Triple bottom line of sustainability and supply chain
Section 1: Executive Summary
Sustainability in a company refers to the coordination and management of social, environmental, financial demands, and resources to guarantee ethical, responsible, and successful service delivery. A significant number of companies across the world incorporate a variety of models and strategies such as the triple bottom line approach to ensure continuous growth and success of a business. One of these companies is the Reformation fashion brand in the United States. The second approach to the triple bottom line is corporate social responsibility, which helps companies integrate environmental and social concerns in their business. Reformation is one of sustainable business in the US that provide unique or limited edition clothing in the eco-friendly factory. The company gets significant profits while adding value to the people and the planet that defines its sustainability nature. However, it needs to improve its strategies and incorporate new approaches such as more advertisement through online channels to increase profits and stay relevant in the industry.
Triple Bottom Line of Sustainability and Supply Chain
Section 2: Introduction
Businesses across the world apply different strategies, management techniques, and sustainability practices to ensure that their companies remain competitive in the industry. Over the past few decades, fashion brands and supply chain companies have experienced tremendous changes to sustain their business and stay relevant. The performance pressure is a result of the increased competition as well as standards and the ever-growing needs of customers all over the world (Slaper & Hall 2011). Sustainability in a company refers to the coordination and management of social, environmental, financial demands, and various resources to ensure ethical, responsible, and smooth operations. Business sustainability is also known as corporate sustainability, and it is an issue confronting all businesses today no matter the place or their size (Slaper & Hall 2011). Increasingly, many corporations are finding that embracing sustainable logistical practices leads to better corporate culture, delivery of quality services, long term profitability, and success. In the context of Reformation Company, sustainability involves the use of renewable or environmentally friendly materials, recycling, effective cost management, robust waste diversification, and the use of renewable energy sources. The company’s sustainable fashion brand is described as “a good balance between edgy, sexy and feminine.” If Reformation Company continues to embrace recycling, working under quick circles, use of renewable fabrics, triple bottom line supply chain and streamlined logistical systems, it is bound to realize increased profitability and production efficiency.
Section 3: Literature Review
Triple Bottom Line: People, Planet, Profit
A significant number of companies across the world, including Reformation, incorporate a variety of models and strategies such as the triple bottom line approach to ensure continuous growth and success of a business. The triple bottom line, also known as TBL, is an accounting framework consisting of three crucial parts that cater to improve the environmental, social, and financial value of a company (Slaper & Hall 2011). Many organizations are using the TBL framework to evaluate performance purposely to create higher business value. The preference of the TBL framework is attributable to its ability to help organizations measure their financial, environmental, and social performance over time.
Today, companies have realized that the survival of a business does not necessarily rely only on products and profits but also on the people and the planet (Slaper & Hall 2011). Millennials today have impacted purchasing behaviors and activities. They also demand more from brands rather than just adequate products. Hence, companies must adapt. Sustainability in business is another significant element that enterprises must not ignore. Sustainability is defined as the ability of a company to offer products and services continuously (Slaper & Hall 2011). Sustainability has three main pillars, including economic, environmental, and social, that are informally known as the people, planet, and profits, which essentially forms the sustainability concept known as the triple bottom line.
As mentioned above, the triple bottom line takes into account three key factors, people, planet, and profits, which help a business become socially responsible (Slaper & Hall 2011). A significant number of individuals agree and support the use of the triple bottom line framework. However, it is difficult measuring some of the factors such as the people and the planet since they involve ecological health and human welfare. Profits are easy to measure, define, and discuss since money is easy to measure or count. Applying or implementing the triple bottom line is strenuous and overwhelming for many businesses (Biron 2019). Nonetheless, managers and leaders are advised to hire experienced consultants to help or use specific tools to get started.
Concerning the planet, it can be saved by reducing carbon footprint and achieving carbon neutrality through carbon offsetting. The people in the triple bottom line can be measured by evaluating community work hours, training, and charitable contributions. It has become apparent in the recent past that customers feel safer or prefer to do business with socially responsible companies. The preference is attributable to the quality of fashion designs, cost of acquisition, and sensitization programs on recycling procedures that reduce costs (Biron 2019). Notably, companies that implement the triple bottom line framework do not only enjoy the satisfaction of delivering value for people and care for the planet, but they also gain more revenue. Table 1 below shows that customers care about clothes’ design, but more than 50% of customers also care about sustainable fashion.
Table 1: Do Shoppers Care About Sustainable Fashion?
