions. Ultimately the aim is developing a graded, transparent supply chain that is capable of delivering on the strategic plans of your brand, balancing both ESG and commercial success”.
Retail Sourcing Consultants are a consultancy that works with organisations in the fashion, retail, and textile industries to drive best in class sourcing practices.
Having worked alongside brands to help them align to these principles, Gaynor has become a respected specialist.
Her upcoming seminar, at the Global Sourcing Expo Melbourne (taking place from 21-23 November) in Melbourne, Moving from Opportunistic to Strategic Sourcing – Unlocking ESG Opportunity’, will guide Expo guests through the transition, providing them with the know-how to successfully and responsibly source from different regions.
Making the transition from opportunistic sourcing to a more strategic approach
Brands looking to make the switch to strategic sourcing may find the process daunting, but Gaynor encourages them to take a practical approach.
This starts with a clear understanding of the long-term business strategy and vision, and an assessment of the risks, as well as a range of other criteria including commercial, product-specific skills, social and environmental.
“To begin, it’s crucial to develop a comprehensive understanding of your suppliers and, most importantly, their factories, from both a commercial and a social/environmental perspective. It’s important to note that suppliers may not necessarily own the factories where your products are made. Therefore, grasping how, where, and by whom your products are manufactured is as vital as managing the sales and marketing relationship you typically have with your suppliers. Seeking technical support on this matter can significantly enhance your understanding, awareness and ultimately your results,” says Gaynor.
While it may seem convenient to bring in new suppliers as a quick solution, the primary focus should be on comprehending your existing suppliers and their factories. Before exploring new countries, suppliers, and factories, it’s essential to conduct a thorough exit analysis and gap assessment.
Honing best practices
A key step in refining a strategic sourcing approach is evaluating suppliers’ ESG performance and ensuring transparency in the supply chain. “Ensuring sound governance is a critical first step when evaluating suppliers – this involves developing a set of criteria that is aligned with international and local laws; you can then build on this based on your strategic objectives,” says Gaynor.
The good news is that robust legislation and technology are driving opportunities for defining, evaluating, and monitoring the performance of a supplier’s governance, environmental and social impact performance.
Addressing common sourcing hurdles
The hunt for more sustainable fibres and materials isn’t always smooth sailing, with many organisations left frustrated by the challenges of navigating a fragile and fragmented supply chain. “This has a range of implications including resource inefficiencies, thanks to the current lack of structure and resources to support traceability goals,” says Gaynor.
To avoid these frustrations, it’s critical to address responsible sourcing at the very early stages of engagement with new suppliers – even going as far as writing it into the onboarding criteria. “In general, a good starting point is to request current audit documentation and industry certifications relating to social or environmental standards. Subsequently, you can delve further into specific criteria aligned with your organisation’s requirements. It’s also not uncommon to discover that the factory has its own strategies, targets, and accomplishments,” Gaynor suggests.
Partner with the pros at Global Sourcing Expo Melbourne
She also encourages businesses to partner with a specialist who can help them achieve best results. Retail Sourcing Consultants, for example, works closely with a business’s C-Suite to embed social and environmental impact strategy and sound governance into the overall business strategy. After this becomes an integral part of the company’s identity and values, they collaborate with relevant departments to enhance their understanding of supplier and factory relationships. This knowledge enables them to assist customers in mitigating risks, capitalising on commercial opportunities, and achieving ESG and impact goals.
“We are thrilled to have Gaynor and Retail Sourcing Consultants as a speaker at the Global Sourcing Seminar Series at our Melbourne show. Attendees will leave the seminar with clear and practical guidelines, enabling them to make the transition towards strategic sourcing. This is critical to the long-term sustainability and success of the fashion industry,” concludes Marie Kinsella, CEO of the International Exhibition & Conference Group, organisers of the Global Sourcing Expo.
The ‘Moving from Opportunistic to Strategic Sourcing – Unlocking ESG Opportunities’ Seminar takes place on 23 November from 1:00 to 2:00pm at the Melbourne Convention & Exhibition Centre. Tickets cost $40 +gst and can be purchased online: https://globalsourcingexpo.com.au/visitor/seminars/
The Seminar Series forms part of the larger Global Sourcing Expo Melbourne which will see 900 manufacturers and suppliers from over 20 countries showcasing their products