Client: A large online German Retailer specializing in shoes, fashion, and beauty products
Location: Hong Kong
Ambition to: Net zero in its own operations and private labels by 2040, and net zero across the entire platform by 2050
Services: Hotspot Analysis | Emission Mapping | Roadmap Development | Supplier Engagement Strategy | Supplier Implementation Support
RESET first started working with this large online German retailer in 2021 and has since delivered multiple phases of work across the entire supply chain. Our Hong Kong team continues to support them on their decarbonization journey.
2021
In 2021 our Hong Kong team undertook a phased approach to develop a Supplier Engagement Roadmap for the large retailer. The retailer was keen to engage better with its suppliers in order to continuously drive, and monitor, suppliers’ carbon and water reductions.
The Challenge:
As part of its goal to tackle scope 3 emissions and reach net zero, the large retailer wanted to develop a decarbonization strategy for its private label products within the business. The retailer also wanted to explore what alternative materials and processes were available to reduce emissions in the supply chain.
The objectives of this engagement were to:
- Map the carbon emissions from its supply chain
- Identify its carbon hotspots and evaluate the different carbon reduction scenarios in order to achieve its 2025 commitments
- Develop a low carbon roadmap with tailored and specific recommendations for its sourcing strategy
- Identify collaboration opportunities and receive recommendations for its supplier engagement strategy
Our Approach:
Our approach involved three phases as follows:
Phase 1:
Supply chain carbon mapping, hotspot analysis and segmentation of emissions for reduction scenario modelling.
Phase 2:
- Mapping reduction potential for major opportunities
- Modelling of draft reduction scenarios for 2025
- Creating working groups for priority hotspots
Phase 3:
- Development of 3 reduction wedges (e.g., manufacturing, packaging, raw materials) and lead consultation sessions with working groups on the most appropriate reduction strategies
- Review of opportunities in collaboration with the supply chain
- Development of low carbon roadmap and recommendations for emissions tracking
The Outcome
The large retailer received a customized carbon reduction roadmap that pinpointed supply chain hotspots and prioritized actions. The roadmap provided clear next steps to achieve their 2025 targets, including actionable carbon reduction scenarios, collaboration opportunities, and practical strategies to engage suppliers and drive impactful reductions.
2022 onwards
In 2022 our Hong Kong team continued its engagement with the retail giant, this time moving onto the development of a Supplier Engagement Decarbonization Program (SEDP). This second stage was to support with supplier engagement and carry out the roadmap that had been developed in stage 1.
Objectives
- Design a program that allowed for efficient and effective engagement with supply chain partners
- Deliver measurable GHG emissions reductions with supply chain partners to support current and future climate goals
- Better understand the supply chain’s reduction potential and maturity levels
- Enhance the dialogue with suppliers on the action plans, with the intent to identify implementation barriers
Our Approach
To achieve the large retailer’s objectives, we customised the following approach:
- Developed a Supplier Engagement Decarbonization Program (SEDP) and piloted the approach with 15-25 textile and PU Leather facilities
- Developed standardised tools, leveraging onsite experience to deploy to broader manufacturing supply chain
- Undertook carbon and water reduction assessments on suppliers
- Set facility-level carbon and water base year emissions targets and developed low carbon action plans
- Provided monitoring support for suppliers
- Developed an efficient carbon tracking approach to capture supplier data more frequently
- Took learnings and tools into the official launch of the SEDP
The Outcome
The key outcomes to date are:
- Batch 1 on the SEDP included the top 12 most significant emitters and each site set a 2030 carbon target of an average of 55%
- 20 more sites in Batch 2 are currently engaging in the SEDP
What’s next
RESET Carbon remains actively engaged with the retailer focusing on the next phase: delivering a series of workshops to engage with the sourcing team to address their insights and concerns and co-create an impactful low-carbon sourcing process. In parallel, the implementation of supplier action plans will take place. Stay tuned for further updates.