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Patagonia A Supply Chain Perspective

Published by Varian Crasto, 2023-07-27 17:41:38

Description: Pantagonia, a well-known outdoor clothing and equipment
corporation, is committed to sustainability and social
responsibility. However, dealing with a sustainable and moral
supply chain is not without its challenges. The organisation faces
various issues such as multiple tiers of providers, limited visibility
past tier one providers, and making sure compliance with
environmental and social standards throughout the deliver chain,
amongst others. In this context, it's far important to explore
solutions and techniques to address those challenges and make
certain a responsible and sustainable deliver chain

Keywords: Supplychain,Varian Crasto,Clothes,Patagonia

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A Supply Chain Perspective Presented to Prof. Akhil Kulkarni Presented by 20111311 Varian Crasto 6 BBA A | Supply Chain Analytics | School of Business and Management

pantagonia| A Supply Chain Perspective introduction | 02 issues and challenges | 03 analysis | 05 solutions | 07 visualisation | 09 conclusion | 10 Page 01

pantagonia| A Supply Chain Perspective

pantagonia| A Supply Chain Perspective introduction Pantagonia, a well-known outdoor clothing and equipment corporation, is committed to sustainability and social responsibility. However, dealing with a sustainable and moral supply chain is not without its challenges. The organisation faces various issues such as multiple tiers of providers, limited visibility past tier one providers, and making sure compliance with environmental and social standards throughout the deliver chain, amongst others. In this context, it's far important to explore solutions and techniques to address those challenges and make certain a responsible and sustainable deliver chain. Page 01

pantagonia| A Supply Chain Perspective issues and challenges from Annual Report of Pantagonia The six months I spent with distant cousins and long-lost family members in Japan will stay with me forever. Supply chain transparency: One of the largest challenges faced through Patagonia is making sure transparency in its deliver chain. The corporation works with providers and factories round the sector, and it is important to make certain that every supplier is adhering to Patagonia's environmental and social standards. To address this difficulty, Patagonia conducts regular audits and inspections of its suppliers and factories, and it has additionally implemented a traceability software to tune the origins of its uncooked materials. Labor practices: Another challenge confronted by Patagonia is making sure truthful hard work practices at some stage in its supply chain. This consists of making sure that workers are paid fairly, have safe working situations, and aren't subjected to compelled exertions or different varieties of exploitation. To cope with this difficulty, Patagonia has carried out a code of conduct that every one of its providers must adhere to, and it conducts regular audits to make sure that these standards are being met. Environmental impact: Patagonia is dedicated to minimizing its environmental effect, and this includes addressing the environmental impact of its supply chain. This includes lowering greenhouse fuel emissions, minimizing waste, and lowering using harmful chemicals. To cope with this problem, Patagonia has carried out various measures, along with the usage of recycled substances in its products, implementing a closed-loop manufacturing procedure, and decreasing using water and power in its manufacturing centers. Supply chain disruptions: Like another employer, Patagonia faces the chance of supply chain disruptions, which can be as a result of various factors including herbal disasters, political instability, and economic downturns. To address this trouble, Patagonia has implemented a chance control software to perceive potential deliver chain disruptions and develop contingency plans to mitigate these dangers. Page 03

