Social Report January 2015 – December 2015
Kings Of Indigo www.kingsofindigo.com Start date membership July 2012 Reporting period (financial year) January 2015 – December 2015
Organisational chart
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Social Report January 2015 – December 2015
Contents
Summary: goals & achievements 2015 .............................................................................. 3 1.
2.
Sourcing strategy ........................................................................................................ 3 1.1.
Sourcing strategy & pricing ................................................................................. 3
1.2.
Organisation of the sourcing department ........................................................... 4
1.3.
Production cycle ................................................................................................. 4
1.4.
Supplier relations ................................................................................................ 4
1.5.
Integration monitoring activities and sourcing decisions .................................... 5
Coherent system for monitoring and remediation ....................................................... 5 2.1.
Interwashing/Tunisia ........................................................................................... 5
2.2.
Art Lab/Tunisia.................................................................................................... 5
2.3.
External production ............................................................................................. 5
3.
Complaints handling ................................................................................................... 6
4.
Training and capacity building .................................................................................... 6 4.1.
Activities to inform staff members ....................................................................... 6
4.2.
Activities to inform agents ................................................................................... 6
4.3.
Activities to inform manufacturers and workers .................................................. 6
5.
Information management ............................................................................................ 6
6.
Transparency & communication ................................................................................. 7
7.
Stakeholder Engagement ........................................................................................... 7
8.
Corporate Social Responsibility .................................................................................. 7
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Social Report January 2015 – December 2015
Summary: goals & achievements 2015 “More and more people are becoming aware of the fact that they can make a difference. That their small wave becomes a bigger wave, affecting other people, companies, national governments and in the end even international politics. We want to help to make those small waves bigger”. Tony Tonnaer, founder Kings of Indigo Goals & achievements in 2015: - One person is appointed in the team dedicated to the brand’s CSR (including the Fair Wear Foundation). - The entire supply chain is mapped out and Kings of Indigo knows each and every factory and its sub-contractor. - The stitching and washing facility in Tunisia and the (sole) factory in India are audited. -90% of the production volume comes from factories that are either audited or are based in low-risk countries such as Greece, Italy, Spain and Portugal. - A new factory in Turkey is being tested to work with. Once the supplier base is stable, the factory will also be audited. Sourcing strategy
1.1. Sourcing strategy & pricing The Kings of Indigo collection consists of forty-five men’s denims, forty-five women’s denims, thirty-five men’s tops and thirty-five women’s tops. Denim: Kings of Indigo selects the sustainable denim fabric from denim mills ORTA, TRC, Bossa, GAP, Royo and Collect. Recycled fabrics should meet the Global Recycling Standard and the organic fabrics should be GOTS certified. All Kings of Indigo denim is produced in one factory in Tunisia. Laundry is done in Tunisia and at two laundries in Italy, keeping production close to home. Made in the Mediterranean. A challenge this year was working with a solid stitching partner. Though the brand prefers not to switch factories, there was an urgent need to move from Carthago to ArtLab. This decision was taken under careful consideration and with the intention to stay with this new platform for years to come. Apparel: For the apparel, the brand is moving closer to home. Production in the FWF audited factory, Bhartiya in India is scaled down. The brand is looking to move more production to factories in low risk countries such as Spain, Greece, Portugal and Italy. The country where Kings of Indigo will be growing in terms of sourcing, which is considered to be a high-risk country, is Turkey. We will put extra focus on this country this coming year. Pricing of the garments is cost price up; resulting in cost prices from 18-50 euros FOB. Kings of Indigo should make at least 53% gross margin and gives a mark up of 2,5 to its retailers. This results in RRP from 99,95 – 299,95 euro for a pair of Kings of Indigo jeans.
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Social Report January 2015 – December 2015
1.2. Organisation of the sourcing department Denim Bart-Jan Opten takes care of the sourcing and production of the denim collection. ArtLab produces Kings of Indigo products in their factory Nice One, the washing is done at Interwashing and Elleti. Apparel Kirsten Zwart takes care of the apparel collection, working closely with Khoi Thai on design.
1.3. Production cycle Kings of Indigo produces two collections per year (spring/summer and autumn/winter). The production cycle in short: - A range plan is made based on the turnover targets for that specific season. - Based on this range plan designs are made by an external Dutch patternmaker. - With these patterns the first prototypes are produced. - Prototypes are then fitted and corrected until they are fit to be sales samples. - Sales samples are distributed to all agents in the Netherlands, Germany, Austria, Sweden, Denmark, Belgium, Switzerland, UK, Canada and France, Norway. - The agents sell the collection to retailers with the samples as an example. - When all orders are collected purchase orders are placed at the factories with an agreed price and delivery date. - The carryover fabrics are defined and new sustainable fabrics are selected and send to the factory and laundry to test. - Based on the outcome of these tests the final fabrics are chosen and allocated to the styles and washes. - Shrinkage and quality tests are then done on all fabrics, so the patterns can be altered if needed. - When all sales orders are in, production orders are placed. - Kings of Indigo visits the factories on a regular base, working closely together in order to achieve the best result.
1.4. Supplier relations Tony Tonnaer, the founder, has many years of sourcing experience with Ethics, Pepe Jeans, Ubi Jeans and Kuyichi. This has resulted in an extensive supplier network that is the base for current Kings of Indigo suppliers. Kings of Indigo aims to work with factories that are close to home (Europe). The actual factories are visited on a regular base, not just the offices.
