The case study is about Esquel, which is a leading producer of cotton shirts min Hong Kong. The company faced a quandary from its apparel and customers during the era of early 2000. Nike and Marks & Spencer were some of the retail customers who demanded answers from the company concerning is social and environmental. Scrutiny from the customers was proposed by its leaders because most of them had been witnessed demanding that the cotton in their shirts be grown organically. What these customers failed to understand is that the crop required a lot of pesticide and water, which only came from underground sources. They also didn’t understand that a shift to organic cotton would affect the production of the crop, which would reduce by 50%. Moreover, the cotton fibre grown organically is weak and that means it would require extra processing leaving greater percentage after manufacturing. They also require dyes and chemicals that are expensive and environmentally harmful.
Calls for conducting sustainable fashion in businesses came from shareholders, customers, boards, government and employees. They demand for the change of materials to more environmentally friendly ones. Companies in the supply chain are advised to take a holistic strategy to sustainability that would allow for broader pursuant of structural changes. Esquel went as far as helping independent farms apply sustainable farming techniques such as drip irrigation. This enabled it to secure a more reliable major supply in the world. The company also improved its manufacturing techniques that enabled it to win trust from its customers in the emerging economies.
The case continues to explain that biggest opportunities are provided through developing the markets, which also brings about greater risks. This will further involve treating sustainability as a major factor in its operations. Esquel came up with a new recipe, which reduced softener amount, and agents of anti-slippage. This enabled it to save a million RMB in a year and decreased the discharged waste from the garment washing activities. There are advantages associated with sustainable supply chains and transformational marketing, which the company ought to implement.
The most interesting things in the case study include the customers demand to shift their farming techniques to organic ones. The customer also requested for a holistic approach as well as production of more environmentally friendly cotton. Sustainability is treated as a core technique that needs effective management. Moreover, the company managed to save a million RMB per year and agreed to minimize the discharge from garment washing. Lastly, development of sustainable supply chain management has been described in details and in a more interesting manner.
I totally agree with the proposed change to organic cotton because it is more environmentally friendly. The development of sustainable farming techniques and methods was also a great idea as it allowed for structural changes. The technique proposed for winning the trust of the community in those emerging economies was an important step towards the products development and market dominance. However, the abrupt shift to organic cotton is unacceptable because the company needs to manage change in a more comprehensive. This is because production has been greatly affected by this move given that the demand has increased. The idea of giving out payment to farmers before the crop has been harvested seems to be risky. This is because payments are done with little knowledge of what might happen to the crop before it reaches its time of harvest.
The case presents the relationship between a company, its customers, as well as stakeholders. It shows how customers influence the decision process of a company directly and indirectly. According to the case, customer demands should be handled with care and should be given first priority because they are the reason why company does business. All efforts made to develop cotton production have been in relation to customers’ demand as well as market forces. However, not all demands from customers should be taken seriously as they may fail to understand the effects of their demand on the existence of the company or suppliers.
