Supporting our suppliers through challenging times

Supporting our suppliers through challenging times

Early on in the pandemic, our customers adjusted to a new way of life and we saw a sudden shift in demand for certain clothing and general merchandise. For example, we saw less demand for suits and beach towels and more people buying active wear and gym equipment.

We recognised this change to shopping behaviour could have left us with too much stock for some items which we had placed orders for long before coronavirus. We were also aware that Sainsbury’s would not be the only business with suddenly different requirements and that this could create a very challenging time for our suppliers and their workers around the world.

Initially we invested time in contacting our suppliers individually to discuss the orders that we had placed in an effort to fully understand the situation and how we could best support them. This was a lengthy and complex process and allowed us to build a detailed picture of our suppliers’ situations.

Following these conversations, we agreed to receive the vast majority of the orders that we had originally committed to. In a small proportion of cases, this involved postponing production and covering any costs associated with this for our suppliers.

In the very small fraction of cases where we took the decision to cancel, we made sure this was in line with suppliers’ existing contract and terms. We also provided additional support which was tailored to suppliers’ individual circumstances and the challenges they were facing. This included but was by no means limited to:

• Paying for any product our suppliers had already produced specially for us
• For any orders they had started, agreeing they should finish that batch of product and we covered the cost for this
• Arranging for products to be shipped to our stores, helping to free up space in suppliers’ factories, which we understood could be limited from our conversations with suppliers
• Covering the cost of any fabric for Sainsbury’s products which had already been paid for

Keeping workers safe

Safety is our highest priority. As factories have started to reopen we have stayed in close contact with our suppliers to make sure we understand the challenges they are facing as they balance introducing new ways of working to keep everyone safe with securing the livelihoods of all their workers. These conversations include helping factories to prioritise the items they produce and making sure our suppliers are equipped to meet all appropriate safety guidelines.

We have shared with our suppliers government issued guidance, as well as some best practice. For example, we have hosted a series of webinars which give examples of safe ways of working during these unprecedented times. We invited suppliers to complete a questionnaire too, so that we could better understand their key concerns and respond on a case by case basis.

Our dedicated teams are also working hard to ensure that correct payments have been made to workers even where, in some instances, no work was carried out. We are following up with factories to confirm that these payments have been made.

The future for factories

Together with our suppliers we have cleared the first few hurdles of the pandemic, but we understand this could be just the beginning of a long and challenging journey back to business as usual for us, our customers and our suppliers.

We are working closely with our suppliers to provide maximum visibility of future commitments where we can, so that we can help our suppliers plan more effectively.

Recognising that the impact of coronavirus requires a collaborative industry response, we have endorsed the Call to Action in the Global Garment Industry. This means we are working alongside global institutions, NGOs, trade unions and businesses to generate action from across the global garment industry to protect workers’ income, health and employment and support employers to survive the crisis, as well as working together to establish sustainable systems of social protection for a more just and resilient garment industry.