Global suppliers band together to improve purchasing practices

Industry Associations from Turkey, Indonesia and Morocco join Asian Associations in IAF and STAR Network Initiative on 'Manufacturers Payment and Delivery Terms'

Four major industry associations, the Indonesian Textile Association (API), the Turkish Clothing Manufacturers Association (TCMA), the Istanbul Ready-Made Garments Exporters' Association (IHKIB) and the Moroccan Association of Textile & Clothing Industries (AMITH) are joining the new initiative by Asian manufacturer associations to drive better purchasing practices in the textile and garment industry. The initiative, started by the STAR Network, supported by GIZ FABRIC, the International Apparel Federation (IAF) and the Better Buying Institute, presented their plans at the OECD Forum on Due Diligence in the Garment and Footwear Sector on February 3rd, 2021. This marks a joint global effort led by manufacturers to establish a common position on payment and delivery conditions in the industry.

The initiative on 'Manufacturers Payment and Delivery Terms', which has been officially launched on January 12th, comes as the apparel and footwear industry works to better connect supply to demand, reduce waste, and improve profitability, recognizing that buyers and suppliers must strengthen their relationships to both support pandemic recovery and prepare for future supply chain disruptions As Miran Ali, Director at BGMEA and STAR Network spokesperson, said at the OECD Forum: “Following the pandemic, there should be a complete reset of the buyer-supplier relationship; we should not revert back to the norm.”

In collaboration with various global stakeholders, the STAR Network, GIZ FABRIC, IAF and the Better Buying Institute are creating a safe space for manufacturers to jointly draft a set of minimum expectations and outline recommendations and best practices related to payment and delivery conditions. This includes establishing certain red lines and core principles that they deem essential for fair legitimate business.

“Suppliers from around the world are coming together to offer solutions for strengthening global supply chains,” said Dr. Marsha Dickson, President and Co-Founder of the Better Buying Institute. “Suppliers often have the best ideas for how to overcome challenges and the impacts of brand and retailer purchasing practices on workers and the environment. It’s critical their voices be heard.” Matthijs Crietee, IAF Secretary General adds “In the end, improvements in purchasing practices are essential to driving industry-wide change.”

“Suppliers participating in this effort represent roughly two-thirds of the global market share of global apparel and footwear factory exports, which represents unprecedented collaboration in the industry. Participants include members of the STAR Network and IAF, including: Vitas (Vietnam); CNTAC (China); GMAC (Cambodia); MGMA (Myanmar); TMA, PHMA and PTEA (Pakistan); BGMEA and BKMEA (Bangladesh); TCMA (Turkey); API (Indonesia); and AMITH (Morocco). “The fact that there is fierce competition among manufacturing countries is not an impediment to collaboration,” Miran Ali noted.

The initiative is supported by GIZ’s regional project FABRIC Asia, built on the input from STAR Network and IAF/ITMF members and managed by IAF with support from Better Buying Institute. The first phase of the project will run until March 31st of this year.