Green apparel, lead-free toys, biodegradable packaging, conflict-free diamond jewelry and recycled paper products are just some of the demands that consumers are putting on the brands that they admire. According to public information supplied by the U.S. Consumer Product Safety Commission, (USCPSC), in one month alone a whopping 3.5 million units of products were recalled due to quality issues. The items ranged from stepstools, toys, casseroles and other products sold at reputable retailers such as Target and Macy’s. To top this, every other day, we hear about retailers being investigated by consumer bodies for their products being produced in sweat shops in third world countries under inhuman conditions.
This is a situation like never before; the pull from consumers for high-quality products produced under better social and environmental compliance standards is making brands re-think the ways in which they do their business. Reducing cost is not the only objective now, being quality conscious and socially compliant has also assumed a greater importance in the last decade in the retail industry. In fact, today, some companies have taken the route of being socially responsible and leaders in quality as a potent differentiation strategy in the marketplace. The ability to provide consumers with products certified for quality, environmental sustainability and free from child or forced labor is a certain advantage. Suppliers who believe in green initiatives and robust quality systems are being lured by brands that leverage such initiatives for marketing their brands to gain higher consumer acceptance.
Today, brands are interested in real results from the products they develop and sell and are not complacent with just a public image of their company being seen as “green”. In his book, “The Wal-Mart Effect,” Charles Fishman describes a seemingly trivial decision by Wal-Mart to get rid of cardboard boxes used to keep deodorant bottles that ultimately changed the world. Every box used to cost a nickel and added to that were the costs of shipping the boxes and putting the deodorant bottles inside. The consumer would take out the deodorant bottle and throw away the packaging. But this action of removing the packaging saved millions of trees, stopped the manufacturing of acres of cardboard only to be discarded by users and reduced landfills of approximately one billion deodorant boxes each year. This saving of $10 million across the United States due to one small decision taken by Wal-Mart more than a decade ago might have gone unnoticed by consumers but the change and the savings are recurrent and permanent for the world’s environment and the whole population.
Retail, footwear and apparel
The roots of quality and socio-environmental compliance lie in the choice of the consumer. Not driven by “needs” but by “wants,” the preference for high-quality merchandise that is sourced “the right way” becomes even more pronounced in the retail, footwear and apparel (RFA) industry. The consumer demands quality goods produced by ethical means, the brands have to endorse it as their business strategy and the suppliers are left with no choice but to conform to the standards set by their clients.
With the information age we live in, this equation is becoming more and more powerful and potent by the day.
The needs of quality and compliance for consumers, brands and suppliers of products in the RFA industry are interrelated and work as push-and-pull forces as shown in Figure 1. Consumers are becoming increasingly aware of the quality, environmental and social aspects of the RFA trade and they demand action from retailers in return for their loyalty to the brands. Brands in the RFA industry represent to a great extent what an individual stands for—a person’s self image, hopes and aspirations, belief systems and overall place in the world. The level of emotional connect is high with the brands they wear and they see themselves as endorsing the actions of what their favorite brand does in the marketplace. Hence, if a brand is seen as engaging in unethical practices or overlooking quality parameters, consumers not only shun the brand but also turn to activism to bring positive changes in the retailer’s or brand’s business operations. This level of “ownership” is not seen in consumers of home appliances or commodities.