About Reformation in the United States
As one of the most powerful countries in the world, the United States holds a significant market share in the fashion industry. The US adaptive clothing market value stands at $44.5 billion based on a 2018 report and is expected to grow up to $51.8 billion by 2022 (Biron 2019). The increasing revenue levels make the US a competitive and a leading country in the global fashion design industry. Apart from professional business attire, American fashion is known to be eclectic and predominantly informal. The Americans diverse cultural roots are mostly reflected in their clothing, particularly those of immigrants. Boots, cowboy hats, as well as leather motorcycle jackets, are indicative of specifically American styles. In the world, New York City is known as one of the big four global fashion capitals, along with Milan, Paris, and London.
One of the fashion companies or brand that has ensured the continued growth of the American fashion industry is the Reformation clothing brand. Reformation is a “cool girls” fashion design company with stores in different locations, including Los Angeles and New York City (Biron 2019). Currently, it is expanding into brick-and-mortar at a period when retail brands are opening stores across the United States (Robinson 2018). It sources all its materials locally or domestically in the US, including human resources. The cutting and sewing of the materials are done in Los Angeles, and manufacturing of most products is done in its factories. The company uses technology to manage its value chain and do shopping in stores. Administratively, Yael Aflalo is credited for launching the company with the aim of growing an eco-friendly label fit for everyone (Biron 2019). The leading fashion design outlet opened its doors for business in 2010 at its Los Angeles headquarters. Since its inception, the company has grown from strength to strength. For instance, it has expanded structurally, gained entry into new markets such as Culver City, stretched its product range, and tripled profitability index.
The notable sustainable products that Reformation Company produces include Ref jeans, Blush dress, Prima dress, and other types of women apparels. The products are on high demand since customer wants influence their production. The company engages customers through hang tags newsletters and our labels platforms. Besides, it promotes sustainability by considering all the costs rather than just the price tag as well as investment in programs that replace the spent resources. Compared to other fashion companies in the United States, Reformation put sustainability at the core of everything it does or its operation. It invests in green building infrastructure to minimize water, waste, and energy footprints. Reformation also provides on-the-job opportunities and training for growth and recycling practices, which make the revolution possible.
Corporate Social Responsibility (CSR)
Corporate social responsibility (CSR), is a self-regulating concept that helps companies to be accountable to the public and stakeholders socially while ensuring that the emerging concerns are addressed (Grayson & Hodges 2017). CSR is the way through which a company achieves a balance of environmental, economic and social imperatives, also known as triple bottom line approach, while simultaneously addressing the expectations and needs of the stakeholders (Wang, Tong, Takeuchi & George 2016). In this case, it is crucial to make a distinction between CSR or philanthropy and charity. CSR is a strategic business management concept, while charity is a poverty reduction tool. Charity enhances the reputation of an organization and strengthens its brand. According to Grayson & Hodges (2017), CSR is now on the agenda of many companies, including Reformation fashion group. The concept in combination with the TBL approach, help businesses meet their environmental and social standards without compromising competitiveness. Reformation clothing brand applies CSR and TBL, by advancing financial stability within the industry, eliminating any negative environmental impact and acting to meet societal expectations. Therefore, the company is considered a sustainable business.
The wholehearted adoption of the CSR concept enables Reformation Company to connect with the customers and other stakeholders effectively. It also empowers the company to plan and deliver tailor-made solutions to the emerging cost, environmental, labor standards, and community relations issues (Yakovleva 2017). So far, the strategy is beneficial owing to the competitive advantage that it creates such as increased access to markets, capital, and operational cost savings. Other benefits include improved quality of cloth designs, productivity, enhanced customer loyalty, attractive brand image, and better risk management processes. As a consequence, the company’s turnover rate is highly impressive while the sales capacity stands at 80% of all the fashion designs produced. Similarly, the company uses 100% renewable energy credits and collaborate adequately with the brand fabric team members, logistics handlers, designers, and customers courtesy of the CSR incentives (Yakovleva 2017). Therefore, CSR plays a significant role in the success of a business, especially those that involve manufacturing and direct contacts with the clients such as Reformation Clothing brand in the United States.
Supply Chain Models
From experience, supply chain and logistics act as the backbone or the foundation of positive returns in every business. Supply chain refers to the sequence of events that helps a commodity or businesses to move raw materials from manufacturing through to the market or the end-users (Grayson & Hodges 2017). The supply chain comprises people, equipment, transportation modes as well as technology. Both service and manufacturing companies have defined supply chain that contribute to the quality of output. The supply chain looks more like a web with the manufacturer at the center, while raw material suppliers, distributors, and consumers are at the tail ends. Essentially, all businesses need a reliable supply chain management model to guarantee a higher return on investment. Companies must choose the most appropriate model from the six supply chain models.
