How APR – TrusTrace are Becoming Future-Ready Using Traceability?
Supply chains in the fashion industry are often complex, with many brands having little visibility beyond their tier one and two suppliers and many suppliers not being able to communicate their material story with the customers
Customers, society, and, increasingly, regulators, are demanding more information, but mapping these global supply chains remains a challenge.
It was to help address this gap, that APR collaborated with TrusTrace in October 2019. The partnership enabled APR and TrusTrace to share data across their traceability platforms.
APR’s Follow Our Fibre platform provides traceability and transparency across its production value chain from seedling to viscose staple fiber, while TrusTrace maps the entire garment value chain from garment to fabric to yarn to fiber and the source of the fiber.
TrusTrace value chain from garment to fibre
Fast forward to June 2020 and the initial goal of combining data has been achieved, but there remains more to do, says Cherie Tan, Vice President, Sustainability and Communications, Asia Pacific Rayon.
“We have actually done what we set out to do, but I think what we’ve learned through this initiative is trying to understand our supply chain along with the supply chain of TrusTrace customers and we understand that there is still some gap, as the current value chain is still one or two tiers away to build an end to end product traceability from the network of customers,” she says. “So there is still a problem with the entire value chain not being joined up.”
While increasing numbers of downstream companies are paying attention to traceability in their supply chains, it’s not going far enough to connect to upstream producers. And that’s what made the APR partnership so interesting, says Shubham Kulshrestha, Senior Manager of Business Operations at TrusTrace.
“When we talk about traceability, it’s mostly always top driven, where a brand/retailer/customer initiates a request and we go down to the tiers below,” he says. “And that was the whole idea with this project – we wanted to initiate efforts towards establishing upward traceability.”
Currently, the industry approach to traceability is fairly fragmented. Many companies make their data available, but often it’s done through a bespoke platform. That means that tracking a single supply chain may involve the use of multiple platforms, not all of which can integrate with one another.
The partnership between APR and TrusTrace is an attempt to change that model, says Cherie. “What we felt was that as an industry, it should not be about one system per se, but about the ability of systems to speak to each other. I think TrusTrace very much believes in the same value of transparency across not just the industry and amongst the actors in the value chain, but actual transparency in the systems as well.”
“The eventual goal should not be to promote a particular platform, but to make the data contained on various platforms as accessible, and as useful as possible”, says Shubham. “The overall idea, probably some years down the line, is that there would be one unified system and a platform like TrusTrace would be part of that bigger value chain. In order to be future-ready, we have ensured that our system is built on international standards like GS1 to enable easy communication with different systems and actively supporting the unified system by establishing a seamless data flow.”
Blockchain is now well known, at least as a concept, but like all new technologies, it will take time to mature. It has the potential to transform supply chains by making information on each stage of the production process freely available. And while progress is certainly being made in that direction, there remains more work to do.
“The fact that customers and brands can only see as far as their tier one or tier two suppliers but can’t go further down the supply chain shows that the way this information is shared is very fragmented,” says Cherie.
Follow our Fibre from seed to viscose bales
“As an industry, we should really come together and look at ways for data to be bridged across platforms and systems, because at the moment we’re not there yet. We’re showing that it can happen, but I think it needs to be much more accelerated.”
Part of the challenge is that companies can be reluctant to share their data due to concerns over how it might be used. But increasingly the market is demanding more disclosure, whether that’s from regulators and certification bodies, or ethical consumers wanting to make more informed choices.
Eventually, customers will be able to walk into a clothing store, scan a QR code, and learn about the source of the raw materials and the conditions in which the garment was made. If it then comes down to a choice between buying from a brand that is transparent with its data versus another that is not, customers are likely to vote with their wallets, says Shubham.
Consumers can scan a QR code to learn about the source of the raw materials
And there is already evidence of this information being used to influence purchases. TrusTrace works with several e-commerce companies that present TrusTrace’s data to customers on the product page.
“They are doing that because they’ve seen an incremental shift in their business,” says Shubham. “By sharing this information they are able to prove that their garment is sustainable, organic, eco-friendly, and that increases the sales. So there is a very clear business case.”
While many businesses will be looking for a financial return on their investment in traceability, it also provides additional benefits beyond direct sales. Globally there is increasing attention paid to the impact of the fashion industry on the environment, and having a more transparent supply chain allows brands to communicate positive stories about the impact they are having on the ground.
APR for example works with local communities in Indonesia to help them develop their skills and increase their livelihood. A more transparent supply chain enables those positive stories to be told to the shoppers who buy clothing made using APR’s viscose rayon, and not just to APR’s immediate customers.
“So ultimately, this is not only a tool to demonstrate transparency, but it’s also a tool for communications,” says Cherie. “It’s a tool to drive much more continuous improvement and hopefully at some point collaboration with brands so that brands have positive stories of the supply chain to communicate to consumers.”