As the EcoVadis SUSTAIN Summit in Paris came to a close this week, one message emerged clearly from conversations across the conference, the award submissions, and the jury deliberations.
Sustainable operations are no longer optional — they are a strategic imperative for navigating an increasingly volatile and uncertain world.
Serving as a juror for the Sustainable Procurement Leadership Awards for the fifth year has provided a vantage point few people have: reviewing sustainability programs from companies across industries and geographies and seeing firsthand how global organizations are evolving their operating models.
This year, one shift became unmistakably clear.
The future of sustainability leadership will not be defined by commitments.
It will be defined by resilience.
For more than a decade, sustainability leadership was measured by ambitious targets and public commitments. While those milestones helped accelerate progress, the operating environment facing companies today has fundamentally changed.
Global supply chains are navigating an era defined by geopolitical reshuffling, climate disruption, regulatory pressure, technological acceleration, and rising expectations around human rights and transparency.
Consider just a few signals shaping this new reality:
80% of CEOs are actively redesigning their supply chains in response to geopolitical and economic shifts (PwC CEO Survey).
Climate-related disruptions could cost companies more than $120 billion annually by 2030 if risks remain unaddressed (CDP).
Yet only 4% of CEOs currently include nature-related risks in their core business discussions (World Economic Forum).
In this environment, leadership is no longer about declaring goals.
It is about building systems capable of operating through uncertainty.
Defining Resilience
Resilience has quickly become the new language of sustainability, but it is often used without a clear definition.
In the context of global supply chains, resilience means the ability to:
anticipate risk → mitigate exposure → adapt to disruption → respond intelligently in real time.
This requires a combination of strong supplier partnerships, operational discipline, and emerging technologies — all guided by human judgment where it matters most.
Resilience is not simply about preventing disruption.
It is about building organizations capable of navigating disruption while continuing to create value.
In other words, sustainability is evolving from a set of commitments into an operating model for managing risk, strengthening partnerships, and enabling long-term growth.
What the Jury Looked For
The Sustainable Procurement Leadership Awards bring together an international jury of experts to evaluate programs from companies around the world.
This year’s jury included Laura Taal-Groeneveld, Elsa Savourey, and Divya Kapasi Demato, CEO of GoodOps.
Across submissions spanning multiple industries and geographies, several themes consistently emerged among the strongest programs.
Leading companies are focusing their efforts in three critical areas:
Human Rights
Programs that move beyond compliance to address living wages, worker voice, and supplier capability building are emerging as powerful drivers of resilience.
Human rights is increasingly becoming an area of competitive advantage, as companies recognize that resilient supply chains depend on empowered and stable workforces.
Net-Zero Transformation
Decarbonization strategies are increasingly integrated directly into procurement decisions and supplier engagement models, reflecting the reality that the majority of corporate emissions sit within supply chains.
Regenerative Supply Chains
Organizations are beginning to rethink supply chains not simply as extractive systems, but as ecosystems capable of restoring natural capital and strengthening long-term resource security.
But what ultimately distinguished the strongest submissions was not the ambition of their commitments.
It was the evidence of action.
The companies that stood out were those demonstrating real operational progress — embedding sustainability directly into supplier relationships, governance systems, and business strategy.
Recognizing This Year’s Leaders
Two companies stood out this year for demonstrating how sustainability leadership translates into operational resilience.
Schneider Electric, recognized in the Mature Program category, illustrated the power of sustained commitment over time. Their work demonstrates how responsible procurement, when embedded into the fabric of an organization, can produce measurable results and long-term impact.
The Emerging Program winner, Siegwerk Druckfarben, impressed the jury with the speed and seriousness of their journey from vision to execution. Sustainability practices have already been embedded across their supply chain, supported by a strong culture of transparency and continuous improvement.
What particularly distinguished both organizations was their focus on human rights as a strategic priority.
From advancing living wage initiatives to strengthening worker voice and investing in supplier training and workshops, these companies are demonstrating that social impact is not separate from business performance — it is a foundation for long-term resilience.
Peeling Back the Curtain
Following the awards, Divya Kapasi Demato moderated a deep dive session with the winners titled:
“Peeling Back the Curtain: Inside the Leadership Playbook for Sustainable Procurement.”
What made the conversation particularly valuable was its honesty.
There were no buzzwords or polished talking points.
Instead, the discussion revealed the real decisions, trade-offs, and long-term strategies behind award-winning programs.
Several lessons emerged.
The Big Pivot
Many of the most important strategic decisions companies made were not framed as bold risks.
They were framed as common-sense business strategy.
Sustainability was integrated directly into operational decision-making rather than treated as a parallel initiative.
