Category: Retail and apparel
Summing up: Using the power of a global and successful brand, Puma aims to use its position to elevate the social and sustainability performance of its suppliers.
What the judges said: “A lot of buyers can offer a best-practice approach, but only a few are innovative and inspirational.”
- With an innovative approach to pricing, Puma used environmental, health and safety, and social parameters to help set SCF pricing for suppliers
- The programme available to all international suppliers
- Implementation was carried out by sourcing teams with additional support provided by treasury
- Fifteen percent of suppliers have been on-boarded
- The programme currently provides $10m-20m of finance with more than $100m worth of receivables having already gone through the programme.
Puma, the International Finance Corporation, part of the World Bank, and BNP Paribas have come together to provide financing to all of Puma’s suppliers across the globe. As the majority of suppliers are based in Asia, particular emphasis is placed on those in emerging Asian economies, including Bangladesh, Cambodia, China, Indonesia, Pakistan and Vietnam.
The Puma Vendor Financing Programme (PVFP) is supported by technology from GT Nexus.
PVFP puts in place a tiered pricing structure that offers lower finance costs to suppliers who rate highly on Puma’s supplier rating system. The programme uses ratings based on Puma’s own standards and will be monitored through an auditing process. The financial incentives will raise environmental and social standards across Puma’s supplier base.
“This financing programme enables our suppliers to leverage their relationship with us and benefit from Puma’s strong reputation and financial position,” said Lars Soerensen, Puma’s chief operating officer. “This is the first programme in our company that rewards a supplier’s rating within Puma’s environmental and sustainability programme through related fees.”
One supplier, Ken Hong, general manager of Ball Planet Industrial In Hong Kong, said: “We are keen to start using this financing facility, since access to affordable financing is always a challenge. This innovative programme will not only help us improve our cash flow, but will also provide us with a financial incentive to improve our environmental, health and safety and social standards, which will ultimately reduce our operating costs and enhance our performance.” Ball Planet has been a business partner of Puma since 2010.