Lotus: A Sourcing Guide

Table of Contents i. about us

xii. supplier analysis

ii. our mission

xiii. supplier ranking

iii. our values

xiv. strategy conclusion

iv. our vision

xv. internal monitors

v. company overview

xvi. external monitors

vi. target market

xvii. line plan

vii. customer profiles

xviii. unit breakdown

viii. code of conduct

xix. cost sheet

ix. country analysis

xx. tech packs

x. strategy publication

xxi. conclusion

xi. country ranking

xxii. works cited

About Us

CEO Vice President Design Director Marketing Director

Taylor Jackson Alejandra Crespo Daniela Gonsalves Kelly Hippenmeyer

Our Mission

Lotus aims to provide lingerie that is fulfilling and satisfying to every woman. We ensure our products are eco friendly and made with the utmost quality.

Our Values

The purpose of Lotus is to empower women to love their bodies and celebrate the beauty of diversity. Lotus aims to make comfortable and flattering undergarments that women will buy to pamper themselves.

Our Vision

Lotus sees itself as being the forefront of eco friendly lingerie. We believe every woman deserves to feel free in their own skin and have undergarments that flatter their body.

Company Overview OUR PRODUCTS Lotus provides customers with exceptionally constructed lingerie, where the focus is on the comfortability of the woman who will be wearing it. We limit our assortment to simple plain colors. We offer three styles of bras, two styles of panties as well as our staple robe. We focus on high quality lingerie made with fair labor practices and environmentally friendly resources.

LOGISTICS Because we believe in protecting the environment, Lotus is solely an e-commerce brand, which allows us to minimize our carbon emissions and allows us to operate in the least harmful way possible. Our quality underwear is produced in simple designs and plain colors to clarify our conviction of quality over quantity.

The boxes in which garments are shipped are made of recycled materials. One of our main objectives is to be transparent with our consumers therefore in the description of all garments we will provide customers with details of how the garment was sourced and the ethical procedures of the manufacturing.

Target Market Gender: female Location: urban areas Age: 18-39 Status: single Income Level: moderate to high Education Level: bachelor's degree Values: humanitarian and eco conscious Characteristics: sophisticated modern responsible Personal style: feminine classy comfortable Shopping preferences: willing to spend extra money for high-quality, environmentally conscious products

Alexis

Age: 33 Education: BS in Business at University of Pennsylvania Occupation: Global Sales Manager at LexisNexis •Excercises (but only after her morning 2 cups of coffee!)

•Recylces & uses environmentally friendly items in her home •Religious reader of Kinfolk Magazine •Doesn’t mind spending more on ecofriendly items

Sophia Age: 21 Education: BS in Business at University of Chicago •Is on a raw diet & excercises regularly •Meditates every morning •Her shopping choices are dictated by her concerns with protecting the environment and workers rights •Her days a are busy so she prefers the convenience of shopping online

Code of Conduct NO DISCRIMINATION POLICY -Discrimination based on race, religion, age, disability, sexual orientation, or gender will not be tolerated NO CHILD LABOR -Children under the age of15 shall not be employed to work in our facilities WORKING HOURS -Overtime shall be voluntary and compensated -Employees shall not exceed 48 hours of work unless allowed by country -At least one day off permitted every seven days -Fair Wages -Wages shall be enough to meet basic needs -Paid in a timely manner -Overtime shall be compensated 1.5 times the regular hourly rate -Deductions from wages as penalty are not permitted

HEALTH AND SAFETY ISSUES -Factories shall provide a safe and healthy working -environment to prevent illness, accidents or any damage -Employees should have access to hygienic toilet facilities -Employers should provide access to potable water, fire safety and adequate ventilation and lighting NO HARASSMENT POLICY -Employees shall not be object to any form of physical, sexual, or psychological abuse -Employees will be treated with dignity and respect

Country Analysis

INDIA has the second largest textile manufacturing capacity globally and houses the second largest apparel sector for employment in the country. Overall at the end of 2015 India employed nearly 51 million people directly and 68 million people indirectly. There is no standard minimum wage across India but the wage averages at about $1 an hour.

At the end of 2014 India was considered the 2nd largest producer of silk with 29 million kilograms in production and they are one of the main producers of wool with 48 million kilograms produced annually. India’s export volume to the U.S. last year was $3.2 billion which made up 4% of their total export for the year. The key apparel and textiles that were exported to the United States were cotton woven knits, silk, poly knits and man-made fibers and filaments.

India does not have any trade agreements with the U.S. and has no plans of implementing a trade agreement.

Chennai, India - Los Angeles, California Time:16-41 Days Cost: $5,848

Country Analysis

MEXICO is the 1st Latin American supplier of apparel products to the U.S. and the 5th worldwide exporter after China, Vietnam, Indonesia and Bangladesh.

Mexico’s textile and apparel industries account for 4.7% of Mexico’s manufacturing GDP (textiles 1.3%, apparel 2.5%). Both sectors account for nearly 20% of all manufacturing employment in Mexico. The largest segment of the Mexican market is centered in Guadalajara, Monterrey, and above all Mexico City, where luxury brands have a greater presence than in other states.

