Fair Purchasing Practices and Barriers in EU SME Garment Supply Chains
Brussels, 11 May – After our report documenting unfair trading practices in the European apparel industry, we release today a second, complementary report that looks at fair and responsible purchasing practices put in place by European fashion SMEs, and their barriers in remaining competitive in the current fast fashion industry.
The report is based on research work – including interviews, surveys and comparative desk analysis – conducted by researchers from the University of Portsmouth. The result is a review of unfair trading practices (UTPs) in textile supply chains, and a case study analysis of emerging best practices in terms of companies that are implementing fair and responsible purchasing practices across a range of areas including: lead times, payment details, prices, discounts, technical specifications, volumes and stock management.
Despite significant market challenges, especially the fierce competition by big conventional fast fashion brands, many sustainable SMEs (brands and suppliers) are innovating with purchasing practices that begin to shift power dynamics within fashion value chains. The report shows that, if supported, these companies have the potential to be industry front-runners and demonstrate fair purchasing practices that can be replicated and scaled across the whole garment sector.
The report closes by giving concrete proposals to address power imbalances in garment value chains:
- Public policy support to help level the playing field for SMEs and social enterprises. Big brands need to be held accountable for unfair purchasing practices in order to allow others to compete. Researchers point to the need to develop a regulatory approach to UTPs in textile at European level, for instance with a EU Directive.
- Business associations and support for SMEs, as these have a crucial role in building alliances and coalitions that can connect positive dimensions, and shifting away from the current norm that associations representing the garment and apparel sector are frequently dominated by the interests of big businesses.
- Supply chain transparency, including with the creation of publicly available factory lists accessible also to workers and unions for wider communication and action.
- Worker-driven social responsibility instead of Corporate Social Responsibility (CSR): human rights protection in corporate supply chains must be worker-driven, enforcement-focused, and based on legally binding commitments that assign responsibility for improving working conditions to the global corporations at the top of the supply chain.
For any inquiries, please contact May Hylander at hylander@fairtrade-advocacy.org.
Read the full report here.