pantagonia| A Supply Chain Perspective Supply chain management is a crucial function for In addition, Patagonia faces challenges associated businesses like Patagonia that prioritize with labor requirements throughout its supply sustainability and social responsibility. To make chain. The organisation has a duty to make certain sure compliance with its environmental and social honest hard work practices and secure working standards, Patagonia faces a number of challenges conditions for the duration of its supply chain, but and troubles that can make it difficult for the implementing those requirements may be tough. To business enterprise to uphold its requirements for address this mission, Patagonia can work with the duration of its supply chain. One of the providers to improve hard work conditions and offer maximum extensive demanding situations is the training and support on the way to meet its complexity of the supply chain itself, which involves requirements. This can involve organising KPIs more than one tiers of providers. This complexity related to exertions requirements, such as reducing makes it tough to trace the origins of raw materials using child hard work or improving wages and and might lead to demanding situations in ensuring blessings for employees. that each supplier is adhering to Patagonia's requirements. One capacity solution to this venture Patagonia additionally faces challenges in figuring is to enforce traceability systems and gear that out and mitigating supply chain dangers. To address enable the organization to tune the motion of this venture, the company can establish supply uncooked substances and completed goods via the chain threat control applications that contain supply chain, taking into consideration extra everyday hazard checks and the development of visibility and manage. contingency plans for capacity disruptions. This also can contain working intently with suppliers to Additionally, Patagonia faces language and cultural expand joint risk management plans that permit the boundaries when running with providers and organisation and its providers to paintings factories in different countries and regions. This can collectively to become aware of and mitigate make it hard to communicate successfully with capacity risks. providers and make certain that they apprehend and comply with Patagonia's requirements and \"Pursuing sustainability in supply chain expectancies. One manner to cope with this is not only a challenge, it's an challenge is to establish clear conversation opportunity to create a better world.\" protocols and invest in schooling and ability constructing for providers, supporting them to Finally, Patagonia faces demanding situations better understand the company's expectations and related to dealer diversification. To cope with this requirements. assignment, the corporation can set up supplier range applications that prioritize sourcing from Moreover, Patagonia has confined visibility past its providers who meet its environmental and social tier one suppliers, making it tough to ensure standards, whilst also working to perceive and transparency past this stage. To deal with this onboard new suppliers who meet those standards. assignment, the employer can put into effect supply This can involve growing relationships with chain risk control applications that allow it to suppliers in new areas and investing in supply chain become aware of and mitigate ability risks inside its infrastructure and logistics to permit the supply chain. This may additionally involve organization to source from a more numerous set of leveraging technology and statistics analytics to providers. reveal dealer performance and discover capacity issues earlier than they turn out to be foremost In conclusion, Patagonia's supply chain faces a troubles. number demanding situations associated with environmental and social duty, as well as logistical Another key trouble that Patagonia faces is ensuring and operational complexities. However, through compliance with its code of conduct among its implementing supply chain threat management providers. To cope with this mission, the agency can applications, organising clean conversation set up deliver chain compliance applications that protocols, and investing in dealer ability building involve ordinary audits and inspections of suppliers and schooling, the organisation can deal with those to ensure that they're adhering to Patagonia's challenges and ensure that its deliver chain upholds requirements. This can also involve imposing key its environmental and social standards. overall performance indicators (KPIs) associated Additionally, by way of setting up key overall with sustainability and social obligation, including performance indicators (KPIs) associated with lowering carbon emissions or enhancing working sustainability and social obligation, the organization conditions, that suppliers are required to fulfill. can encourage suppliers to improve their performance and meet the organisation's standards. Page 04

pantagonia| A Supply Chain Perspective analysis from Annual Report of Pantagonia \"Challenges in Patagonia's supply chain drive innovation and sustainability.\" Percentage of recycled materials used: This KPI measures the proportion of recycled materials used in the production of products. For instance, Patagonia aims to use 100% recycled polyester in their products by 2025, which is a key KPI for them. By increasing the use of recycled materials, Patagonia is reducing their carbon footprint and minimizing their impact on the environment. Time to recover from disruptions: This KPI measures the time it takes for a company to recover from supply chain disruptions, such as natural disasters, pandemics, or geopolitical events. It's essential to have a quick and effective response to minimize the impact on the supply chain. For instance, Patagonia worked on diversifying its supplier base to mitigate the impact of disruptions and implemented a risk management plan to reduce the recovery time. Percentage of products with traceable supply chains: This KPI measures the percentage of products with a fully traceable supply chain. It means that the company can track the products' journey from raw materials to finished products. For instance, Patagonia is committed to traceability and transparency, which allows them to identify issues and take necessary actions. Patagonia achieved 100% traceability for down, wool, and cotton in 2020. Percentage of suppliers in compliance with a code of conduct: This KPI measures the proportion of suppliers that comply with the company's code of conduct, which typically outlines ethical, social, and environmental standards. For instance, Patagonia has a strict supplier code of conduct and requires suppliers to comply with it. They also conduct audits and inspections to ensure that suppliers are meeting the standards. Page 05

