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Maintaining Local Production in the Outerwear Industry

Submitted by Kevin S. on January 5, 2009 - 12:05.
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About
Associated Group(s): 
Canada Goose™
Location: 
Toronto, Canada
Content
Summary: 

Canada Goose is a Canadian manufacturer of extreme weather and performance outerwear that sells to markets around the globe. In 2008, sales figures were around 20 million CAN.

Canada Goose products have become the outerwear of choice for the Canadian Arctic Rangers, scientists of the American National Science Foundation in Antarctica, Canadian Special Military, First Air - Canada’s largest northern airline, as well as the majority of smaller northern Canadian airlines and many other people and organizations who have come to trust this reliable, high-quality product.

Apart from being functional, many of the jackets are of stylish design and have caught on with celebrities and fashionistas in New York, Stockholm, Milan or Tokyo.

Family-owned and operated from Toronto Canada since 1957, the company faced the dilemma of moving production to overseas contractors in the early nineties. Their strategic decision to persist with local and integrated production of garments, despite an overwhelming market trend pulling in the opposite direction, has generated a positive social return, reinforced corporate reputation and added value to the brand, especially in luxury markets.

Metro Sportswear stands out as a responsible company in its sector because, unlike almost every other outerwear manufacturer these days, it has kept its production facilities in Canada and continues to pay factory workers a decent wage ($15.00/hr. on average).

Implementation: 

In the late eighties/early nineties, the Canada Goose manufacturing facility was winding down its production, like many textile facilities across North America. At that time, management had to decide whether to shut down operations entirely, outsource manufacturing overseas or to put new energy towards stimulating sales and keeping production local. Unlike most of its competitors, Canada Goose chose the latter option.

Money was invested into newer production facilities and efforts were made to develop the brand as a quality upscale product with international appeal. With a skilled and loyal workforce (some had been with the company for decades), Canada Goose could assure the highest quality of its down filled parkas and the ‘Made in Canada’ authenticity of the brand open doors to overseas markets.

The company’s sales rose greatly in the last 10 years and a larger workforce was sought, still in the Toronto area. The company now overseas two external production units in Canada and maintains a regular presence at these locations.

Challenges and Solutions: 

As with most of the textile workforce in North America, workers are generally older and few young people choose to pursue this line of work. It is therefore an ongoing challenge to think of how to find a renewable local workforce.

Paying decent North American wages to garment workers considerably raises the costs of production when compared those of competitors paying subcontracted production costs overseas. The locally-made products can therefore be competitive only in high end markets where there is enough of a margin to absorb the production costs.

Social and Environmental Benefits: 

Canada Goose now provides 400 full or part-time jobs in Canada, jobs which return capital to Canada’s economy and jobs which are framed and protected within Canada’s excellent labour standards. Had these jobs been contracted overseas, similar work standards would have been nearly impossible to ensure.

Results: 

Keeping production in Canada has allowed Canada Goose to build a brand based on the authenticity of Canadian know-how and experience born of cold climates. The Canada Goose brand, like other high end products such as Rolex watches and Land Rover vehicles, is coveted because it is made by those who personally know the conditions the parkas will be exposed to.

The ethical and environmental added values of local production have also opened doors for the company to very advantageous relationships with select retailers such as Sporting Life in Canada and the Sundance Resort store in the United States. In both cases, retailers were attracted not only by the quality products but also, and maybe especially, by the values behind the brand.

Socially responsible restructuring

Submitted by Izold Monnier on January 6, 2009 - 09:57.
in
About
Associated Group(s): 
Gildan
Location: 
Mexico
Content
Summary: 

Companies regularly make the headlines with restructuring plans that result in painful job cuts and other unfortunate consequences. However, some firms set themselves apart by taking a more responsible approach to managing their social restructuring; they anticipate necessary measures, offer to find decent employment elsewhere for employees being laid off (redeployment), and respect the interests of all stakeholders involved. The closure of two factories in Mexico (known as “maquiladoras”) run by sportswear company Gildan is one such example. The company made sure to help the 1,300 employees affected by the closures, recognising the important contributions they had made to the company’s growth and success in recent years.

Implementation: 

-Anticipate factory closures to ensure that there is adequate time to implement proper social measures that take into account the various types of employees and attempt to redeploy as many as possible;
-Initiate a constructive dialogue with various stakeholders in order to create a maximum number of opportunities to redeploy employees with:
o- local governments: financial partnership to support employment assistance programs;
o- local labour rights organisations: the Maquila Solidarity Network (MSN) and SEDEPAC;
o- other companies in the area.

