The Hidden Cost of Apparel Sustainability: Doing It Alone

Indulge me as I tell you about an experience I see a lot.

An employee at a mid-sized company has been given the “opportunity” to lead sustainability at her company. She might work in compliance, or sourcing, or operations, or maybe even in HR. She’s finally carved out some time from her main job to work on sustainability. She’ll take about an hour to remember where she left off the last time she worked on this… maybe a month ago?

Next thing she knows, her browser has 10 tabs open and her desktop is littered with spreadsheets. She has a supplier email asking, “What do you mean about Scope 3?”. She’s not totally sure herself, so she skips to the next email. Marketing wants to know what to say about being sustainable. Hmm… next. Let’s go to the consultant we hired for this effort… he needs all of the Bill of Material (BOM) data to even get started. So she reaches out to her product team to get it, only to find that they have information that three years old.

Does that stress you out?

It should. But that’s the practical reality for so many people working in sustainability.

And it’s preventing them from doing anything actually productive, which causes her (and her boss) to wonder why she’s even working on this, let alone actually doing anything to make the planet healthier.

Here’s the problem: Sustainability is being run as a side project, but the expectations are enterprise-level.

That is disparity is costing you.

Remember, if you fail to prepare you are preparing to fail. - H.K. Williams

At the root of this problem is that sustainability, as a business need, kind of creeps up on companies in apparel. You get one question from one customer. It’s a little weird, but you dutifully dig in and answer.

Then another customer asks a more direct question. You answer it. Two points make a line.

Then a third customer asks you to provide more than an answer, but a report. Uh oh… three points make a trend.

Someone in sourcing gets assigned an additional duty. It’s cheaper than hiring someone and keeps the org chart neat. You can maybe hire a consultant if you need to support her.

You decide to swap in some recycled polyester, publish some goals in an impact report, and hope that this blows over.

But it doesn’t, because sustainability in apparel is massively dependent on your supply chain, has evolving regulations, and requires a lot of data. Marketing relies upon what you come up with, opening you up to worries on greenwashing, so you decide instead to overcorrect into greenhushing. Operations has no idea about what’s going on, so nothing gets changed.

When you finally sit down with it, you realize that you might have failed to plan on this. Sustainability isn’t a campaign, but infrastructure.

Core Problems & Hidden Costs

When your company sits down and decides to get serious about this, a few core problems become obvious.

· Materials and manufacturing dominate apparel emissions, so most of the problems are outside the company and in your supply chain.

· Sustainability reporting touches 10 business functions, so it requires cross-functional coordination.

· Supplier data collection becomes a prime bottleneck, because you have to collect data manually via email. 62% of companies say the same.

· You’re expected to reach deep into your supply chain by your bigger, better resourced customers, even though they aren’t.

By going it alone, you’re baking in some major hidden costs.

· Your sustainability hero is overworked. If she leaves, you’re hosed. Back to square-one. And she’s getting burned out in a system that doesn’t scale.

· Your “free” spreadsheets get messy fast. That’s because you don’t have good version control and you’re unsure which emissions factors they’re using. Forget about being able to trace SKUs and pray you don’t have to face an audit.

· Your suppliers are ambivalent or even hostile to your requests. You get it – the last thing you want to see is another survey asking the same questions, but in a different format. Your suppliers are, too.

· Exposure to greenwashing claims. Even if you keep your marketing team religiously on message, you have to prove what they’re claiming. And if your evidence requires digging into a dozen spreadsheets, who will believe it? You certainly don’t want to be lumped in with those who have made misleading claims.

· Inability to handle compliance creep. You’re facing requirements on EPRs, new restrictions on unsold goods, and assurance expectations. Is your spreadsheet system up to it? Probably not.

· Falling behind. The brand leaders for sustainability are being established right now. Those that are investing in it are gaining efficiency gains, cost reductions, and brand differentiation. Those that silo sustainability are losing those opportunities.

Sustainability as a Strategic Capability

Sustainability isn’t a part-time task for a teammate or even a department; sustainability is a strategic advantage.

Instead of doing an annual reporting scramble that leaves you feeling tired and unsure of the product, winners build this capability.

Winning apparel companies will create a governance structure with defined ownership and ongoing data collection into a clear architecture. They’ll empower their suppliers with tools that leave them relieved instead of annoyed. And they’ll embed checkpoints into each product’s lifecycle.

There’s functionally a minimum viable system for mid-sized companies that have decided to plan to win on sustainability.

1. A data plan

Your company will need to have and maintain three fundamental data assets.

· Supplier map & facility list. Start with your tier 1 suppliers, but you will need to quickly move upstream with your leading suppliers or when your supplier is just a middleman / exporter.

· Materials library. What are your products made of? Do you have the certificates and tracking systems to understand it? How about to prove it? This is a core operational capability.

· SKU-level composition. BOMs are often a mess. They’re incomplete and use assumptions on the ancillary materials like tags, stickers, and stitching. Winners get this under control for a lot of reasons, but sustainability is a big one.

2. Sustainability gates

There are a lot of points in which sustainability decisions get made. If you’re not incorporating sustainability-information at those times, they cannot be fixed later. Make it intentional that at design brief, material approval, vendor booking, and marketing claim reviews that sustainability and climate are checkpoints that must be passed and not ignored.

3. Ownership distribution

If you have gates, but don’t have broad ownership of sustainability, you cannot have accountability. This can tempt you to centralized – don’t. Design owns materials, Sourcing owns suppliers. Finance owns data. Marketing owns validation. These roles aren’t new, just the requirement that it measured against sustainability objectives are.

4. Empowered suppliers

This might be the biggest one. Your suppliers likely represent 70% (or more) of your emissions footprint. Just as you’ve empowered your team to make climate-informed decisions, you need to do the same with your suppliers.

You’ll need to start by impressing upon your suppliers that this is a strategic and permanent objective of your company and will increasingly inform your supplier decisions. Don’t threaten, just impress with your earnestness.

Knowing that suppliers are facing a variety of requests from their customers, try when available to align with their other requests and standardized to well-accepted formats. Then go the extra step – give them a solution that helps them to collect, store, and report their own data.

5. Assurance structures

You might not face audits yet, but we all know it is coming. Frankly, we should expect to be able to prove anything that we claim, in sustainability or elsewhere. So to future-proof for the obvious, make sure you have good processes for documentation and traceability that will provide for audit trails and align with evolving standards.

It’s a system, not a side-project

You won’t fail because you lack intention. You’ll fail because you failed to plan by underestimating complexity, rely too much on one or a few individuals, and delay building the systems you need to win.

Doing so has costs with burnout, compliance, supplier frustration, and lost opportunities.

The good news? You’re not alone right now. Only 7% of companies feels they have maturity in these systems. But the race is on.

So, remember, sustainability cannot be a side project. You have to build the operational infrastructure to win.

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