pantagonia| A Supply Chain Perspective Pantagonia's commitment to sustainability and Another essential KPI for Pantagonia's deliver chain moral sourcing is contemplated in the key is the percentage of products with traceable supply performance indicators (KPIs) that it uses to screen chains. The corporation has been working to its deliver chain. These KPIs offer a manner to increase the traceability of its deliver chain by way measure and music progress towards the of using gear like blockchain era to tune the motion organization's sustainability goals and ensure that of products and make certain that they're sourced its supply chain companions meet its ethical from moral suppliers. This KPI facilitates Pantagonia standards. to have a better understanding of its supply chain, identify any ability dangers or troubles, and take One of the KPIs that Pantagonia makes use of is the proactive measures to deal with them. proportion of recycled materials utilized in its merchandise. This KPI is an critical measure of the The percentage of providers in compliance with the employer's dedication to reducing its environmental code of behavior is likewise a essential KPI for effect. By using recycled materials, Pantagonia Pantagonia. The agency has a strict code of behavior reduces the need for virgin assets, which can help to that every one suppliers must adhere to, which reduce the carbon footprint of its products. This KPI incorporates necessities related to hard work is frequently used within the context of round standards, human rights, and environmental economy, a idea in supply chain control that sustainability. This KPI facilitates Pantagonia to pursuits to limit waste and maximize resource make sure that its providers are working ethically usage. and sustainably, reducing the danger of any bad impact on the surroundings or society. Another crucial KPI that Pantagonia tracks is the time it takes to recover from disruptions in its Another critical KPI for Pantagonia's supply chain is supply chain. This KPI measures the enterprise's supplier compliance with labor standards. This KPI potential to respond to sudden events along with measures the quantity to which providers are natural screw ups, political instability, or dealer adhering to the enterprise's labor standards, which bankruptcies. By tracking this KPI, Pantagonia can consist of requirements related to fair wages, make sure that it has contingency plans in place and working hours, and safe working situations. might quickly recover from any disruptions that Ensuring supplier compliance with exertions arise. This KPI is often called the standards is important for Pantagonia to keep its "resilience" KPI in deliver chain moral and sustainable recognition. management. The number of identified supply chain dangers is Pantagonia additionally tracks the proportion of likewise a critical KPI for Pantagonia. With multiple products with traceable deliver chains. This KPI stages of providers and confined visibility beyond measures the organization's capacity to song its tier one providers, it is important to identify and merchandise from uncooked substances to mitigate any capability dangers or issues. This KPI completed products. By having a traceable deliver facilitates Pantagonia to proactively manage and chain, Pantagonia can ensure that its products are mitigate deliver chain dangers, reducing the hazard made using moral and sustainable practices. This of any disruptions to its supply chain. KPI is regularly referred to as the "traceability" KPI in supply chain control. Supplier diversification tasks are every other essential KPI for Pantagonia's deliver chain. The Ensuring that its providers observe its code of employer has been working to diversify its provider behavior is another essential KPI for Pantagonia. base, reducing its dependence on a unmarried This KPI measures the percentage of providers that provider or region. This KPI facilitates Pantagonia to meet the corporation's ethical and environmental reduce its supply chain dangers and improve its standards. By tracking this KPI, Pantagonia can resilience to disruptions. ensure that its supply chain companions are aligned with its values and commitments. This KPI is often Finally, the carbon footprint per product is a called the "compliance" KPI in deliver important KPI for Pantagonia's deliver chain. The chain control. corporation is committed to lowering its By monitoring this KPI, Pantagonia can make sure environmental effect and has set bold objectives to that its deliver chain companions deal with their obtain carbon neutrality through 2025. This KPI employees with dignity and admire. This KPI is often facilitates Pantagonia to measure its progress called the "hard work standards" KPI in toward accomplishing this intention and perceive supply chain management. regions for similarly improvement. Page 06

pantagonia| A Supply Chain Perspective solutions from Analysis conducted \"Challenges in Patagonia's supply chain drive innovation and sustainability.\" Multiple levels of suppliers: Companies often must address multiple ranges of suppliers, that can cause complexity in handling their deliver chain. In such instances, it can be challenging to perceive and control risks related to every tier, specially while there's a lack of visibility and manipulate. To cope with this venture, corporations can increase a comprehensive supply chain mapping system that identifies all the ranges of suppliers and enables them to display their performance and compliance. Limited visibility beyond tier one providers: Companies regularly face difficulty in gaining visibility past their tier one suppliers. Lack of transparency within the deliver chain can pose dangers together with terrible operating situations, environmental damage, and non- compliance with policies. To triumph over this venture, organizations can work with providers to establish a gadget for sharing statistics and data, that can permit them to advantage greater visibility and control over their supply chain. Ensuring compliance with environmental and social requirements across the supply chain: Companies have to ensure that their providers follow environmental and social standards, which include exertions rights, protection, and sustainability. This can be mainly difficult for businesses with a huge and complex supply chain. To deal with this, organizations can increase a supplier code of behavior that outlines their expectations for dealer behavior, set up auditing and monitoring mechanisms, and provide education to providers on environmental and social compliance. Managing and mitigating deliver chain risks: Companies need to be organized for diverse dangers which can impact their deliver chain, which include natural screw ups, political instability, and dealer financial ruin. To control these dangers, organizations can behavior everyday hazard checks, expand contingency plans, and set up relationships with multiple providers to ensure continuity of deliver. Page 07