Suppliers as Partners
The strongest programs treat suppliers as partners in innovation and capability building.
Rather than imposing compliance requirements alone, these companies collaborate closely with suppliers — recognizing varying maturity levels and building phased roadmaps for progress.
The goal is not to penalize suppliers, but to bring them along on the journey.
Human Rights and Real Impact
Traditional audit models often fail to detect deeper systemic issues within supply chains.
Leading companies are therefore combining audit frameworks with long-term supplier partnerships that allow challenges to be addressed collaboratively when they arise.
This approach enables organizations to address root causes rather than simply shifting risk elsewhere.
A Broader Shift in Supply Chain Leadership
One of the most powerful moments during the conference came from reflections shared by Paul Polman, former CEO of Unilever.
He emphasized that procurement and supply chain leaders have a unique opportunity to shape the future of global business.
For decades, procurement has largely been defined by cost efficiency and operational execution.
Today, it sits at the center of nearly every major global challenge — from geopolitical realignment and climate disruption to technological transformation and regulatory change.
Procurement leaders understand complex systems.
They maintain deep relationships with suppliers.
And they often see emerging risks before they materialize.
Which means they are uniquely positioned to drive innovation and transformation across global value chains.
The question now is simple:
Who is willing to step up and lead?
Technology and the Rise of the Autonomous Supply Chain
Another theme that surfaced repeatedly during SUSTAIN was the growing role of technology in enabling resilient supply chains.
Speakers from organizations including EcoVadis and Accenture described a future in which supply chains become increasingly autonomous, agentic, and augmented.
In this vision, companies will be able to continuously detect risk, predict disruptions, and resolve issues in real time — creating what many are beginning to call “self-healing supply chains.”
But technology alone is not the answer.
Resilient supply chains will require organizations to:
automate what should be automated
maintain human judgment for critical decisions
make trade-offs explicit at the moment decisions are made
redefine supplier relationships from compliance to co-creation
Ultimately, technology will scale the logic we give it.
Which means the systems we build must reflect a broader understanding of stakeholders — including the planet and future generations.
Imagining the Future
One idea echoed across multiple conversations at SUSTAIN.
If we want to build a different future, we must first be willing to imagine it.
Vision often comes before spreadsheets.
It requires leaders who are willing to think differently about how systems can work — and who are prepared to act even in the face of uncertainty.
Because leadership, ultimately, is defined by the willingness to move forward before all the answers are known.
Gratitude
Thank you to EcoVadis for convening this global community and for continuing to elevate the companies turning ambition into action.
Congratulations again to Schneider Electric and Siegwerk Druckfarben for demonstrating what leadership in sustainable procurement looks like in practice.
And thank you to the fellow jurors, speakers, and participants whose insights continue pushing this work forward.
The progress is real, and the work ahead is more important than ever.
🇫🇷 GoodOps in Paris: 5 Years on the Jury at EcoVadis SUSTAIN
This week, GoodOps is in Paris as our CEO, Divya Kapasi Demato, serves for the fifth consecutive year as a Jury Member for the Sustainable Procurement Leadership Awards at EcoVadis SUSTAIN.
Across five years of evaluating submissions spanning food and agriculture, apparel, consumer goods, manufacturing, and technology, one reality is clear:
Sustainable procurement is no longer differentiated by ambition alone. It is differentiated by execution, integration, and measurable impact.
The sophistication of programs continues to rise — as does the complexity of the global operating environment.
Below are four insights shaping what leadership looks like in 2026 — and how GoodOps is helping clients stay ahead.
1️⃣ Complexity Is the New Baseline
Procurement leaders are navigating:
Persistent tariff and geopolitical volatility
Expanding regulatory requirements across Europe and California
Heightened anti-greenwashing enforcement
Ongoing Scope 3 data fragmentation
The organizations standing out are not reacting piecemeal. They are building integrated operating systems that align risk, compliance, climate, and commercial strategy into one cohesive framework.
Procurement is no longer a support function — it is a central pillar of enterprise resilience.
At GoodOps, we work with executive teams to embed sustainability and risk management into core procurement architecture, ensuring long-term competitiveness in a shifting regulatory and geopolitical landscape.
2️⃣ Innovative Technology Is the Strategic Lever
The strongest submissions this year demonstrate that innovative technology is deeply embedded into procurement decision-making.
Leading organizations are:
Mapping multi-tier supply chains with greater precision
Using advanced analytics and AI selectively to identify emerging risks
Prioritizing interventions based on real performance data
Converting compliance requirements into forward-looking strategy
The competitive edge is not in collecting more data — it is in activating the right data.