Mexico is the United States’ 3rd largest trading partner and the 2nd destination of all U.S. exports.

Mexico accounts for roughly 1/6 of all U.S. exports and an average of $6.2 million dollars of apparel and textiles are exported to the U.S. As of 2016 there are 22 states that rely on Mexico as either their first or second choice for exports.

In1994, Mexico’s trade with the US has almost tripled Due to its trade and financial links with the US, Mexico’s economy is sensitive to the US economic cycles. The fluctuations in Mexico’s output has become synchronized with those of the US economy since the country joined NAFTA in the 1990s. Three key links to the US economy are through trade, remittance inflows and financial markets.

Heroica, Veracruz to Los Angeles, California Time: 28-31 days Cost: $2,908

Country Analysis

SRI LANKA and the U.S signed a TIFA (Trade and Investment Framework Agreement) in 2002 which allowed more interaction between both businesses, and the strengthening of economically and environmentally conscious manufacturing processes. Sri Lankan apparel manufacturers are globally known for producing high quality fashion that is both ethical and environmentally made.

Apparel and textiles account for 40% of total exports Main product category is lingerie and swimwear but also includes sportswear and loungewear, export volume to U.S. is $2.37 billion.

Colombo, Sri Lanka to Los Angeles, California Time:13-54 days Cost: $1,476

Strategy Publication We selected Mexico, India, and Sri Lanka as our sourcing countries because all three countries possess qualities that are beneficial to our brand.

INDIA houses the second largest manufacturing sector in the textile and garment industry and they are a main producer of silk and polyester. Because of their easy access to these materials they are a great fit for Lotus.

MEXICO has a free trade agreement with the U.S. and Mexico accounts for roughly1/6 of all U.S. exports.

Because of its convenient location and already established trading policies, Mexico is an obvious choice for Lotus.

SRI LANKA not only has several lingerie manufacturing firms but the majority of these manufacturers strive to be environmentally friendly while producing quality garments. Because of Sri Lanka’s fair practices and lingerie manufacturing it is a wonderful choice for Lotus.

Country Ranking India Government Location Business Climate Textile Industry Costs Trade Agreements Economics Social Stability Sourcing Guidelines Trained Workforce Risks TOTAL

Mexico

Sri Lanka

Supplier Analysis INDIA

SRI LANKA

Ajay Murty Modes A 4 17 Old Rajinder Nagar New Delhi, India 110060 Products: Silk, Polyester +91 011-20576013

Mas Intimates 7th Lane off Borupana Rd. Kandawala Estate Ratmalana, Sri Lanka Products: Lingerie +94 11-4207300

MEXICO Industrias Macys Sa De Cv Victoria, Alce Blanco, 53370 Naucalpan de Juárez, Méx., Mexico Products Bra Tops +52 5 709 7620

Intima 45/11 Modarawila Industrial Estate Pandura, Sri Lanka Products: Lingerie +94 38-5674674

Ajay Murty Modes -This company is located in New Delhi, India and we chose them because they are main producers of silk and polyester. We are using silk in several of our products so this manufacturer would be great and less time consuming to work with because they already have most of the raw materials. We will be using silk in the robes and lingerie and using polyester in our two piece pajamas.

Industrias Macys Sa De Cv Victoria -We are working with this manufacturer mainly because they are very experienced in creating bra tops. They have created several types of lingerie tops and sports bras in several different patterns and fabrics. and they would ensure we’re getting quality products at a reasonable price.

Intima Lingerie -This is one of the best manufacturers for undergarments because they specialize in lingerie. They also manufacture lingerie for Victoria’s Secret which means they are able to create quality products.

Mas Intimates -We chose this manufacturer because they also specialize in lingerie and are very environmentally friendly..

One of their main clients is also Victoria’s Secret and they are located relatively close to the shipping ports.

Supplier Ranking Ajay Murty Modes

Capabilities Abilities Sourcing Guidelines Quality Lead Time Services Strategic Outlook TOTAL

Industrias Macy’s Sa De Cv

Mas Intimates

Intima

Strategy Conclusion COUNTRIES These three countries were selected for various conveniences that fit Lotus’ needs. Mexico was chosen because of the free trade agreement and close location. India on the other hand was selected for being the second largest producer of silk in the world.

Finally, Sri Lanka, was chosen for its ethic working conditions and because their main apparel production is lingerie and swimwear.

SUPPLIERS The suppliers that best matched our requirements where Intima, Mas Intimates and Ajay Murty Mode.

Intima and Mas Intimates were chosen because of their quality client portfolio in addition to their specialization in lingerie. Ajay Murty Mode was selected because of their experience, knowledge and expertise of manufacturing silk.

Internal Monitors Lotus monitors are based on our mission; in our supply chain we promote and sustain fair labor practices, safe working conditions and environmental responsibility.

Lotus will use environmentally friendly materials whenever possible and will monitor raw-material suppliers to verify they follow environmentally friendly production practices.

