The Big Game and Supply Chains

| Jan 30, 2020 | BY Seth Lennon

Editor’s Note: This article was written by Ronan O’Kelly for the Sourcing Journal on Tuesday, January 17, 2012 and is republished on the WRAP blog with the author’s permission.

Emerging Asian markets have seen a surge in demand for compliance certification, according to the world’s largest labor and environmental certification program for the apparel manufacturing sector.

Speaking with the Sourcing Journal, Director of Compliance Administration for Worldwide Responsible Accredited Production (WRAP), Avedis Seferian, explained that, although China remains the largest market for compliance certification, attention has recently begun shifting towards growing markets in Southern and Southeast Asia.

“Demand tends to track existing sourcing patterns,” he explained. “Southeast Asia is in ascendancy as China is starting to be seen as less competitive than it has been in the past.”

Bangladesh – a country that has been regularly criticized in the past for its sub-standard factory conditions – shows the largest rate of growth for WRAP certified factories, Mr Seferian said.

“This is a country that has become an increasingly popular sourcing destination for buyers in both Europe and the United States and is, in fact, second only to China as a sourcing destination for the apparel sector.

“It was therefore very logical for WRAP to enhance our presence in the country in the form of opening a local office, which we did earlier this year, in Dhaka, and engaging more directly on compliance issues there.”

India, Pakistan and Vietnam rank alongside China and Bangladesh as the countries containing the highest number of WRAP certified factories.

Demand from buyers seeking to work with WRAP certified factories is also on the rise, according to Mr Seferian.

While demand for WRAP certification has traditionally come from the United States and Europe, “as awareness of the importance of social compliance spreads around the globe, we’re also starting to see Asian brands as well as Australian buyers actively seeking out WRAP-certified factories to source from”.

The increase in demand for greater testing and compliance among brands comes despite growing difficulties in the global retail environment, including rising costs of goods and depressed sales.

Avedis Seferian explained that, even with the added expenses associated with compliance, WRAP certification can be a cost-saving investment for manufacturers.

“Any factory with good working conditions will see more motivated and therefore more efficient, workers, leading to increased productivity and, thus, profit,” he said.

“The other big benefit of a WRAP certification is that it allows factories to meet the compliance requirements of a large number of brands and retailers, thereby sparing them the need to have separate, individual compliance audits done by each one of those buyers.”

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Seth Lennon

Seth Lennon