Technology, when paired with governance and cross-functional alignment, becomes a lever for resilience, cost efficiency, and smarter capital allocation.
3️⃣ Human Rights Is a Competitive Advantage
One of the most significant evolutions over the past five years is the elevation of human rights from compliance obligation to strategic priority.
The most advanced organizations are:
Moving beyond audits toward supplier capability-building and worker engagement
Embedding human rights risk assessments into sourcing decisions
Aligning due diligence with commercial incentives
Measuring real-world outcomes — not just policy adoption
In a world of mandatory due diligence, heightened consumer scrutiny, and investor pressure, companies that proactively integrate human rights into procurement gain measurable advantages:
Reduced disruption and legal exposure
Stronger, more stable supplier relationships
Increased brand trust
Long-term operational resilience
The leaders recognized this year show that investing beyond minimum compliance drives both impact and enterprise value.
For GoodOps, human rights is not a side pillar of ESG — it is integral to building durable, high-performing value chains.
4️⃣ Partnerships Define Performance
Award-winning programs consistently reflect a shift from transactional oversight to strategic collaboration.
They are:
Investing in supplier capability and long-term alignment
Co-developing decarbonization and resilience roadmaps
Participating in pre-competitive industry collaboration
Treating suppliers as innovation partners, not risk checkpoints
When procurement, sustainability, and finance align around shared objectives, supplier ecosystems become engines of competitive advantage.
Five Years of Perspective
Serving on the EcoVadis SUSTAIN jury provides a rare longitudinal view into how global enterprises are evolving.
The companies that consistently rise to the top:
Embed sustainability and human rights into procurement KPIs
Align CPO, CSO, and CFO agendas
Use technology to enhance clarity — not complexity
Treat resilience as core business strategy
Sustainable procurement is no longer a niche excellence category. It is an indicator of enterprise maturity and future readiness.
As complexity intensifies, the organizations that will lead are those building intelligent, resilient, and rights-respecting value chains — grounded in data, strengthened by partnerships, and designed for long-term performance.
GoodOps is proud to contribute to this global ecosystem and to continue shaping the future of resilient supply chains alongside the leaders redefining what procurement can achieve.
GoodOps’ “Transforming Supply Chains with Cleantech and Innovation” panel during SF Climate Week explored the strategic imperative for adopting the “Supply Chain Climate Stack” in enterprise operations. Companies powered by these technologies will be the most successful in building long term resilience, improving risk mitigation, increasing productivity, and reducing costs in an uncertain future. Our CEO & Founder panel from Mango Materials, Skyven Technologies, Artyc, and GlacierGrid illustrate the future we need to build:
SOURCING | Mango Materials | Molly Morse, CEO & Founder
Mango Materials transforms methane emissions, a potent greenhouse gas, into biodegradable polymers. By disrupting the conventional plastic supply chain, Mango Materials not only mitigates environmental harm but also fosters resilience by diversifying feedstock sources. Their innovative approach underscores the importance of sustainable sourcing in building a robust supply chain foundation.
MANUFACTURING | Skyven Technologies | Arun Gupta, CEO & Founder
Skyven Technologies, who just received $145M from the DOE, contributes to another layer of the Supply Chain Climate Stack by offering solar-powered solutions for industrial heating. By harnessing renewable energy, Skyven reduces reliance on fossil fuels, enhancing manufacturing sustainability and resilience. Their integration into the supply chain climate stack demonstrates how manufacturing can align with environmental goals to mitigate climate risks.
LOGISTICS | Artyc | Hannah Sieber, CEO & Co-Founder
Artyc plays a pivotal role in the Supply Chain Climate Stack by optimizing cold chain logistics with AI-driven temperature monitoring and control. By minimizing temperature excursions and food waste, Artyc enhances supply chain resilience while mitigating climate-related risks. Their solution underscores the importance of climate-conscious logistics in safeguarding perishable goods and ensuring supply chain continuity.
SITE OPERATIONS | GlacierGrid | Manik Suri, CEO & Founder
GlacierGrid ascends the top layer of the Supply Chain Climate Stack by optimizing data center cooling with thermal energy storage technology. By reducing energy consumption and enhancing resilience to climate events, GlacierGrid strengthens the sustainability of site operations. Their contribution highlights the critical role of sustainable infrastructure in building climate-resilient supply chains.
