Supply Chain Transparency as a Consumer or Corporate Tool: The Case of Nudie Jeans Co

Abstract

Outsourcing has led both to the embedding of questionable sustainability practices in opaque supply chains and to anti-sweatshop challenges demanding more transparent supply chains. Previous research has argued that supply chain transparency can be both a consumer tool empowering consumers to pressure disclosing firms to improve sustainability conditions and a corporate tool for increasing revenues. Based on a study of the transparency project of Swedish company Nudie Jeans, the authors demonstrate that consumers do not leverage transparency but that transparency improves consumer willingness to buy. In doing this, the authors contribute to the literature in two important ways. First, the authors provide one of the first, if not the first, studies of whether consumers in practice leverage increased supply chain transparency, challenging the previous research claim that supply chain transparency is a useful consumer tool. Second, the authors move beyond studies of purchasing intentions and willingness to buy in experimental settings and confirm that supply chain transparency is a useful corporate tool in practice. The authors conclude by discussing the policy implications of companies being able to use transparency to increase sales without subjecting themselves to increased consumer pressure.

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Notes

  1. 1.

    The term “stakeholders” is used in this paper to refer to multiple actors such as consumers, governments, NGOs, labour unions, investors, media, and employees.

  2. 2.

    “Transparency” can roughly be defined as the disclosure of information (Doorey 2011; Mol 2014); “supply chain transparency” can therefore be defined as the disclosure of supplier names and information about sustainability conditions at suppliers (see the section “Supply chain transparency” for a detailed discussion of this matter).

  3. 3.

    Previous research clearly shows that increased pressure alone will not ensure supplier compliance (e.g., Locke et al. 2007; Egels-Zandén and Merk 2014). Still, increased pressure is likely to be, at least partly, related to increased compliance (Egels-Zandén 2014).

  4. 4.

    There is, of course, also the possibility that supply chain transparency could lead to improvements through self-discipline on the part of firms (Doorey 2011).

  5. 5.

    In this paper, the term “pressure” is used to denote any instances in which a consumer questions or criticizes the disclosing firm, i.e., simply asking for more information or clarification is classified as “pressure” in this paper.

  6. 6.

    It is worth noting that studies focusing on food traceability for some reason seem to find more negative results in terms of consumers’ not being particularly interested (e.g., Kuchler et al. 2010).

  7. 7.

    Convertible countries are those countries to which Nudie ships products, i.e., countries where website traffic can be converted into purchases. Most visitors to Nudie’s website come from convertible countries.

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Acknowledgments

This research was funded by the Swedish Retail and Wholesale Development Council (first author) and the Swedish Research Council (second author).

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Correspondence to Niklas Egels-Zandén.

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Egels-Zandén, N., Hansson, N. Supply Chain Transparency as a Consumer or Corporate Tool: The Case of Nudie Jeans Co. J Consum Policy 39, 377–395 (2016). https://doi.org/10.1007/s10603-015-9283-7

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Keywords

  • Consumer willingness to buy
  • Garment
  • Political consumerism
  • Supply chain
  • Sustainability
  • Textiles
  • Traceability
  • Transparency