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How to Implement Safer Sourcing and Why It’s Important

You don’t need me to tell you of the laser focus on sustainability in Boardrooms across the world, not least at COP26 currently happening in Glasgow where the good and the great are meeting to agree action to mitigate climate change.

Under ever intensifying pressure from interest groups, investors and customers, companies and brands have been furiously (and quite literally) cleaning up their acts. It’s not simply enough to have faith in a product at the point of purchase, many consumers (and buyers) expect to know the entire lifecycle of a product - from the origins of the raw materials used to produce it to the labour practices and environmental impact throughout its journey into their hands.

Anyone with a smartphone can be a journalist - sharing information and exposing poor business practices at the touch of a button - which has encouraged many companies to upraise their standards and be more selective and demanding of their supply chain, and in turn, more transparent with their customers.

The internet has increased the visibility of the treatment of workers around the world, and people don’t want to buy from brands or stores that support modern slavery.

A relatively recent phenomenon, we’re seeing a battle of sales against ethics, and it’s looking like ethics will win in the long run. Thankfully, engaging in ethical trading has been made easier thanks to technology that makes it easy to track and trace resources to provide transparency to customers.

To ensure a competitive edge, it’s becoming increasingly essential for brands to find a solution that holds them to account throughout their entire supply chain. Retail companies need a trustworthy ecosystem that enables transparent communication between suppliers, brands, retailers, and consumers. They need to be able to reliably demonstrate the entire lifecycle of their products and be able to confidently verify any claims they make about sustainability or ethical sourcing and labour conditions.

Since retail companies are built on the import and export of various materials to develop a product line, supply chains often cross over several countries and connect multiple stakeholders. Because of the complexities of these processes, stakeholders at two ends of the chain struggle to communicate efficiently, creating communication barriers and loss of information across the chain.

However, the advent of technology and software that streamlines the connection between stakeholders to verify their ethical standards offers a solution. It can empower retailers to connect with every touchpoint involved in the process - as well as the end user, such as customers.

Getting into the specifics, companies should look for solutions that help them create a smarter and safer supply chain by providing documentation for every product they sell that clearly documents every component part involved in the production process.

This is where blockchain comes in. Once considered only as the backbone of crypto currencies, blockchain allows companies to interact safely and securely while reducing costs. Many blockchain technologies work through Distributed Ledger Technology (DLT) that enables the platform to be shared among a network of participants to accurately record and share information. Due to its tamperproof nature, no single entity can make adjustments to the data ledger without approval from another entity - making it a single source of truth.

It allows retailers to verify the authenticity of their products and justify the use of health and ethics labels such as “organic,” “sustainable,” and “fair trade” with confidence.

The blockchain data ledger provides a level of traceability previously unavailable to brands - and one that is set to shake things up for good. The impact has the potential to change the way the world does business - while universally and simultaneously upraising standards in supply chain management, sourcing and labour practices.

 

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