The Supply Chain Climate Stack – A Business Imperative
As companies confront the uncertainties of a changing climate, embracing the Supply Chain Climate Stack is imperative for building resilience and risk mitigation. Startups like Mango Materials, Skyven Technologies, Artyc, and GlacierGrid exemplify the integration of sustainability into each layer of the supply chain. By adopting innovative solutions and collaborating across industries, businesses can navigate climate challenges while driving environmental progress. As we ascend the Supply Chain Climate Stack, let us forge a path towards a future where sustainability and resilience are synonymous with business success.
GoodOps kicked off SF Climate Week with our Supply Chain Salon for Climate Action. Over wine tasting and fire pits, leading climate investors, founders, and corporate leaders explored decarbonization, waste reduction, and AI in the supply chain.
Participants included leaders at the forefront of climate, including Apple, Tesla, Flexport, Amazon, Mainspring Energy, Planet FWD, Mill, Dell, Salesforce, UN Global Compact, Google, Cathay, Nissan, EcoVadis, Telo Trucks, Toshiba, Skyven, GlacierGrid, and more.
The passion, enthusiasm, and promise for solutions in this space is mounting and we are thrilled to be at the center of it.
GoodOps‘ all-star startup panel at SF Climate Week delivered an insightful roadmap for transitioning supply chains into climate-responsible operations. We explored cutting-edge advancements, including next-gen materials derived from methane gas, the adoption of Energy as a Service (EaaS) in industrial manufacturing, innovations in temperature-controlled cold chain logistics, and the integration of AI-driven site operations.
Additionally, we underscored the importance of considering the entire supply chain climate stack, from solutions’ origins through to end customers, to ensure comprehensive environmental accountability. The possibilities for investment, development, and collaboration in this space are boundless, and we are thrilled to be at the forefront of driving this critical conversation.
Our esteemed panel of CEOs & Founders are the visionaries shaping the new paradigm for how the world sources, manufactures, transports, and operates its goods.
Thank you also to our moderator Dasha Shunina from Women Tech Meetup for helping to guide our conversation. And, to Werqwise who graciously hosted our event in San Francisco.
Ecovadis: The Sustainable Value Chains Podcast series features senior sustainability experts and executives who explore a wide range of environmental, labor and human rights, ethics, and sustainable procurement issues and looks at how companies can develop more sustainable value chains.
In this episode of the Sustainable Value Chains Podcast, Divya Demato, CEO and co-founder of of GoodOps outlines a clear perspective on what sustainable leadership means today – and how it has changed since the pandemic.
Sustainability Leadership Today: Going Beyond the Basics
In our rapidly changing world definitions and expectations are also subject to major shifts. Gone are the days when merely announcing a commitment to reducing water usage or ensuring fair wages made a company a leader in sustainability. Today, true sustainability leadership demands more. It’s about embedding environmental and social initiatives deeply within the core business, moving beyond CSR to integrate these values across the entire value chain.
So, how exactly has sustainability leadership changed over the past few years? Divya explains that before the pandemic we saw a deluge of corporate sustainability reports, but the post-pandemic world demands these environmental and social commitments be deeply woven into the business fabric, going beyond mere Corporate Social Responsibility (CSR). As a result, companies that were once at the forefront, those who made early commitments to reduce water use, pledge net zero, or ensure fair wages, now blend into the mainstream. Today’s sustainability leaders are reimagining business strategies. This includes innovations in product packaging, responsible raw material sourcing, transitioning to renewable energy, and committing to policies that protect society’s most vulnerable. The cornerstone? Building trusted supplier relationships. The shift is not just about ticking boxes for the upcoming 2030 and 2050 milestones; it’s about establishing businesses that can thrive amidst rapidly changing global conditions.
Divya further categorizes leadership tiers in sustainability. The first involves those companies that quickly adapt to new sustainable technologies and practices. The second, the “leaders of leaders,” invest in novel solutions, sometimes in collaboration with competitors. The third are pioneers, those who challenge and shift industry paradigms. Examples include Unilever’s living wage commitment and Patagonia’s unwavering environmental pledge. However, the current urgency around sustainability isn’t just driven by foresight; for many industries, it’s about immediate survival. With predictions like the potential depletion of seafood by 2048, some sectors face existential threats. The path forward requires not just innovation, but also deep introspection about the legacies companies wish to leave behind.
The Role of C-Suite in Sustainability
For successful sustainability initiatives, a top-down approach is paramount. While sustainability teams lay the groundwork by identifying environmental and societal challenges, real momentum is generated when the C-suite, especially CEOs and CFOs, offer their support. This leadership involvement ensures sustainability permeates throughout every facet of the organization – from product design and innovation to procurement and energy infrastructure. CEOs, in particular, play a critical role. Their foresight into future challenges allows the company to pivot, innovate, and remain relevant in an ever-changing landscape. This isn’t solely about addressing current consumer needs or navigating impending regulations; it’s about ensuring a viable business future in the face of existential threats such as climate change or resource scarcity.
