- Vivian Hendriksz |
London - Better Buying, an initiative that supports the industry-wide transformation of buyer purchasing practices, has launched its first benchmark report designed to support efforts to improve purchasing practices throughout the global supply chain.
Known as the Better Buying Practices Index (BBPPI), the report found that the length of a relationship between buyers and suppliers does not have an impact on the nature of buying practices, contrary to popular beliefs. After studying data anonymously submitted by suppliers working with buyers in the apparel, footwear, and household textile industries around the world, the benchmark report found that it does not matter whether buyers have had relationships with buyers for one, five or even 20 years, as suppliers overall experience the same purchasing practices.
The first benchmark report found that the overall Better Buying score for buyers was 2.5 out of 5 stars (on a 0 to 5-star rating system), which meant that the types of buying practics suppliers face result in significant challenges. The report also found that while suppliers were paid on time and at the price agreed upon in most cases (4.5 stars out of 5), suppliers were not rewarded for compliance to buyers codes of conduct and legal requirements and received highly inconsistent order volumes from month to month (0 in sourcing and order placement).
"Current business practices are unsustainable and need to be overhauled if we expect companies to achieve financial, environmental, and social sustainability goals," said Marsha Dickson, Ph.D., Better Buying co-founder in a statement. "Brands and retailers must provide their suppliers with predictable business, sufficient lead times, fair financial deals, and incentives for compliant factories. The BBPPI empowers suppliers to share concerns about poor supply chain management and the issues they face."
Better Buying benchmark report, supported by the C&A Foundation and Humanity United, is the first initiative to track and release performance scores and analysis concerning buyer practices in the fashion industry. The benchmark report summarized key findings from the first cycle of BBPPI data collection during the fourth quarter of 2017 and includes ratings from 156 suppliers across 24 countries while measuring the performance of 65 buyers.
The benchmark report then measured buyer performance against seven categories of purchasing practices, including planning and forecasting, design and development, cost and cost negotiation, sourcing and order placement, payment and terms, management of the purchasing process and CSR Harmonization.
"The BBPPI supports brands and retailers, multi-stakeholder initiatives, investors, and other stakeholders looking to improve purchasing practices," said Doug Cahn, Better Buying co-founder. "Rather than assessing the policies and procedures of buying companies, it instead measures their impact on suppliers using confidential data-driven surveys."
Photo: Courtesy of Better Buying, copyright Marsha A. Dickson.