Traceability must be a “non-negotiable” for the fashion industry

  • Written by Laura Houghton
  • Published on 30 August 2023
  • Blogs

Both financial and sustainability performance have never been more important and Traceability can bring huge benefits to both.

Textile and apparel companies could be missing out on billions of dollars in net profit enhancements from a lack of supply chain traceability, according to insights gleaned from leading industry analysts, organisations and think tanks.

supply-chainTraceability – the ability to gain detailed insight into the supply chain – enables companies to better measure and improve their environmental and social impact. Planet Tracker's Lifting The Rug Report found that companies without traceability systems are missing out on a net profit enhancement of 3% to 7% – the equivalent of approximately USD 3 to 6 billion per year for a company earning USD 80 billion per annum.

John Willis, Director of Research at Planet Tracker, comments:

The textile and apparel sector is facing heat from all sides regarding its environmental impact, with toxic production practices, degradation of natural resources, massive and growing waste, as well as labour injustice. New regulations are on the horizon and consumers are expressing increasing dissent at unethical practices. But still not enough is being done, because not enough is being said about the potential economic benefits

The tools for companies to have full traceability through their supply chain exist, and companies do have the expertise to put these tools into action and deliver real insight. ‘It’s not possible’ is an outdated response to the lack of traceability and reporting. Every company now requires data insight and evidence in order to be able to promote its sustainability credentials, this can't be achieved without proof of full traceability – which may involve some transparency measures. Business of Fashion (The Traceability Tech Aiming to Unlock a More Sustainable Industry) stated;

Creating a centralised system for sustainability metric calculations, data collection and supply chain transparency is essential to making meaningful progress against social and environmental goals

Industry Findings also conclude that the cost of implementation would be more than offset by the enhanced productivity resulting from traceability. And this is in tandem with the sustainability, social and risk mitigation benefits.

71% consumers Drapers Sustainability and the Consumer report found that 77% of consumers say they consider sustainability when buying fashion, with another 33% of consumers saying that  they have stopped shopping with brands that do not reflect their sustainability values. So it isn't surprising that retailers are keen to promote their sustainability credentials. However, even companies who are confident they are doing it right need traceability to protect against accusations of greenwashing, which are rife at the moment, no matter their ethics. Board Pro (The seven benefits of good governance) said;

Good governance can increase business sustainability and profitability, build a positive reputation and create a healthy culture within an organisation. Other benefits include efficiency, error visibility, smoother operations, and financial sustainability

There has been much information and research published over the last few years on supply chain traceability and its close links to ESG, why it is important, what are the risks and opportunities, and why companies must take action.

Common to all aspects of ESG, compliance and profitability is the need for multi-tier supply chain transparency. Using insights gleaned we have published a white paper; The Direct Link Between Supply Chain Transparency and ESG, that attempts to summarise why businesses can no longer wait to implement a solution.

Hobbs Quote 2Companies must focus on supply chains and collect data that enables them to baseline, focus and drive improvement.

Having a centralised repository of such data will enable buying, sourcing, product, technical, quality, supply chain and sustainability teams to align their decision-making and focus on delivering sustainable products from ethical suppliers, in turn creating efficient supply chains and products that are better for people, and the planet.


Segura's unique Supply Chain Transparency, Compliance and Reporting Platform is proven to enable retailers and brands to get the robust transparency, data and evidence they need to map their entire supply chain, measure its ESG compliance, identify risk, and align cross-departmental decision-making to your ESG strategies and KPI’s.


To read more about the business case for investing in supply chain traceability see Segura's proven commercial benefits.

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