Challenges in Transitioning to Sustainability and Sustainable Value Chains
Leadership in sustainability isn’t without challenges, however. Some initiatives, like promoting living wages, might not always translate to immediate profits. Yet, even if a company isn’t leading the charge, inaction isn’t an option. Every business, due to its reliance on natural resources, faces potential disruptions. To navigate these disruptions, firms need to be proactive about sustainable sourcing and adopt regenerative practices. But one of the biggest mistakes companies make is viewing sustainability only as a marketing or CALMS exercise. This perspective often leads them to grapple with whether their supply chain practices truly warrant the sustainable labels they claim. Strategically, businesses should evaluate their sustainability claims and align them with genuine practices. Financially, these initiatives demand significant investments, especially in areas like R&D. Adopting sustainable practices could involve using biodegradable packaging, transitioning to regenerative agriculture, or ensuring fair wages for workers. Successful sustainability transition requires cross-departmental collaboration, involving heads of procurement, logistics, marketing, and finance, to ensure a coherent and integrated approach.
Tools like materiality assessments can guide businesses in prioritizing their sustainability efforts, pinpointing high-risk areas that might impact both consumers and the larger world. Such evaluations can forecast potential challenges, as demonstrated during the pandemic, and aid in future-proofing business strategies. While prioritizing is vital, it’s equally crucial not to overlook any sustainability aspect, as lesser concerns can swiftly become significant risks. On the communication front, if a company has a genuine sustainability story, marketing becomes straightforward. Yet, issues arise when businesses prioritize branding before actual sustainable actions. With the supply chain’s increasing visibility, especially during crises like the pandemic, consumers now seek transparency and authenticity in sustainability stories, underscoring the need for marketing and operations to work collaboratively.
Divya stresses, however, that sustainability efforts are about progress, not perfection. The key is transparency about where a company stands in its sustainability journey.
Best Practices for Sustainability Leadership
Leaders in sustainability aren’t merely setting long-term goals; they’re taking transformative steps toward tangible impacts. The most proactive businesses have their sights on 2030 and 2050 emissions targets, considering their Scope 1, 2, and 3 impacts. Since roughly 80% of a company’s emissions often fall within Scope 3, there’s an emphasis on reimagining the business model. This involves genuinely investing in their suppliers, helping them modernize with tools like solar panels and other renewables. These leaders recognize that without adequate support for frontline workers, achieving sustainability is a pipedream. Successful strategies prioritize efficient operations and community programs, like migrant education and improving the health conditions of workers, acknowledging that protecting these communities ensures long-term business viability.
It’s also noteworthy the role of procurement has emerged as pivotal. The Chief Procurement Officer (CPO) should ideally sit alongside other C-suite executives, bridging the gap between suppliers and business objectives. This redefined role sees procurement not just as a cost-saving function but as an innovative hub that balances affordability with sustainability. In the past, the procurement department often operated in the shadows, but as businesses realize its central role in driving sustainable solutions, it’s gaining the respect and voice it deserves. The new-age procurement team returns to the drawing board with solutions and options, working closely with suppliers to highlight new sustainable methods unknown to upstream departments, positioning them as central figures in the journey towards a more sustainable future.
Lastly, Divya reaffirmed that while sustainability is not just about communication, the narrative becomes more straightforward when businesses have a genuine story to share. If companies work towards sustainability in their supply chains and value chains, their marketing narrative will naturally resonate with consumers.
As the fashion industry continues to grapple with the far-reaching impacts of the pandemic and new global challenges, it has become clear that the ability to swiftly respond to changes in the supply chain is a defining factor for companies to achieve success. Industry stakeholders from ultra-fast fashion player Shein, sustainability strategy and operations consultancy GoodOps and management consulting firm Boston Consulting Group (BCG) discussed the challenges and opportunities of an agile supply chain in the recent webinar “Agile Supply Chain and the Future of the Fashion Industry”.
When are supply chains agile?
In the fashion industry, supply chains are considered agile when they can move products from the design phase to retailer shelves in two to eight months (or less), replenish inventory in season based on demand, and keep end-of-season remainders to a minimum. Some of the key challenges are cost management, end-to-end collaboration and quality control.
“In other words, companies with supply chain agility are able to respond quickly to short-term changes in demand by building a customer-oriented, end-to-end product-supply mechanism. This requires close collaboration and the quick coordination of merchandising, design, production, and channel needs,” states the BCG report “Agility Is Fashion’s New Source of Competitive Advantage”.
