[TC]² Bi-Weekly Technology Communicator
The Trials and Tribulations of Sustainable Strategies
Do They Pay?
By Kim Anderson, [TC]²
Today, most apparel companies focus on their core operations and out-source non-core activities to manufacturers that provide services at the lowest possible cost. This practice has resulted in the globalization of supply chains where a number of decentralized and independent firms collaborate together as opposed to the traditional single, integrated organization. The focus of the current strategy is to provide good service at the lowest possible price. Until recently, little attention has been paid to how a company’s decisions and actions affect other factors, such as the environment and sustainability of natural resources. Companies are now finding themselves searching for answers to questions such as:
• Is there a relationship between sustainability and Corporate Social Responsibility (CSR) and long-term economic success?
• Do firms which engage in sustainable and CSR practices attain a higher economic performance than firms which concentrate solely on economic performance?
In 2004, about 68 percent of the Fortune Global 250 firms stated in their annual report that they were engaged with environmental, social and economic activities. Previously the primary emphasis was on environmental reporting only. In addition, 80 percent of these reports discuss supply chain-related issues.
However, with the recent economic downturn, many companies are questioning the value of sustainable and CSR strategies. According to a recent survey, 31% of respondents see their CSR budgets decreasing; another 26% say it's too early to determine the impact of the economic crisis on their CSR plans.
But companies are proving that sustainable and CSR strategies are smart business—and can reduce costs and boost efficiency. They are finding that a reduction in costs results in a more productive business which ultimately helps prepare them to successfully weather the gloomy global business market.
In 2006, Xerox saved $18 million by reducing greenhouse gases. Through sound energy management, new and innovative manufacturing technologies, more efficient heating and cooling equipment in their facilities and reducing the miles traveled by their service fleet, Xerox achieved an 18% reduction in greenhouse gas emissions since 2002 and hopes to reach a 25% decrease by 2012.
S.C. Johnson, a company that manufactures household cleaning products and products for home storage, air care, personal care, and pest control, implemented a transportation logistics project that saved them $1.6 million a year. Wal-Mart reduced costs by $1 million a year just by shutting off the lights in their vending machines.
Other success stories include Uptime Institute, an educational and consulting firm. They have saved more than $140 million over four years mostly by making existing data centers more efficient, rather than building new ones. It is also cutting its carbon dioxide emissions almost by half.
Dow Chemical consolidated printing devices from 16,000 to 5,000—saving paper and reducing its overall environmental impact. Dow estimates that it will save between 20% and 30% on printing costs annually.
And there is an additional rather inconspicuous benefit: Wall Street sees the value of these strategies. A recent Thomson Reuters (TRI) study found that 82% of investors evaluate environmental, social, and governance criteria as part of their investment decision because they believe these actions impact share price.
Supply chain professionals are in an excellent position to impact a company’s sustainable and CSR practices. Activities such as reducing packaging, improving working conditions, using more fuel efficient transportation and requiring suppliers to undertake environmental and social programs are just a few examples that can reduce costs while also improving the corporate reputation.
The profitability of any supply chain is dependent on the successful alignment of its decisions and strategies to the specific customer requirements it is set up to serve. Even with the economic downturn—the optimal use of scarce resources can result in long-term economic profits.
References
Craig R. Carter, University of Nevada, College of Business Administration, Reno, Nevada, USA. Dale S. Rogers, University of Nevada, College of Business Administration, Reno, Nevada, USA A framework of sustainable supply chain management: moving toward new theory, 2008.
Rajesh Piplani, Special Issue Editors, Nyoman Pujawan and Saibal Ray
Sustainable supply chain management. May 2007.
Ursula Burns, Is the Green Movement a Passing Fancy? Business Week Online
January, 2009.
Yuhan Kimberly Installs New MC3 Printer for Nano Colorant Printing
By Kerry King, [TC]²
In May of 2007, Yuhan Kimberly's MC2 digital print system was placed in [TC]²’s technology demonstration center. This system included the Ujet MC2 printer and nano colorant textile inks, a specially formulated pigment-based chemistry. Yuhan Kimberly recently updated this demonstration via the installation of its Ujet MC3 - Premium system. This Mutoh-based technology makes use of newer generation Epson printheads that support increased print speed.
The digital print team at [TC]² will be utilizing this system to continue the investigation of nano colorant printing and will be providing pigment based printing services. InkDrop Printing is currently accepting print projects on a case by case basis. Contact Lujuanna Pagan (919-653-3508) or Kerry King (919-653-3523) to learn more about this service or visit http://www.inkdropprinting.com/nanocolorant.htm to access information about [TC]²’s research into nanocolorants.
[TC]² gratefully acknowledges Yuhan Kimberly’s placement of the digital print system for research and demonstration.
[TC]² Activity
“COLOMBIATEX” de las Americas 2009
Medellin , Colombia
January 27 – 29, 2009
By Arturo Rodriguez, [TC]² Latin America Manager
Colombiatex is the oldest sewn product supply event in that part of the world and is proudly produced by INEXMODA. This year’s 21st edition was the first produced under their new executive director, Carlos Eduardo Botero. Botero and his talented crew of coworkers put on a good show in spite of adverse world economic conditions and a not yet approved FTA with the USA. In the show brochures, they estimated some potential 9,000 show visitors. In 9 pavilions spread over 40,000 square meters or 400, 000 square feet, the visitors saw 410 exhibitors, both domestic and from abroad (some of the countries represented - besides Colombia - were the US, Spain, Mexico, Ecuador, Guatemala, and Peru). From fiber to textile, accessories, textile and sewing machinery, finished product in a full package format including a well versed academic program, the show had it all…plus the incredible flavor of the Paisas.