First, there is a continuous flow model in the supply chain that offers stability in high demand situations where insignificant variations on features are reported. Companies that mobilizes resources and reorganizes their value chain to produce similar products repeatedly have the potential of benefiting from the model. The model has traction because it supports commodity manufacturing (Eksioglu 2001). The second crucial model is the fast chain model. The model is perfect for manufacturers that produce trendy items with short life cycles. In this context, it is best for businesses that envision and embodies frequent change in their product line or dispose of products before the trend ends. Considering the incentives, the model is appropriate and flexible for companies like Reformation Corporation (Eksioglu 2001). Efficient chain model forms another impactful tool of progress within the value chain in companies. The model is ideal for organizations that operate in very competitive business sectors, including markets where the end-to-end efficiency is the premium goal.
Moreover, the custom-configured model enables companies to develop products that characterized with customized configurations (Eksioglu 2001). The configurations take place during assembling and production stages. Generally, the model is viewed as a blend of the agile model and the continuous flow model. The agile supply chain model, which is a method of management is the fifth type of supply chain. The model is perfect for businesses that deal with product distribution and ordering. Lastly, the flexible model in the supply chain enables enterprises such as Reformation Company to plan and budget towards meeting the growing demand for products, especially during peak periods. Likewise, the model allows companies to manage long periods of low volume movement effectively (Wang et al. 2016). The model can be switched on and off easily. Generally, efficient supply model and fast chain model are suitable for Reformation Company. Efficient supply model would create sustainability in the Reformation Company’s business by facilitating the flow of operations and timely access to raw materials. It would also enable the company to stay competitive and the production of low-cost clothes. On the other hand, the fast chain model would catalyze the company’s drive to produce trendy products and embrace the fashion changes effortlessly.
Case Study: Reformation Clothing Brand
Since 2014, the Reformation fashion brand has become a fascinating and irresistible brand for cool girls who include models. The latest trend has enabled the company to adopt the direct-consumer sales strategy. The items are sold and distributed through designated online shops and three other physical boutiques that are within Los Angeles and New York City. As a consequence, potential customers’ access to quality fashion designs stress-free. The company has grown not only in sales but also in its team of employees and product range (Biron 2019). Riding on the achievements, it is expected to increase sales volumes and profit levels in the coming years.
Aflola, the founder of Reformation, started the brand with the desire to market “killer” clothes without destroying or damaging the environment. With its attempt to encourage and support a sustainable fashion brand, the company’s products are designed, tailed, photographed and shipped from their innovative and advanced eco-friendly factories in Los Angeles. Moreover, each design is made using renewable and repurposed vintage clothing and salvaged deadstock fabric (Biron 2019). The company’s concepts and operations fully support maintaining sustainability in the business by using sustainable practices, fit for purpose strategies as well as through unique selling points.
Sustainable Practices at Reformation
A significant number of companies across the world provide quarterly earnings reports. However, Reformation Company gives sustainability reports apart from the revenue data. More specifically, they report on all the sustainable practices implemented in a particular year. After comprehensive research, one of the sustainable practices implemented at Reformation is a Rafscale that tracks the environmental footprint in its products in terms of CO2, water, and waste. The company reduces its networks to invest in low impact alternatives in all stages of manufacturing, such as LED lighting, eco-fabrics, and 100% recycled packaging (Eksioglu 2001). While global warming detriment the Earth’s surface, Reformation works hard to keep doing better and have minimal impact on the environment.
Secondly, Reformation Company uses sustainable processes in fabric dyeing and finishing. First, the company test all materials against the Restricted Substance List (RSL) to eliminate hazardous substances in the products, guarantee their safety, and promote their compliance with the international laws. The RSL list applies to the raw materials, finished products or goods, and its concentrations (Biron 2019). More specifically, the company uses Bluesign certified dyeing facilities that use safe input chemicals, monitor the water and air emissions, including worker safety. The precautionary measures ensure that the dyed fabrics are harmless to the workers, the end-user, and the environment. Considering its effectiveness and the safety it guarantees to the environment, the process is identified as a sustainable practice at Reformation fashion brand.
Thirdly, Reformation has a sustainable supply chain which ensures sustainability in the business throughout the year. Over 90% of Reformation products are made in the US in its factories, which are audited by a third-party (Biron 2019). The third-party monitoring strategy promotes safety, fairness, and a healthy working environment or conditions. It also works with a variety of vendors to address emerging issues efficiently and effectively. In an attempt to produce and sell clothes made from quality materials and non-toxic brands, the company launched a Sustainable Partners Guidebook for the direct factories and subcontractors. The strategy streamlines operations and logistics between suppliers, retailers, wholesalers, and the company. Reformation Company also provides better hourly wage and health benefits for full-time employees. The incentives increase their job performance and improves sustainability through recycling and designing products with the materials at hand.