Challenge 1: changing customer behaviour
Veronique Yang, managing director and senior partner at Boston Consulting Group started the discussion by explaining how customers’ behaviour has changed: “They are expecting more diverse and ample products that come to them faster through faster deliveries and with free returns and exchanges. All the while expecting quality and a competitive price, which adds pressure on brands.” That is the customer-driven business model and according to Yang, ultra-fast fashion exists because of that need of consumers.
“It’s a tall order and we’re trying to meet it,” agreed Shein’s executive vice chairman Donald Tang. “Nobody has the answer of what the new normal is but consumers have become quite demanding and the battle has intensified and moved online,” he added. That is the battle for their attention, business and best deals: While inflation and economic uncertainties have pushed prices up, consumers are looking for ever more affordable prices. Tang stated that a survey among 25 percent of Shein’s customers revealed that while 13 percent are looking for more responsible choices in the current scenario, 87 percent have changed to more affordable brands.
“Those changes were happening already before the pandemic but the pandemic accelerated it,” explained GoodOps’s CEO and co-founder Divya Demato. “While there is no denying of the climate crisis and different industries having a role in that, companies are often at odds with that reality and consumers are at different levels of understanding this; they align themselves to brands according to that.”
Challenge 2: linear business models
For her, a linear business model does not work any more, especially in fashion. “The pandemic caught many off guard; the ones that managed had close relationships with their suppliers but there were still a lot of unknowns,” she said. “Brands are challenged with inventory management. They need to identify a supply chain eco system and build resilience,” she advised.
“Everybody would like to satisfy responsible consumer choices,” said Tang. A transformation that worked for Shein was to digitise small and medium size factories. “A few years ago in China, you saw small factories disappear. We digitised everything and connected small factories so that together, they could become one big company and compete,” recounted Tang. “This has increased their visibility, they can now see their own capacity and we can pay them fast, which leads to better liquidity.”
Opportunity 1: digitisation and transparency
For the Shein executive, sustainability comes back to technology and the platform. “We have to use technology for the planet and to improve working conditions,” he said. In this respect, Tang sees Shein as an “empowerment company”.
For Yang, it is not only technology that has made a difference: “Companies have realised that a supply chain can be really valuable and they started checking how it can be more stable while holding on to quality and competitive prices.”
For her, there have been three major changes: globally, the emergence of redesigned supply chain networks and even models; more openness and transparency across the supply chain, which includes new technology and digitisation; and finally, a high awareness of sustainability. All this, according to her, leads to resilience, responsiveness and responsibility, which is all very important as Demato pointed out “more is coming as the pandemic showed”.
Opportunity 2: on-demand
In terms of the tools to make all of this happen, Yang who manages different kinds of product categories, admitted that the fashion supply chain is the longest and most complex. “It involves many internal and external stakeholders and is quite fragmented,” she said. It requires the coordination of a large group of parties of different complexities, sophistication levels and digitisation levels and managing all that is challenging, which is why the complexity of the fashion supply chain can be a bit overwhelming. “Everybody needs to learn from the best but carefully select what fits their own business model,” she advised.
“Agility is the new source of competitive advantage, even before the pandemic,” emphasised Tang. Through its on-demand model – which Tang calls ‘a game-changer’, Shein also makes sure there is no waste, manages its inventory well and focuses on consumers’ needs, which for him is crucial for growth. “We want to be more inclusive; colour of skin, location, orientation, etc. does not matter but you have to reimagine the supply chain. At the end of the day, the consumer wins and you have to find a way to do go good while you’re doing well and do well while you’re doing good,” he summarised.
Demato agreed and compared Shein’s on-demand model for retail to how Walmart revolutionised prices through its wholesale model and how Amazon revolutionised e-commerce. “There could be less wast upstream but what about downstream? What can technology do? Consumers are still going to buy.” For her, it will be about more sustainable materials and innovations in textile recycling as only one percent of garments are recycled today because the technology is not there yet.
Opportunity and challenge: sustainability
“The infrastructure is there and many elements are in place but from a circularity perspective, we have to think of the whole life cycle. Consumers will ask ‘is it worth it to buy this? Or will this go to landfill?’. This is an opportunity for brands to get ahead of that,” Demato said.
“This moment has probably come already,” chimed in Tang, adding that “we have to figure out the preferred materials.” He also pointed out that “so far, we are only getting the half life here, not the full life cycle”. For him, it all comes down to cooperation: “Nobody is going to be big enough to sustain it and figure out the end-of-lifetime approach on their own.”