Permanent regulators in the factories will report to us and ensure the health of the workers by ensuring that silk workers are provided with the adequate protective equipment such as facemasks, first aid facilities, gloves and proper uniforms.

Silk marks (verified pure silk) will be required in order to ensure the protection of consumers and workers. Silk marks are provided and supported by the Bureau of Indian Standards and tested by their eco parameters.

Record and ensure that minimum wages of each country are fulfilled. We support factories to sustain such wages with the aim of helping workers achieve a higher living standard. With a permanent regulator and random interview process we will make sure that these guidelines are followed.

We will promote fair labor and environmentally friendly conditions in factories by abstaining from: negotiating for unreasonably low prices, demanding short lead times, making late fabric deliveries or last-minute design changes. This will be achieved by putting orders in within a timely manner and meeting standards for required colors and sizes of each prototype before the whole production is completed.

External Monitors Members of the Fair Labor Association provide us with an objective third party perspective that will allow for assessment of what is being faithfully practiced ethically and where there is room for improvement.

FLA does random visits to the factories to evaluate that safe working conditions are appropriated. Their reports of these visits are posted on their website.

FLA also audits our Social and Environmental Responsibility at our headquarters. This will help show how we are monitoring our compliance with the FLA’s Principles of Fair Labor and Responsible Sourcing following their workplace code of conduct. This will be reported annually.

Principles of fair labor and responsible sourcing apply to all our suppliers without exception. Our suppliers must meet workplace standards, train specific staff responsible for implementing workplace standards by region, train supplier workforce, ensure workers have reporting channels of which at least one is confidential. We will then analyze reports of workplace standards to check for areas that need improvement and we will work with suppliers to remediate in a timely and preventative manner.

Line Plan

Unit Breakdown

11% 11%

Cost Sheets

Triangle Bra

Soft Cup Bra

Sporty Bra

Robe

Cost Sheets

Brief

Thong

Advisory Specs Triangle Bra

Soft Cup

Sporty Bra

Robe

Advisory Specs Brief

Thong

Tech Packs Triangle Bra Style

Sizes

Womens underwear/bra

XS-L

Description

Factory

Silk bra with lacing on breast

Ajay Murty Modes

Sketch

Colors Black Blush Pink Champagne

Tech Packs Soft Cup Bra Style

Sizes

Womens underwear/bra

XS-L

Description

Factory

Silk bralette with lace on sides

Ajay Murty Modes

Sketch

Colors Black Cloud Gray Blush Pink Champagne

Tech Packs Sporty Bra Style

Sizes

Womens underwear/bra

XS-L

Description

Factory

Silk/polyester sports bra

Industrias Macy’s

Sketch

Colors Black Cloud Gray Blush Pink

Tech Packs Robe Style

Sizes

Womens loungewear

XS-L

Description

Factory

Silk robe with silk tie belt

Mas Intimates

Sketch

Colors Black Cloud Gray Champagne

Tech Packs Brief Style

Sizes

Womens underwear/panty

XS-L

Description

Factory

Silk panties with lace on side

Mas Intimates

Sketch

Colors Black Blush Pink Champagne

Tech Packs Thong Style

Sizes

Womens underwear/panty

XS-L

Description

Factory

Silk high waisted thong

Intima

Sketch

Colors Black Cloud Gray Blush Pink Champagne

Conclusion From aesthetic to production we aim to be ethical in everything we do. This is why we have taken the time to carefully select countries and suppliers that reflect our core values as a company. We strive to be the most empowering and comfortable lingerie company that exists to produce underwear that is well made, fitted, and stylish. Life’s too short for underwear that isn’t made with you mind!

Works Cited Co., D. T. (n.d.). Silk Fabrics. Retrieved March 08, 2017, from http://www.dharmatrading.com/fabric/silk/silk-fabrics.html Doing Business in India: 20 Cultural Norms You Need to Know. (n.d.).

Retrieved March 08, 2017, from http://www.comparebusinessproducts.com/fyi/doing-business-in-india Hippenmeyer, K. (2017, February). Sri Lanka: Apparel & Textile Industry.

Retrieved from https://elearning.scad.edu/courses/1/FASM-420-01-20824.201720/db/_ 3356994_1/SriLanka.pdf Katherine Doherty. "Mexico Is the New China." RVCF Link. Yusen Logistics, n.d. Web. 23 Feb. 2017.

LP, S. (n.d.). Reference guide. Retrieved March 08, 2017, from https://www.searates.com/reference Plather, M. (2017, February). Mexico Country Report. Retrieved from https://elearning.scad.edu/courses/1/FASM-420-01-20824.201720/db/_ 3358615_1/Country-Report.pdf Sanda, A. (2017, February). India Country Report. Retrieved from https://elearning.scad.edu/courses/1/FASM-420-01-20824.201720/db/_ 3356989_1/India_CountryReport.pdf WGSN | Create Tomorrow | Trend Forecasting & Analytics. (n.d.).

Retrieved March 08, 2017, from http://www.wgsn.com/

Alejandra Crespo Daniela Gonsalves Kelly Hippenmeyer Taylor Jackson