Corporate Social Responsibility
Debenhams Sustainability Report

Archive for the ‘Supply’ Category

Country wide

Global Sourcing

We require our suppliers and factories to ensure that their employees are paid a fair wage, treated with dignity, are not discriminated against or exploited in any way and have a safe working environment. The requirements are stated in our supplier code of conduct embedded into our policies, incorporated into the suppliers’ conditions of trading, which they are required to adhere to at all times.

We have two overseas offices based in Hong Kong and Bangladesh working with the London sourcing, ethical compliance and quality assurance teams. The Bangladesh office was established some two years ago to support our strategy to increase direct sourcing, enabling us to have more direct open working relationships, more flexibility, control and transparency, as well as benefitting from improved margins. It is working well and expanding to meet additional demand. We are a signatory to the Accord and support the remediation process to ensure building and fire safety, which our Bangladesh Ethical Compliance team manage in collaboration with the UK Ethical Compliance team. In India we have an established relationship with our sourcing partner, which has its own team dedicated to Debenhams, managing ethical compliance and quality assurance with our own sourcing team.

Due to our international and e-commerce growth the Corporate Responsibility team was increased at the start of the new financial year, to support this area of the business to ensure compliance with international legislation and regulation. The team also have dedicated resource for Reach legislation and by the end of calendar 2015 we expect to publish a revised environmental and chemical

Right product, right country

We buy from around the world using a strategy of ‘right product, right country’. Debenhams, ethical sustainable sourcing is essential to our business with focus on potential risks to the business, such as geographical, social, political, economic and environmental considerations, which are captured and managed through the company risk register. We have a good, established and reliable supply base. When looking at new countries and regions, we often work with existing suppliers who know us and the local region, which can help support and manage risk.

Country sourcing 2015

Sustainable sourcing is a complex operation. With the expertise and knowledge we have, with a strong reliable supply base, we can switch between suppliers and factories to manage risk and increase competitive advantage as necessary. For example, rising labour costs in China have led us to increase manufacturing in other countries, such as Cambodia.

Closer to home

Manufacturing closer to home – i.e. using European suppliers can reduce lead times significantly, giving us more flexibility to test a new colour or respond more quickly to consumer trends. We will continue to run pilots in particular women’s wear, to assess the benefits of speed to market and the environmental impact and cost benefits of working with more European suppliers.

Keeping goods flowing

Ship Direct Update

MCC is our first overseas distribution hub, in Singapore, which opened in April 2013. It now services our Middle East franchise partner with direct shipments of more than 65% of their total stock package. Most of our Asian origin stock now ships directly from point of manufacture via Singapore into the relevant Middle East market. This has brought about both significant cost savings and improved lead time (‘quicker to market’) benefits our partners as well as improvements in Co2 emissions and less travel distance. It will also add to our DC (Distribution Centre) sustainability project by diverting volume from our prime UK DC’s.

We have now introduced three more of our Far East franchise partners (Indonesia, Malaysia and Philippines) to be served from this Singapore hub who are now equally benefiting from this initiative. Our plans are to extend on the use of this facility by adding more franchise partners who are in the region to take advantage of the savings.

The Singapore hub is a 70k sqft shared user facility operated by our 3rd party logistic partners Uniserve. We have a dedicated space of 20k sqft with options to expand as the business dictates and we currently process more than 5 million units per year through the facility.

Containers by Train to Sherburn

We have now contracted with rail freight providers to move as many containers as possible by rail from Southampton and Tilbury ports of arrival to our Sherburn DC. This has worked successfully with minimal impact to our product intake and lead times whilst at the same time generating significant cost savings as well as reducing Co2 emissions, which have been captured in our 2014 Carbon Emissions report.

Nearly 11% of all container deliveries were made using this method during 2013/14 removing over 500 (553) vehicle deliveries from the road.

We are now also investigating using feeder vessels into Teesport and using rail options for the onward leg which will increase on the above benefits.