Yang agreed that industry players have to come together and use their power, scale and know-how collectively. “Fashion is a discretionary category that has a social and environmental impact. The supply chain needs to be of service to build a future of fashion and consumers. Technology helps us to reduce products, maximise resources and select more eco-friendly choices when it comes to dyeing, washing and other processes,” she concluded.
As the fashion industry continues to grapple with the far-reaching impacts of the pandemic, it has become clear that the ability to swiftly respond to changes in the supply chain is a defining factor in achieving success.
On 6 June, 2023, SHEIN hosted a webinar that discussed how digitalization and agile supply chain models are helping fashion industry players gain a competitive edge in today’s market.
Panelists:
Donald Tang, Executive Vice Chairman, SHEIN
Divya Demato, CEO & Co-founder, GoodOps
Veronique Yang, Managing Director and Senior Partner, BCG
As the world recovers from the standstill that was the pandemic, the customer purchase decision process has changed, as have the products being prioritized. Customers are demanding greater product variety, including more responsible options and faster product fulfillment to feed their desire for almost instant gratification. Veronique Yang, Managing Director and Senior Partner, BCG, said consumers are demanding more inclusive products with speedier delivery. She added that the growth of ecommerce channels during the pandemic has also driven customer demand for speedier delivery times – while holding expectations on quality and price.
“Consumers are becoming quite demanding and less forgiving, and the battle for those hearts and minds has intensified. And the battle has moved online,” added Donald Tang, Executive Vice Chairman from SHEIN. He further referenced results of a recent survey of over 2,500 SHEIN customers, where 87% reported shifting to more affordable fashion choices as a result of inflationary pressures.
With increasing global economic pressures, there has been a notable shift in supply chains, with companies increasingly having to adapt their models to survive. Said Divya Demato, Co-Founder and CEO of GoodOps, “These changes were happening before the pandemic, but the pandemic exacerbated it.” This was echoed by Donald Tang, who shared SHEIN’s business model of on-demand production. Veronique Yang further explained that companies are rethinking their global supply chain network – diversifying their supply bases “and sometimes even changing their supply chain models to prevent disruption.”
This drove the conversation towards the topic of resilience, which all speakers agreed was fundamental for the advancement of the fashion industry. While Donald Tang further shared how SHEIN had made it its mission to empower the supply chain since the start of SHEIN’s business, whether it was by funding their adoption of new tools and technology, or providing training and up-skilling to their workers, or even offering flexible settlement terms that are much shorter than the 90-days standard of the industry. Veronique Yang also added that resilience required creating more openness and transparency across the entire value chain – from suppliers to retailers. “They have to work together to problem solve the potential frictions… and digitization is a big part of that.”
Speaking to the recent report, Creating Agile Supply Chains in the Fashion Industry | BCG, Veronique Yang shared key learnings from BCG’s research:
Digital technology can help improve performance across three measured commercial areas: balancing cost, speed to market and quality
Digitalization helps streamline supply chain tasks and save time for suppliers. For example, an online fabric ordering database and order system makes it effortless for suppliers to carry out material preparation ahead of production
People think it’s hard to control quality while keeping cost down. In reality, a digital system can predict and pre-empt potential quality issues, containing them from the very start of the value chain.
Donald Tang agreed, adding how on-demand fashion enables a brand to minimize waste while addressing the “fashion trilemma” – offering the broadest amount of choices, with frequent refresh while addressing inventory management. In this way, bespoke production can actually cost less than mass production.
Divya Demato countered that while there could be fewer articles of clothing upstream, fashion brands still need to consider downstream and post-consumption. She raised a call to innovation and investments in technologies and materials to support more sustainable fabrics for upstream.
In closing, speaking to forward looking change, Veronique Yang added: “Fashion industry companies – you have the responsibility and power and influence and to shape this together.”
In the short Q&A segment, there was much interest in SHEIN’s ability to replicate its business model in other markets. Donald Tang invited Marcelo Claure, Chairman of SHEIN Latin America, who was in the audience, to share about his plans and experience in rolling out manufacturing for SHEIN in Brazil.
The global pandemic has pushed many companies worldwide to improve the sustainability within their supply chains. GoodOps CEO Divya Demato is leading the charge, as they consult with some of the world’s largest companies, exploring new ways to improve their sustainability practices and gain competitive advantages by going green.
Whoever said “leave well enough alone,” was surely not a small business owner in growth mode. Change is not only a product of, but often a prerequisite to, breaking through to the next phase of business growth.
“That surprises some business owners,” says Divya Demato, CEO and co-founder of GoodOps, a supply chain and sustainability consultancy that advises companies on their business strategy. “They think, ‘We had success with this strategy, why change?’ But what you realize is you may have to modify your products or services, or vendors or partners, to be able to scale.”