Challenges and Solutions: 

-Managing a delicate situation: announcing the closure of a factory is always sensitive and leads to distrust and anxiety among workers and local institutions. In the case of Gildan in Mexico, the closure of the two factories was announced in a social context that was already quite tense due to recent job cuts at another company that left 1,700 people without work.
-Socially responsible restructuring imposes certain costs that must be borne: the price tag for Gildan’s most recent restructuring (the closure of its two factories in Mexico, two more in Canada and one in the United States, with a total of about 2,000 workers laid off as a result) came to $21.5 million. This highlights the importance of planning for social restructuring far enough in advance to ensure that sufficient funds can be set aside.

Results: 

Gildan provided its laid-off workers with generous collective benefits and introduced additional measures in specific cases:
- severance pay above the legally required amount (based on the average wage of the previous 12 months, with payment beginning 45 days before the closure);
-a contribution of $232,000 (2.3 million pesos) to a government employment assistance program to retrain large numbers of employees for other careers in the automobile industry (a sector that has grown substantially in the area);
-health insurance coverage for employees for one year (beyond the eight months required by law), which offers some comfort to workers who have difficulty finding other employment or have suffered a work-related injury or illness. The coverage also applies to female employees who give birth after the factory has closed;
In this way, Gildan has created a positive impression by providing its former employees with the means to overcome the loss of their jobs, at least for the short term. These measures have set a precedent and may raise the bar with regard to the treatment of employees in Mexican maquiladoras that have gone through social restructuring.

Other Examples: 

The Danone Group:
In March 2001, the Danone Group announced plans to reorganise its biscuit division; this involved various social assistance measures and the re-industrialisation of the affected sites.
The social assistance component was provided by teams created to help workers and protect jobs; known as the Job Mobility Link, its mission was to help employees find the best employment solution from a number of options. One of the plan’s measures focused on internal mobility, whereby workers were offered jobs at other Danone sites and provided with training programs that grant diplomas in various fields.
A second measure was external deployment, in which affected employees received two job offers at other companies in the region; the measure was promoted in various ways, such as through exemptions from the period of notice.
A third measure was specifically aimed at employees aged 55 and over, providing them with an income equivalent to 85% of their former gross salary until retirement.
Offering help to start or take over a business was another measure, providing technical and financial support to encourage employees interested in starting their own company.
A further measure involved assistance to stakeholders; Danone made a commitment to local communities to compensate for any losses in economic activity or tax revenue and to make every effort to create more jobs.
However, it should be pointed out that Danone apologised for mismanaging its communications when the restructuring began. Management was slow to properly relay the extent of the reorganisation; this was mostly for political reasons, since elections were to take place soon. As a result, employees were not kept sufficiently informed.

Damart chooses its stationery items in a responsible way

Submitted by World Forum Lille on December 19, 2008 - 21:54.
in
About
Associated Group(s): 
DAMART
Location: 
France
Content
Summary: 

Damart, a company conscious of its environmental responsibilities, decided to change things as far as the purchase of stationery items is concerned. This is indeed a cross departmental field and it enables every employee, as an integral part of the whole company, to become aware of how things can be changed.

Damart is doing this by cutting by 20% the use of stationery items with a high ecological footprint such as sheets of paper or print cartridges.

Implementation: 

Recyclable paper is collected in specific boxes in every office, in partnership with the Clinitex cleaning company. Print cartridges are collected in partnership with the Conibi and Alter Buro companies to recycle them.

Recycled paper is used in priority. Documents that can be printed in a lower quality within the company (such as pay slips, and delivery slips) are identified, and printers and copying machines are provided so.

Printing waste and envelopes containing internal documents are collected to make stationery items such as notebooks, file folders, etc.

Some documents are converted to PDF files: product documents, some accounting documents and financial records.

There are more and more departmental printers, and less documents are printed by the employees as a result.

Every employee is made aware of the company's approach. When stationery items are made available by the purchasing department, information is given on an intranet and through posters located near the copying machines and the printers.

Social and Environmental Benefits: 

• Damart provided a paper refuse disposal company with 1,536t recyclable paper and cardboard ; its accounts for 26,112 trees, that is to say 522t CO2 absorbed.
• 30% recycled A4 paper format was bought for office needs. So far, this has saved 350 trees.
• The employees are proud of the corporate ethic and the way they now use stationery items.

Results: 

♦ Each ton of recyclable paper is bought from the company at a rate of 26,70 euros ; Damart’s return on investmenr is 41,053 euros a year as a result.
♦ Buying recycled organic paper has saved Damart 3,500 euros.
♦ Converting printing waste into stationery items has Made Damart save 2,700 euros.

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