Business Development: Patagonia's Green Purchasing Project Report

This report provides an in-depth analysis of Patagonia's sustainability efforts, beginning with a company history and an examination of its environmental and social impact. The analysis covers governance, social impact (including worker conditions and civic engagement), and environmental impacts such as waste reduction, resource conservation, and carbon footprint reduction. The report also delves into Patagonia's product development and life cycle, including the use of recycled materials and their supply chain practices. The author recommends that Patagonia gain more control over its supply chain by investing in or acquiring production facilities to further reduce its environmental footprint and improve social conditions for workers. The report concludes with a timeline for achieving sustainability goals and outlines a plan for long-term investment in production facilities to enhance operational processes and implement sustainable innovations.

GREEN PURCHASING: INDIVIDUAL
PROJECT
Executive summary :
· Company history (page 1)
· Analysis of the sustainability of Patgonia (page 1-6)
· Recommendations (page 7)
· Conclusion (page 7)
· References and citations (page 8)
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Company history
The company was officially created in 1965 by Yvon Chouinard. Passionate of climbing
since his childhood, the young American decided to create his own climbing speaks and
swivels because the climbing material at the time was not resistant enough. Then he
was travelling from beach to beach and mountain to mountain for surfing and climbing.
He lived off the sale of his climbing material that he created in his trunk. In 1965, with his
new associate, he created Chouinard Equipment and the manufacturing started to
become industrial. At this time, he also opened his first store in Ventura, California,
which is now the corporate office. Chouinard Equipment quickly became the main seller
of climbing equipment in the United States. In 1972, the company was replaced by
aluminum stoppers because peaks damaged cliffs creating cracks. This is how “clean
climbing” was created. The same year the company launched some solid and innovative
outdoor sport products designed around a rugby shirt that Yvon bought for climbing
during his travel in Scotland. After looking for new materials for his product, Yvon with
help of his wife created Capilene and Synchilla: two textiles who are supple, stay warm
and dry very fast. In the 80’s, while travelling, Yvon started to understand and be
sensitive to the growing ecological crisis. In 1986, Patagonia committed to redistribute
10% of its benefits every year to NGO working for the preservation of the environment.
In 1994, after the first sustainable audit of Patagonia, the company understood that the
nylon and the polyester (made of petrol) were not the most pollutant, but in fact, the
cotton, a natural fiber, had a catastrophic impact on the environment. So, the company
decided that, from 1996 they will use only 100% biological cotton for their products.
Nowadays, far from the greenwashing of some organizations, Patagonia keeps trying to
encourage activism. In 2002, the father of Patagonia, Yvon Chouinard created a
federation called “1% for the planet”. This federation regroups companies that are
engaged for the preservation and will distribute 1% of their turnover to environmental
associations.
Even now Patagonia is selling typical outwear like jeans, shirts or T-shirts, the main
products of Patagonia stay outdoor/sport equipment and clothes. Their products are
known to be good quality, functional and comfortable.
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Analysis of the sustainability of Patagonia
Governance: I think that sustainability and environmental care is a part of what
Patagonia is. We saw that even in 1972, Yvon took some risk by drastically reducing his
production of peaks to replace it by aluminum stoppers because of the negative impact
on cliffs. Aware from a long time now, about the environmental crisis, the company has
followed since more than 40 years his engagements for the sustainability of the planet.
We can find many examples of these long term engagements. Now that Patagonia is
pretty well established on the market and has pretty good visibility, in addition to trying to
find sustainable solutions and options in every company’s processes and sectors, the
company can share its ideas, engagements and encourage activism to peoples who
share its values, not only its customers.
For the infrastructures, in 2020, the company used 100% of renewable electricity in the
US and 76% in the world. Patagonia has offices, stores and distributions centered on
the world but the footprint of their own establishment represents only 3% of the global
supply chain footprint. Indeed, the huge majority of the production is created by locals
which the company is not proprietary, so it has less control than for its own locals. But
the company said that “they prefer to sweep in front of their own door before sweeping
in front of others’.”
Social impact: Workers: The Company has been seen for a long time as unusual and
one of the best work environments centered on culture. https://youtu.be/cnWw55rhIxs
Since 1984, Patagonia don’t used individual offices, and has a cafeteria with only
biological foods and beverages. It’s also at this time that the company opened the Great
Pacific Child Development Center, the first company’s day care. Patagonia has kept this
“enterprise culture”, the company invests more than $1 million every day for day care for
its collaborators. https://youtu.be/4gxhUbPp1yU
Also according to the web site glassdoor.fr, Patagonia is rated 4, 3/5 for its working
environment. This grade is based on data from 273 reviews written by employees. The
web site Moralscore.fr gives Patagonia a 65, which is the 2nd highest in the textile
industry, and a B grade for its salary and working condition.
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Social Impact: Civic Engagement & Giving: Patagonia works with many sportive
personalities who have influence and share their values with their community. It creates
communities around common passions such as climbing, skiing, running or surfing.
Then it tries to implicate people that have the same values to act: buy recyclable and
non-neoprene surf combinations, clean beaches and oceans for the surfing communities
for example. The company is also certified B Corporation. To be a B Corp, a company
must have an explicit social or environmental mission and a legally binding fiduciary
responsibility to take into account the interests of workers, the community and the
environment, in addition to its shareholders. To keep this B Corp certification, Patagonia
needs to refresh and has its qualifications verified every three years.
Environmental Impacts: Waste Reduction: The textile industry is currently an industry
of overproduction and overconsumption. In fact people buy 4 times more clothes than in
15 years, and keep it 2 times shorter. The first engagement of Patagonia is to create
solid clothes and equipment that people can keep for a long time. The company is also
engaged in the use of recycled materials for its products. In fact 68% of its raw materials
are made of recycled materials such as old clothes, fishing nets etc. It’s a strong figure
when we know that just 1% used clothes are recycled to new clothes. Another
engagement to reduce waste is its “Worn Wear” program which encourages and invites
people to repair their clothes. Several Worn Wear events are organized in the US.