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Social Report January 2015 – December 2015 Suppliers have to meet the Kings of Indigo standards. This means they (preferably) have a social and/or environmental certification, or have a strong base to receive one in cooperation with Kings of Indigo. Varova Fashion Holding is the holding company for Kings of Indigo, Ontour, G-sus, Tumble ‘n Dry, Sissy Boy, Men At Work and Open32. VFH is in the process of becoming a BSCI-member on behalf of all the companies within the holding.
1.5. Integration monitoring activities and sourcing decisions Aside from the use of sustainable fabrics, good working conditions for the people who produce the products are important. Kings of Indigo chooses only to work with factories that have the same standards, and preferably a certification to prove it. If there is not yet a certification, they should have a strong base to get one in cooperation with Kings of Indigo. The new factories that are selected are based in low risk countries in Europe. Working close to home gives Kings of Indigo the opportunity to visit the factories more frequently and keep an eye on the standard. Our production in India, at FWF audited factory Bhartiya, is scaled down. Varova Fashion Holding is the holding company for Kings of Indigo, Ontour, Gsus, Tumble ‘n Dry, Sissy Boy, Men At Work and Open32. VFH is in the process of becoming a BSCI-member on behalf of all the companies within the holding.
2. Coherent system for monitoring and remediation 2.1. Interwashing/Tunisia This facility has had a verification audit by the Fair Wear Foundation. During the audit, the team noticed many improvements. The majority of the workers earn more than the living wage. In periods of seasonal peaks however there is some overtime registered. How to reduce these hours is being discussed with the factory.
2.2. Art Lab/Tunisia The Fair Wear Foundation has audited this facility since this will be the main supplier for the garments (mainly denims). The CAP (Corrective Action Plan) is discussed in order to solve issues. The majority of the workers earn more than the living wage. In periods of seasonal peaks however there is some overtime registered. How to reduce these hours is being discussed with the factory.
2.3. Bhartiya/India The Fair Wear Foundation has audited this facility because it is situated in a high-risk country. The CAP is discussed with Bhartiya in order to improve. The wage average is at par legal minimum wage. The workers do not have a CBA (Collective Bargaining Agreement). The implementation of the CBA is being discussed with the factory.
2.4. External production This is not applicable for Kings of Indigo
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Social Report January 2015 – December 2015
3. Complaints handling No complaint has been submitted last year. If a complaint from a worker would come in, Kings of Indigo would follow up immediately. Each production facility is asked to post the Code of Labour Practices (CoLP) on a place that is visible and has easy access for the workers. Furthermore, workers are being educated to become more aware of their rights.
4. Training and capacity building 4.1. Activities to inform staff members Each person within the Kings of Indigo team is aware of the FWF membership and its requirements. New employees are informed about FWF and research material is shared via the internal server.
4.2. Activities to inform agents Agents are very involved in the communication process between Kings of Indigo and the factories we produce at. The fact that Kings of Indigo aims to produce as fair as possible is one of the reasons to start collaborating in the first place.
4.3. Activities to inform manufacturers and workers In 2015 we have mapped the entire supply chain is mapped out. Kings of Indigo knows each and every factory and its sub-contractor. Our facilities in Tunisia and India are audited. Kings of Indigo also produces in Greece, Italy and Spain and just started producing in Portugal. Every factory is asked to read and sign the FWF questionnaire and post the CoLP. All production facilities are asked to post the CoLP in a place that is visible and has easy access for the workers. Also, the workers in the audited factories are educated to become more aware of their rights.
5. Information management Kings of Indigo has set up an easy to use but thorough monitoring and improvement plan with each supplier. This monitoring system consists of an agreement on the following points: -
The CAP is discussed and clarified with notes and pictures (on site or from documents).
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Repeated evaluations take place on what needs to be improved (during each visit these points are to be discussed and evaluated with the appointed person).
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Each member of the sourcing and production team is aware of all agreements; the dedicated CSR person is responsible for actual improvement.
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Before each trip is made to the factories, this CSR person highlights the points of improvement.
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Before each trip, an email is sent to the specific factory to give them the opportunity to prepare.
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Social Report January 2015 – December 2015 -
The list of improvements can be shortened with each trip.
6. Transparency & communication Founder Tony Tonnaer gives lectures at colleges, universities, seminars, etc. on a regular base. He will name the Fair Wear Foundation as a partner in developing our fair working conditions in the factories we work with. Also in our media approach we clearly state the fact that sustainable production and the fair labour conditions are priority for the brand and something we are constantly striving to develop and improve. On the Kings of Indigo website in depth information about our way of working and production processes can be found.
7. Stakeholder Engagement Factories The FWF country study on Tunisia and the FWF risk assessment for Italy has been used for a better understanding of issues and the proper approach to solving them. Sales agents Tony Tonnaer and our agents give at least ten retail training sessions per season, where shop staff is educated on the Kings of Indigo ID, the sustainable philosophy and social engagement.
8. Corporate Social Responsibility Kings of Indigo produces all garments with as much use of sustainable materials as possible. This concerns not only the garment itself but also materials for labels, packaging, POS material and even office supplies. Kings of Indigo introduced a triple-R philosophy promoting Recycling, Repairing and Reusing garments by gifting branded repair kits, producing with recycled materials and organizing repair events in stores to help consumers enjoy their garment longer.
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