Transforming Africa’s fashion industry with lean supply chain management
An sup 02
powe in
ethical pply chain werhouse Africa WRIT TEN BY
L AUR A MULL AN PRODUCED BY
S TUART IRVING
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One of Australia’s largest retailers, Cotton On Group, is making waves in the African fashion industry with its lean, ethical supply chain
I
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n 1988, 18-year-old Nigel
With over 15 years in the supply
Austin sold his first acid
chain field, Phil Marais, Head of
washed denim jacket in
Africa and Brazil Supply Chain at
Geelong, Australia. It would be this
Cotton On Group, has been the
sale that would sow the seed for
ideal candidate to make this vision
fashion powerhouse Cotton On
a reality. He points out how Cotton
Group which, within 25 short years,
On Group has hired people with
has grown to become Australia’s
boots on the ground so that the
largest global value fashion retailer,
retailer can gain a true understand-
with seven brands, over 1,400 stores,
ing of these regional markets and
and a footprint spanning 17 countries.
their supply chain ecosystems.
From Australia to the UAE, Brazil
“For our regional markets, like South
to Singapore, Cotton On Group has
Africa, for example, the value of our
mushroomed in size over this short
assets and individuals is critical,” he
timeline, but one continent has clearly
explains. “It helps provide context to
been pivotal to its success – Africa.
our team members so that we can
Home to seven of the fastest growing
execute the supply chain in that
countries in the world, Africa has
market, whether it’s in South Africa
quickly emerged as a force to be
or Sao Paolo, to the best of our ability
reckoned with in the fashion industry.
with that local knowledge. Aligning
Recognising this, Cotton On Group
with the group framework whilst
has kept a keen eye on the fast-
adding that local twist is really
emerging scene, opening almost 170
important. Emerging markets like
stores in South Africa, six in Namibia,
Africa and Brazil present huge
with additional sites in the pipeline.
growth opportunities for the group.”
“ In today’s social media dominated world, we know that we’ve got to have influencers in our corner.We have to tap into what we think is going to be fashion forward and value-based” — Phil Marais, Head of Africa and Brazil Supply Chain at Cotton On Group
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E X E C U T I V E P R OF IL E
Phil Marais On the journey to currently being the Head of Africa and Brazil Supply Chain, Phil has had experience at multinational apparel and furniture entities. These opportunities have been based in both Johannesburg and Singapore, overseeing multi-channel operations both locally, Sao Paulo and in South East Asia for Cotton On. Having a strong people focussed approach in South Africa has benefited in adapting to relationship building, internationally, across language and cultural barriers.
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“ Aligning with the group framework whilst adding that local twist is really important” — Phil Marais, Head of Africa and Brazil Supply Chain at Cotton On Group
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07 The fashion industry is notoriously
chain team but it’s one which Marais
fast-paced, with new trends flying past
believes the company is more than
today’s window displays in the blink of
prepared to meet.
an eye. “In today’s social media dominat-
“In our industry, speed is key,” he
ed world, we know that we’ve got to
observes, “We need to have the stock
have influencers in our corner. We have
delivered at the right time and it needs
to tap into what we think is going to
to be accurate so that when a custom-
be fashion forward and value-based.