Lastly, the company maintains sustainable operations using functional and eco-friendly technologies and socially responsible practices available. It ensures that all operations are efficient and that employees finish their duties on time. The goal is attained by installing renewable energy credits, collecting fabrics, scraps, and recycling them (Biron 2019). Other ways of achieving the goal incorporate the use of electric vehicle charging for Refs drivers, carbon-neutral retailing as well as offering factory tours for customers and visitors. In the future, Reformation aims at innovating the fabrics, developing transparent and fair supply chains and mainly better products which will put the company at the center of the fashion industry across the world.
Fit for Purpose Strategy
Reformation Company’s model of customer focus is explicit and mainly aimed at fitting its operating strategy. However, it is socially representational since it captures a significant number of women in their 20s and 30s. The model synchronizes with the company’s founder desire to design urban creative styles that are free but not neglecting. The company’s overall aesthetic fit their target of a perfect woman who should be a bit rock-and-roll, bohemian, and sophisticated. This promotes an ideal balance for minimal cuts, femininity, and being on-trend without complications (Pinnock 2018). For Reformation, the right product is crucial, and Aflalo demands that design, style, and fit is spot-on. The company applies several techniques and strategies such as TBL and ethical supply chain to streamline production. This ensures systematic production and designing of outfits for real women with any body type as an alternative to a one-style-fits-all approach. The clothes on offer are affordable, elegant, and designed to look flattering on different body types, including curvier and fuller physic body structure.
Reformation’s Unique Selling Point
Most of the products at Reformation are made with repurposed vintage fabrics, and deadstock fabrics, hence, everything created is a limited edition. The strategy helps the business to design and produce clothes in different cuts and styles. That is, the company customizes the items based on unique customer needs (Pinnock 2018). Further, the company’s limited editions approach creates a sense of urgency among customers. This makes them have a feeling that if they desire a product, they need to purchase it immediately, or it disappears forever. The approach is beneficial to the company as it results in higher sales volumes and an increase in customer numbers. After a detailed analysis, it is apparent that the repurposed and deadstock fabrics enable Reformation Company to resolve some of the technical challenges that are associated with the materials being used in production. Reformation’s team focus on the designs and the materials procured; hence, they create better products for their customers. In consideration of the above factors, Reformation is a sustainable fashion brand that incorporates various strategies and processes to ensure the production of quality products. As a result, the company makes more profit while bringing value to the environment and society without any form of destruction.
Recommendation and Conclusion
The General Fashion Industry
Following the growth of the global economy, many industries are needed to improve performance to compete and gain relevance among other sectors. The fashion industry is no exception. First, fashion companies and brands need to adapt and enhance their sustainability footprint, just like Reformation has done over the past ten years. Secondly, they need to adopt new technologies that are mainly designed to improve the textile industry. According to Shamir (2018), technology is improving how businesses operate with the use of artificial intelligence, virtual technology, and data analytics. Also, these new technologies can help fashion industries create better fabrics resulting in improved products. Moreover, the fashion industry should strengthen their ethics and emphasize on developing sustainable brands and responsible items. Lastly, fashion companies should pay more attention to the increasingly changing needs and expectations of customers across the world. Many of the customers care about designs and products; therefore, they should work towards creating unique items that meet the clients' expectations.
For Reformation Fashion Brand
As a fashion brand, Reformation can follow the above recommendations. However, it can also use other strategies given its unique stand and products in the market. Reformation Company should apply more advanced strategies to remain relevant in the industry. It is recommended for the company to increase its online presence and reach more millennials in the United States and beyond. Given the improved technology across the world, this process can reach a significant number of individuals globally, which will triple profits while spreading more of its benefits to society. Likewise, Reformation Company should open more branches and shops in other cities in the United States as well as expand operations in different countries across the world.
Thirdly, Reformation Company should apply and improve its current strategies such as the triple bottom line approach, its CSR concept as well as maintain a sustainable supply chain and other practices. The approach is necessary to ensure continuous production and distribution of quality products. Additionally, the company should start new clothing lines that include products for women over forty years and teenagers. Individuals today are more interested in how they look, hence, creating new and unique items may improve the company’s sales and profits.