There are 2 possibilities to repair your clothes: first, people come at the event and repair
clothes by themselves using the company equipment with the help of the staff. The
second option is to bring your clothes to the staff, and they will repair it for you. The
company also provides online guides to repair Patagonia’s (but also other) clothes. The
act of repairing your own clothes will save many resources necessary for the production
of new clothes.
Environmental Impacts: Resource Conservation: As we said just above, the
company uses recycled materials for the production of its products. By doing that, the
need for new materials is decreasing just as the resources that are needed in the
process of production of these new materials. (Produce cotton or other materials that
use water, electricity, gas etc.) Another action that can preserve our resources that we
saw above, is the repair of our damaged clothes instead of buying new. Patagonia has
the largest cloth repairing center of North America. The company is also able to be 76%
sustainable in electricity uses (100% for America) thanks to many solar panels on its
infrastructures.
Environmental Impacts: Carbon Footprint & Toxics Reduction: Patagonia is using a
process called mass dying for heavy products such as languages. Mass dying involves
adding pigments directly to the molten plastic solution before the fiber is made. This
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process saves up to 80% water and 63% CO2 in total, with considerably less release of
chemicals throughout the process. The company is also using synthetic dye that use
less water, chemicals and energy in their textile use, while producing premium color with
better performance.
By using recycled materials, Patagonia avoided the production of 20 000 tons of CO² in
one year. The production and the use of 100% biological cotton avoid the use of tons of
pesticide. Cotton’s culture is responsible for 25% of the global pesticides used in
agriculture.
Environmental Impacts: Product Development & Life Cycle: Patagonia is trying to
move to 100% recycled materials for its products. The company is using 2 types of
recycling:
- Post-consumer recycling: this includes anything people throw in the recycling bin at
home or in specific textile bins, as well as used fishing nets, carpets and other consumer
goods that can be recycled into textiles.
- Pre-consumer recycling: In the case of post-industrial cotton recycling, the recycled
yarn is sometimes mixed with other materials, such as polyester, to ensure that there is
no loss in performance.
- The company also table on process like chemical recycling. It can be used on materials
such as polyester and nylon to reduce them to the basic building block stage and
remove dyes and other pollutants. This process makes it possible to make synthetic
textiles which cannot be recycled otherwise. Even if it consumes more energy than a
mechanical process, it still allows environmental savings.
Environmental & Social Impact: Supply Chain & Procurement: Millions of
employees are underpaid in the textile industry. To fight this social issue, since 2014,
Patagonia produced Fair Trade certified products. The company has the largest range of
Fair Trade products in the textile industry. It’s a first step to tend to more fair
remuneration of its supply chain. For every Fair Trade certified product, the company
pays a bonus. This amount of money goes directly to workers from the factory that can
use this money freely. 66 laborers benefit from Fair Trade. About transport, to reduce its
footprint the company will increase the use of drop shipping (a way of moving directly
from factories to international distribution centers), which reduce the need for air
shipments and reduce the use of two-day delivery options for customers. In terms of
supply chain the company regularly visits the manufacturing facilities of current and
potential suppliers to see if they meet Patagonia's minimum requirements and best
practices for environmental performance.
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Recommendations
The main recommendation that I can provide, based on what I learned about the
company, its policy, its values, its engagements and its sustainability, I think that the
control that Patagonia has on its supply chain is too limited. The company possesses
none of the factories that produce clothes, and I think that could be a problem in the
future. Even if the company says that currently they prefer work on their own business
before looking for the others, I think that on a long-term vision this answer won’t be
viable. I will recommend Patagonia to invest and acquire the production facilities where
the clothes are produced, in aims to get much more control on its supply chain. We saw
that footprint of its own facilities represented only 3% of its global footprint. By doing that
the company could reduce the footprint of the production facilities using the same model
that they used for its actual own facilities. Also they will be able to improve the social
conditions of laborers in those facilities.
If I should establish a timeline for this project, I will say that, just as the company is doing
currently, continue to work on their actual sustainability to achieve the goal of 100%
sustainable electricity uses and 100% recycled materials for the products. Maintain their
implication for the local and global communities and also their work policy and
environment to fit with the values of the company and its creator. Once these goals
would be achieved, the company should make a long-term investment plan regarding
the viability of the project and their current financial capacity. Then they should
progressively purchase production facilities and suppliers companies that can handle
the demand for their products. After that, Patagonia will have a better control on his
operational processes and would be able to implement sustainable innovation and
processes just as they made for the past 40 years.
Said like that it sounds easy, but many factors should be had to the equation, especially
the financial viability of this project just as his profitability.
Conclusion:
Since its creation, Patagonia, a company made by and passionate of sport and nature,
understood the stacks of the environment. During many years and even today, the
company always tried to find new processes, techniques, methods that can improve the
sustainability of its operations. The company stoke its values and the values of its
creator to become a model in its industry in terms of sustainability, environmental and
social care. But as many in the industry of textile, the company uses really cheap labors
to be profitable and compete with the other companies of the industry.
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References and citations
Patagonia, un exemple en matière de culture d'entreprise
Pourquoi Patagonia Reste La Référence Des Entreprises Socialement Responsables |
Forbes France
La note éthique de Patagonia selon Moralscore, plateforme RSE : environnement et
social
Travailler chez Patagonia | Glassdoor.fr
https://eu.patagonia.com/fr/fr/home/
https://www.verif.com/comptes-annuels/PATAGONIA-EUROPE-341134757/
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