er walks through our doors they have
It’s an exciting part of the business,”
a positive experience. We’re a fast
Marais says. Priding itself on this
fashion business that relies on speedy
fashion-forward, value-based approach,
replenishment of stock. Therefore,
Cotton On Group aims to be one step
if you’re doing anything that’s making
ahead of its peers, meaning time is of
you slower, you’re doing it wrong. This
the essence. This has undoubtedly
means if a t-shirt sells out in store and
created a key challenge for its supply
a customer returns tomorrow, the stock w w w.c o t to no n. com . a u
needs to be available so that they won’t have to wade through a pile of sizes or visit other stores to find their size.” With a few clicks of a button, the rise of e-commerce has also helped strengthen the need for swift delivery but it has also added a new dimension for supply chain professionals to tackle. In January, Cotton On Group launched its online store platform and loyalty card for its South African operations. This has upped the company’s sales and 08
the volume of products that need to be delivered. “What was good yesterday, is average today and probably won’t be good enough tomorrow,” reflects Marais. “Therefore, we need to be agile and adapt our model so that consumers can buy what they want, how and when they want to. Even in mature markets, we’ve been quite a big player in the e-commerce market. Now, we’ve launched our online operation in South Africa, we’ve seen a really nice uptake in volume through this channel of the business. We’ve also started a new wholesale channel with an online marketplace that stocks
CLICK TO WATCH : ‘THE COTTON ON GROUP: WHO WE ARE’ 09 our brands which provides another channel for us to be able to offer our product.” Relying primarily on word of mouth, rather than advertising and delivering a positive customer experience, is the bread and butter of Cotton On Group’s success. As a result, getting thorough feedback has been critical “We’re engaging with our team and finding out what customers are saying through online feedback,” Marais says. “We’re learning from this feedback and I think that speaks to the company’s entrepreneurial spirit. We’ve got very inspirational leaders who really help drive us to be quicker and faster in unique ways.” w w w.c o t to no n. com . a u
Drawing from its experience in the Australian market, Cotton On Group has replicated its e-commerce and supply chain solutions for the past several years in different markets. This has meant it could be smoothly adopted in regional markets in Africa. Marais points out how the company’s South African distribution centres are efficient and lean to make orders easier to tackle. “Our distribution centres are set up to complete our online orders internally which made the execution of online a lot easier to manage,” Marais notes.
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“We’ve also got an online platform that has been tested in Australia but which has been adapted to our local
1,400 + stores
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countries
market. This has meant that we have been able to quickly deliver that customer experience that people have come to expect from Cotton On. “It’s supply chain 101: if you add complexity it slows down the operation,” he adds. “So, we’ve managed to keep our business relatively simple. It allows us to be agile when adapting our strategy to meet the
20,000 + employees
demands of e-commerce, for example.” With plans to expand to Botswana over the coming months, it’s no question that Cotton On group has fine-tuned its strategy
“ It’s supply chain 101: if you add complexity it slows down the operation” — Phil Marais, Head of Africa and Brazil Supply Chain at Cotton On Group
for success. Yet Marais is keen to point out that this wouldn’t be possible without a team that was entrepreneurial, curious and up for a challenge. “I have experience in various warehouses in South Africa, but when I started my own journey at Cotton On I quickly realised that if you’re passionate about supply chain and want to grow your career, then the place to do that is Cotton On,” Marais says proudly. “You can see an entrepreneurial spirit in our business every day. We’re led by people who expect us to take ownership of our function and execute it to the best of our ability.
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It’s also about having fun, engaging with your team and really connecting with them.� Not only does the company foster the talents of its own people, but it’s also helping to enrich the lives of local communities across the globe. Today, cotton is one of the most commonly used natural fibres in the world with more than 25mn tonnes produced every year. As a business, Cotton On Group has set itself an ambitious goal to have 12
100% sustainable cotton throughout its supply chain by 2021. To achieve this it has developed a unique partnership with the Better Cotton Initiative and has launched its very first sustainable cotton program in Kwale County, Kenya, known as Kwale Cotton. Through the program, Cotton On Group works closely with farmers in Kwale to help them transition from subsistence farming to more sustainable cotton farming practices. In addition to funding the training and setup of each farm, the Group is committed to purchasing 100% of the cotton lint,
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“ It’s also about having fun, engaging with your team and really connecting with them” — Phil Marais, Head of Africa and Brazil Supply Chain at Cotton On Group
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“ In our industry, speed is key” — Phil Marais, Head of Africa and Brazil Supply Chain at Cotton On Group
15 which is of a premium grade. Since
Marais concludes. “To know that by
the project began in 2014, over 1,500
following your career aspiration at
farmers involved, with many of those
Cotton On, by enabling our customers
doubling their income since coming
to have a really great shopping
on board.
experience, kids will hopefully get to
Additionally, thanks to the group’s philanthropic arm - the Cotton On
go to school, learn new skills and feel empowered – is an amazing feeling.”
Foundation - the retailer is also helping to empower people through health, education sustainability and infrastructure. “We are opening schools in Uganda, Australia, Thailand, and South Africa, and have set ourselves a goal of creating 20 000 educational places by 2020” w w w.c o t to no n. com . a u
Suite 1, Loft Offices The Zone@rosebank 31 Tyrwhitt Avenue, Rosebank, Johannesburg, 2196 T +27 800 988 824 reception@cottonon.com.au www.cottonon.com.au