Growing businesses—and all businesses in today’s ever-evolving business environment—must embrace agility. Whether that means adapting to changing conditions, like a global pandemic, or making strategic adjustments to reach the next level, the key is knowing what to change. Read on for four ways small business leaders must evolve their companies to enable growth.
1. Reshape Your Team For Growth
“Many times, the core entrepreneurial team that got you to this point, some of them may not be able to go on that journey of scale with you,” Demato says.
This can be a tough one—especially for close-knit companies. But it’s a matter of evolving roles and the skills needed for those roles. Small companies often require generalists rather than specialists and operations talent rather than managerial. Larger companies need more specialists and managers. And businesses in growth mode? They require a unique blend of both.
“You’re looking for people who have both entrepreneurial and operational strengths, and it’s a very potent combination,” says Demato. “It’s an interesting time in your business. You’re not so big yet, but you’re not a startup either.”
Small business leaders looking to grow should evaluate their team’s strengths and skill sets to ensure they have the right folks in the right roles and to determine what, if any, gaps in talent exist. This analysis will help leaders strategically recruit or retrain the talent needed to position their company for growth. While the talent market may be tight, offering recruits what they’re looking for now—including flexible work options and diverse teams, according to a 2021 study—can help attract the right candidates.
2. Leverage Customer Data
To grow your business, you have to know your business. Nothing can tell you more about your company, products and—most importantly—your customers, than data.
“If you’re not collecting customer data, you need to begin immediately,” Demato says. “Your business data will tell you the health of your business, but the consumer data lets you know how your consumers behave.” Understanding that behavior will allow you to adjust your sales, products, and marketing as needed to grow.
Many startups, and retailers in particular, choose the visibility and reach of third-party marketplaces to find and grow their customer base. The trade-off is often that the third party ends up owning the customer data.
In order to understand who is buying the product, what they’re willing to pay, what other products they’re interested in and where they’re located, some businesses may need to refresh their ecommerce strategy. If they’re selling through a third-party marketplace, based on the resources available, it may be time to move to their own retail site.
And, of course, they’ll need to learn how to interpret and leverage that data, too.
“You have to have the right people on your team that can make sense of that data,” says Demato.
3. Diversify Your Supply Chain
Growing companies should learn from the struggle that businesses of all sizes grappled with in a pandemic-impacted world. Dealing with uncertainty has pushed businesses to adapt, allowing them to be more agile, adopting new strategies and processes based on what they’ve learned. Small businesses with an eye on growth should do the same by building out their supply chain networks with the potential for disruption in mind.
“Make sure that whenever unforeseen situations happen, you can pull the right levers that keep you in business,” Demato says.
She recommends a two-pronged approach, beginning with a diversified supply base. Having multiple vendors allows businesses to keep operating, even when unexpected events disrupt one supplier’s operations. She also emphasizes the importance of developing strong relationships with suppliers.
“They’re truly your partners. You need them to buy into your vision. Think about their needs, and help them stabilize and be sustainable,” she says. “You want them to grow with you.”
4. Embrace Sustainability
Entrepreneurs have a breadth of options when it comes to sustainable sourcing. Though environmentally friendly suppliers and practices may have been a cost burden in the past, based on her experiences helping companies build sustainable supply chains, Demato has observed a change.
“There are great and very affordable options now,” she says. “The assumption that sustainable operations are more expensive, it’s just not the case anymore.”
At the same time, the costs of not operating sustainably are going up. Consumers, talent and investors all have sustainability top of mind—70% of consumers in a 2021 survey said they buy from brands that share their values. This reveals a clear market opportunity for small businesses. In another 2021 study, 85% of consumers said they have become greener in their purchasing, and more than a third of Gen Z and Millennial buyers say they’re willing to pay a premium for sustainable products.
For many small business owners, maintaining sustainable operations and choosing environmentally conscious suppliers—like Office Depot, whose Office Depot’s GreenerOffice™ line offers products with environmental attributes and ecolabels like cleaning supplies made with less harsh chemicals and paper with recycled content—is an easy first step. Your existing resources and partners are an extension of your team. Tapping into their sustainability opportunities is an efficient way to begin your sustainability journey.
Companies that can authentically communicate their environmental efforts to consumers have a competitive advantage when it comes to attracting and retaining customers. Establishing that rapport allows you to demonstrate that your brand has similar values as your customers and that you care about making a difference.
For small companies, growing does not mean running the same business on a larger scale. With the right people, processes and partners, small businesses can position themselves to reach their growth goals.
