HONG KONG: Supply chain transparency "a reality" in 2014
Transparency will become a reality for the global supply chain in 2014, according to a new report.
In its 2013 Q4 Barometer, Hong Kong-based quality control service provider AsiaInspection (AI) said 2013 had been “challenging” for brands and retailers, with supply chain social issues growing in significance, particularly following the Rana Plaza disaster in Bangladesh.
Meanwhile, strikes and riots had hit factories in India, Bangladesh, Cambodia and Burma/Myanmar as workers demanded higher wages and better working conditions.
And a US Department of Labor report in October estimated that 78m children were involved in child labour in the Asia and Pacific region alone.
“The common situation when a Western buying office does not know precisely where the products they purchase are manufactured and what’s going on in their outsourced factories is doomed,“ said Sebastien Breteau, AI CEO.
“Major names like H&M, Apple and HP have published the list for all or part of all their approved suppliers.
“We will see more of such initiatives with major brands taking back full control and enforcing visibility over their suppliers.
“Expect 2014 to be the year transparency becomes a reality in global supply chains.”
AI said brands and retailers had already taken action during 2013, noting a 61% upswing in the number of AI audits across Asia when compared to 2012.
Breaking this figure down, the company said 47% more audits had been carried out in Bangladesh, while the increases for China and India were 58% and 112% respectively.
Buyers were also looking for sourcing alternatives in the region, with AI inspections in Bangladesh up 36%, in India up 44%, in Vietnam up 71% and in Cambodia up 114%.
However, China – where the number of AI inspections was up 17% on 2012 – remained by far the largest sourcing region used by the company’s clients.
Companies: H&M Hennes & Mauritz AB
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