pantagonia| A Supply Chain Perspective Supply chain control is a critical factor of any Ensuring compliance with environmental and social employer's success, and for a business enterprise standards across the supply chain is another like Patagonia, which is understood for its assignment faced by Patagonia and other agencies. sustainable and moral practices, coping with their Patagonia has a strict code of behavior for his or her deliver chain is of maximum significance. However, suppliers, which includes environmental and social there are numerous demanding situations and requirements. The use of Supplier Scorecards, which problems that companies face of their deliver chain, song provider performance in areas which includes and Patagonia is not any exception. Some of those sustainability and ethical practices, can help challenges are a couple of ranges of providers, Patagonia perceive regions for development and language and cultural obstacles, constrained work with their providers to improve their visibility beyond tier one providers, limited performance. resources for retaining deliver chain transparency, ensuring compliance with environmental and social Managing and mitigating deliver chain risks is any standards across the supply chain, dealing with and other assignment confronted by groups of their mitigating deliver chain risks, addressing labor and supply chain. Patagonia can use threat control human rights issues inside the supply chain, making techniques along with chance identity, assessment, sure sustainable sourcing of uncooked materials, and mitigation to control and mitigate deliver chain addressing the carbon footprint and environmental dangers. The use of Supply Chain Risk Management effect of the deliver chain, and balancing ethical (SCRM) gear and technologies can also assist considerations with price-effectiveness in deliver Patagonia become aware of and mitigate deliver chain choices. chain dangers in a timely manner. One of the primary challenges faced by way of Ensuring compliance with environmental and social Patagonia and different corporations in their supply requirements throughout the deliver chain is some chain is handling a couple of levels of suppliers. The other primary mission that businesses like deliver chain for Patagonia is complex and involves Patagonia face. This includes ensuring that suppliers several levels of suppliers, making it difficult to adhere to environmental and social standards which control and monitor. The use of Supply Chain KPIs include waste reduction, carbon emissions discount, including on-time delivery rate, inventory turnover labor requirements, and human rights. To make ratio, and order accuracy can assist in monitoring certain compliance, groups can set up a Supplier supplier performance, figuring out areas for Code of Conduct that outlines the expectations and development and making facts-pushed selections. requirements for all suppliers in terms of Patagonia also can use superior supply chain environmental and social practices. Patagonia has technologies along with blockchain to increase its very own Code of Conduct that providers are visibility and transparency of their supply chain, expected to adhere to, which covers regions making it easier to perceive problems and take consisting of forced exertions, baby hard work, corrective moves. running hours, fitness and protection, and environmental duty (Patagonia, 2022). Language and cultural limitations are every other venture faced by agencies of their deliver chain. \"Collaboration, transparency, and Patagonia has suppliers all around the global, and innovation are key to building a more verbal exchange can be tough due to language and sustainable and resilient supply chain.\" cultural differences. The use of common deliver chain jargon and language can assist in bridging this Managing and mitigating supply chain risks is some hole, enhancing communique and collaboration with other crucial project for businesses. Supply chain providers. Patagonia also can offer cultural and risks can stand up from a selection of factors, language education to their employees to assist together with herbal disasters, geopolitical them better apprehend their providers' cultures and instability, monetary shocks, and dealer bankruptcy. practices. To manage those dangers, corporations can broaden They may now not have whole visibility into their a comprehensive risk control approach that consists suppliers' suppliers. This lack of visibility can make of chance evaluation, threat mitigation, and danger it tough to make certain compliance with monitoring. Patagonia also can offer cultural and environmental and social requirements throughout language education to their employees to assist the whole supply chain. Patagonia can use Supplier them better apprehend their providers' cultures and Relationship Management (SRM) equipment and practices. This method must include measures along technology to music their suppliers' overall with identifying alternative providers, creating performance, perceive areas for development and contingency plans, and investing in supply chain mitigate risks. resilience (Rugman) Page 08

pantagonia| A Supply Chain Perspective visualisation Patagonia's supply chain KPIs reflect its commitment to sustainability and ethical business practices. The company uses a high percentage of recycled materials in production, has a relatively short time to recover from disruptions, and prioritizes traceable supply chains and compliance with labor standards. Patagonia conducts a significant number of supplier audits and inspections to identify and mitigate supply chain risks and supports supplier diversification initiatives. The company also monitors its carbon footprint per product to reduce its impact on the environment. Page 09

pantagonia| A Supply Chain Perspective conclusion Pantagonia's commitment to sustainability and moral sourcing offers both opportunities and challenges in their deliver chain control. The analysis of the organisation's deliver chain problems and challenges highlights the want for more transparency, collaboration, and risk mitigation efforts. Through imposing numerous answers, together with investing in era and dealer diversification, Pantagonia can hold to enhance its supply chain performance and sustainability practices. By prioritizing these efforts, Pantagonia can lead the way in responsible deliver chain management and set an example for other groups to observe. Page 10

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