Conclusively, though the fashion industry is competitive, applying the recommended strategies can help Reformation, and other companies to sustain performance, good supply chain and profitability while protecting the planet and the people. No company can thrive and maintain competitiveness in isolation. They must develop vibrant strategies that foster stakeholder collaboration, inclusive decision-making, innovation, and the use of modern technology. Reformation company is in the right performance trajectory because it trailblazes the fashion industry using renewable operating systems. For instance, it promotes recycling of materials, use of renewable resources, including energy within its value chain, and sensitization of customers to wash garments in cold water. Other renewable initiatives include the use of a robust waste diversion program, customer engagement labels, and cost-based spending.
List of References
Biron, B 2019, How Reformation won over 'cool girls' by filling a void left by H&M and Forever 21. Business Insider. Available from: <https://www.pulse.com.gh/bi/strategy/how-reformation-won-over-cool-girls-by-filling-a-void-left-by-handm-and-forever-21/vw5hh7b> [18 June 2019]
Eksioglu, B 2001, Global Supply Chain Models. Encyclopedia of optimization, Vol. 2. No. 3, pp.890-893.
Grayson, D & Hodges, A 2017. Corporate social opportunity!: Seven steps to make corporate social responsibility work for your business. Routledge.
Pinnock, O 2018, Sustainable Fashion Searches Surged In 2018. Forbes. Available from: <https://www.forbes.com/sites/oliviapinnock/2018/11/20/sustainable-fashion-searches-surged-in-2018/#28f28615fe70> [20 November 2018].
Robinson, M., 2018. This apparel startup fixed the worst part of shopping for clothes in stores — and it could defy retail's curse. Business Insider. Available from: <https://www.businessinsider.com/how-reformation-clothing-stores-beat-online-shopping-2018-1?IR=T> [18 January 2018].
Shamir, S 2018, How technology is changing the fashion industry, TNW. Available from: <https://thenextweb.com/contributors/2018/08/14/how-technology-is-changing-the-fashion-industry/> [12 March 2018].
Slaper, T & Hall, T 2011, The triple bottom line: What is it, and how does it work. Indiana business review, Vol. 86. no. 1, pp.4-8.
Wang, H., Tong, L., Takeuchi, R & George, G 2016, Corporate social responsibility: An overview and new research directions: Thematic issue on corporate social responsibility. Academy of Management Journal, Vol. 59, no. 2, pp.1-87.
Yakovleva, N 2017, Corporate social responsibility in the mining industries. New York: Routledge.
Appendix
|
Crop/Raw Material |
Processing /Production |
Warehousing Transportation’ Distribution Centres |
Retail, Consumption, Post consumption | |||
|
Economic (Profit) |
Excellent and high-quality raw materials enable companies to produce good products which bring profits. However, if the materials used or needed are unavailable or expensive, it causes significant damages to a business. |
Sustainable practices in production ensure quality end product, which guarantees high sales and higher profits. However, poor quality or unfinished products lead to low sales and profits in a company which affects the general fashion industry and the economy. |
Warehousing and transportation are critical factors in maintaining sustainability in a business as it promotes good supply chain bringing in profits. However, if it is poorly managed, it leads to losses and angry customers. |
Retail play a crucial part in the supply chain as it helps reach goods to end-user for consumption which brings profits and value. However, products do not reach the intended target market in incorrect retailing which leads to company losses. | ||
|
Social (People) |
Availability of raw materials provides job opportunity in developing businesses. But some materials used result in global warming which harms health of the people. |
Production in textile industries provides jobs for a significant number of individuals which improves their living conditions. However, due to the use of cotton and other fabrics, it can lead to health issues and diseases such as lung and respiratory problems. |
Proper warehousing improves social interactions among if the goods are prepared and delivered in time. But if the process is unstable, it creates disrupts company operations which leads to losses and affects the people relying on it. |
Proper retailing and consumption encourage people to more social interactions, which increases brand awareness leading to profits. But if customers are not aware of where to wear certain products, it could lead to brand ridicule and immense losses as well as detriment in social life. | ||
|
Environment (Planet) |
Repurposed, reused, and recycled raw materials have minimum waste hence they help protect the environment. However, some materials used in textile industries destroy the environment through CO2 emission and waste materials. |
Sustainable practices in production in textile or fashion companies help bring profits as well as protect the people and the environment. However, engaging in unethical or irresponsible production activities destroys the environment. |
Excellent warehousing and distribution centres help save time and resources used which ultimately helps protect the environment since little harm is experienced. However, improper and ineffective processes lead to excess use of raw materials which leads to more waste which destroys the environment. |
Proper retailing motivate individuals to use clothing items more responsibly without damaging the environment. Inadequate retailing force people to discard items without finding the need to recycle or repurpose the clothes which damage the environment. | ||
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