What did the show accomplish besides gathering some 1,500 international buyers? Some estimates show that 33 million dollars worth of sales in sewn products were closed. And, if this was not enough, the projection is to close another 60 million dollars in sales over the next few months.
While the show ran for 3 days, I spent 6 days in Medellin. My time was divided between the show and promotion of SPESA Expo 2010, the major international trade show event for the sewn products industry in the Western Hemisphere, to be held May 18-20, 2010, at the Georgia World Congress Center in Atlanta. The last 2 days was spent on a special follow-up assignment at C.I. Expofaro. Expofaro is one of Medellin’s premier jeans operations and has been a long time client of [TC]². I reviewed the progress of their lean manufacturing modules and analyzed the steps taken to streamline their product development cycle based upon our BPA (Business Process Analysis) project. This follow-up will be documented in future issues of this bi-weekly newsletter.
And how did we promote SPESA EXPO 2010? Dave Gardner of SPESA and I met with company representatives from several countries of the region – Colombia, Guatemala, Peru, Ecuador, Brazil, USA and Mexico. [TC]² will be assisting SPESA with promotion of SPESA Expo 2010 in Latin America and the US.
What is the 2009 sewn products outlook for Colombia? First, some fast facts:
1) Exports to the US have been hurt by not having the final approval on the FTA, as well as by a drop in US demand for apparel during the start of 2009.
2) While apparel exports grew some 26% in the first 8 months of 2008 compared to the same period in 2007, exports have slowed in 2009.
3) Venezuela, Colombia’s primary export market, was slow during the later part of 2008 and continues to be in 2009.
4)
Colombia’s currency (the Peso) has appreciated to some 1,800 pesos to the dollar and has hurt exports. Now it is back down to approximately 2,500, which might trigger apparel exports.
5)
Some major Colombian apparel companies are looking to neighboring Peru for economical reasons in their manufacturing operations.
All the above noted, Colombia continues to be strong in design, disciplined hand labor and a strong textile base (more so since the 10% imported cotton fiber surcharge was eliminated at the end of January 2009). It is my belief that by end of 2009, Colombia will be in a position to resume its leadership in the apparel world of Latin America.
Sponsor Profile - Lawson
By Karen Davis, [TC]²
In 2006, Lawson Software and Intentia merged to form the new Lawson. The company delivers software and implementation services to 4,000 customer sites in manufacturing, distribution and services industries across 40 countries.
Its Financials, Human Capital Management, Customer Sales & Service, Supply Chain Management, Manufacturing, Business Intelligence, Asset Management, Product Lifecycle Management and industry-specific solutions help customers streamline processes and enhance their business performance. And, by radically simplifying the process of deploying and using its applications, Lawson helps customers reduce costs while increasing flexibility.
Lawson offers enterprise resource planning (ERP) and product lifecycle management software solutions that provide the competitive advantage and flexibility expected in best-practice business process automation. Its enterprise business software solutions are built and proven on the most advanced, open standard technologies.
The Lawson M3 Enterprise Management System provides a number of integrated business application suites that cover all core and supporting processes including financial management, customer relationship management, manufacturing, supply chain planning, supply chain execution, and service and maintenance.
Lawson Fashion PLM supports product design and development in apparel companies. Planning Workbench for Fashion supports manufacturers in the planning of production across multiple lines and sites. Assortment Replenishment Planner is a ‘single solution’ offering for a more effective, efficient and integrated store assortment and replenishment planning process.
Among its resources, Lawson employs Opportunity Analyzer™, a tool and methodology for M3 customers, designed with the key objective of aligning IT to corporate goals. Opportunity Analyzer™ integrates real financial figures and process improvement ideas to create key performance indicators that will drive a company’s business.
Regional learning centers offer the latest training courses in the appropriate language in many locations throughout the world. For more details on learning opportunities and other Lawson services, visit www.lawson.com.
[TC]² gratefully acknowledges Lawson’s Gold sponsorship of the Next Steps in Fast Fashion event at FIT on January 14.
Important Dates
March
11-13 |
AAFA Executive Summit - Hyatt Coconut Point, Bonita Springs, FL. For details, visit www.apparelandfootwear.org. |
12 |
Lean Strategies for Product Development, seminar at [TC]² . For details, click here. |
23-27 |
Introduction to Apparel Manufacturing, seminar at [TC]² . For details, click here. |
24 |
Apparel Tech West Conference, Fashion Design and Merchandising, Irvine, CA. For information or to register, go to www.apparelmag.com. |
For detailed information about industry events, visit www.techexchange.com
Thanks to the techexchange site sponsors
Apparel Magazine, Gerber Technology, Lawson, Lectra, Methods Workshop and Reach Technologies.
A Look Ahead in the Newsletter
PeruModa
View previous editions of this newsletter
[TC]²
5651 Dillard Drive
Cary , NC 27518
www.tc2.com
Phone: 919-380-2156
Fax: 919-380-2181
Email our editor:
If you are not on our mailing list and wish to receive this bi-weekly newsletter, via email:
To subscribe to the newsfeed, copy and paste the following URL into your newsreader:
http://www.tc2.com/newsletter/newsfeed.xml
If you would prefer not to receive this free bi-weekly newsletter, and wish to be removed from our mailing list:
