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A quality product is the result of shared standards, cooperation, joint efforts and stable relationships based on trust with all supply chain partners. The Group believes in the importance of developing ever closer and more profitable synergies and partnerships with those who not only guarantee reliability in production performance, but also share the company’s values and expectations in terms of ethical, environmental and social standards.
A total of 6621 suppliers are involved in the manufacturing of Moncler and Stone Island products and are divided into four macro-categories: raw materials, façon manufacturers, finished products and services.
• Raw material suppliers mainly provide fabrics, yarns, down, leather and production accessories (buttons, zippers, ribbons, elastics, etc.). Fabrics are mainly sourced from Italy, Japan, Korea, China and France. Suppliers of yarn and production accessories are mainly Italian, while the down suppliers are European, North American and Asian.
• Façon manufacturers are suppliers with strong technical expertise to which the Group entrusts the production of finished products or intermediate phases of processing (dying, embroidery, etc.), while providing them with all the raw materials needed. In particular, this category includes dye houses that perform garment-dyeing to which Stone Island directly entrusts this process in Italy. The entire manufacturing process is carefully monitored by Group technicians who verify its compliance with the required standards through rigorous, ongoing field audits. In
particular, through this process outerwear, trousers, skirts, dresses, all tricot knitwear and some cut-and-sew knitwear are produced. Façon manufacturers are mainly located in Italy and Eastern Europe, areas where long manufacturing tradition guarantees very strong technical expertise and adequate production capacity. In particular, Italy is characterised by a strong expertise in very complex and unusual processes.
• Finished products suppliers are those who, having received the technical design of the products, are responsible for the realisation of the garment, including the raw materials sourcing phase, according to the Group standards; in addition, Moncler directly provides its finished products suppliers with some strategic raw materials such as down, nylon and, of course, logoed materials. During garment production there is constant interaction between the supplier and the Group experts, who make on-site visits and scrupulously supervise the process, to ensure that the final product meets the expected high level of quality. Some cut-and-sew knitwear (mainly t-shirts and polo shirts), some soft accessories (such as hats and gloves), shoes and bags, and small leather goods are mainly produced in this way. In particular, suppliers of cut-and-sew knitwear are based in Europe and Türkiye while suppliers of soft accessories are mainly Turkish and Italian with a high degree of specific skills; shoes, bags and small leather goods are realised by European suppliers, most of them Italian.
• Service providers support the Moncler Group in its pattern making, prototyping and quality control processes and are mainly based near its corporate offices.
Where possible, the Group employs local suppliers located near its main sites to benefit from logistical advantages, generate income and create employment opportunities in the communities where the Group operates.
Most suppliers (90%) are based2 in the EMEA Region, primarily in Italy.
The Group distributes its purchasing expenditure, so as to avoid situations of dependence on its suppliers that could represent a risk for the business. With regard to concentration, the top 40 suppliers account for 50% of the value of orders. The Group is careful to promptly identify critical situations that could cause potential supply disruptions and mitigate the related risk.
The Group periodically identifies its critical suppliers to involve them in targeted actions and initiatives. This identification process is based on a risk-based approach that takes into account, in addition to their importance to the Group in terms of the economic value of the orders commissioned, quality, delivery times, financial dependence of the supplier, and the Group’s ability to ensure the supply of goods and services if it has to replace a supplier quickly, and specific sustainability parameters, such as: the potential risk relating to human rights in the reference country, the sourcing of key raw materials with potential social and environmental impacts and the supply of strategic processes for the Group, with a particular focus on raw materials of animal origin and on the relevance to the business. Finally, since 2022, a screening is conducted by qualified, experienced third parties to identify possible cases or signs of conflict of interest on all Group suppliers, including critical suppliers.
As of today, the majority of the Group’s critical supplier workers are women (around 68%) and the percentage of migrant workers is around 5% of the workforce.
Moncler has been implementing its Supply Chain Excellence programme for years. It aims to bring the supply chain to a level of excellence by developing the operational and industrial area according to an advanced model functional to coping with a constantly changing market.
People and their contributions are the cornerstones of the entire programme. All company departments are involved in working groups. Today’s critical factors of success were analysed, along with those needed for the future, and specific projects were therefore launched, all with the aim of achieving operational excellence in terms of quality, time to market, sustainability, reliability, flexibility and efficiency.
The main initiatives in 2022 included:
• Collection Excellence: the Product Lifecycle Management – PLM platform was extended to all product lines and categories. All information relating to the development of the collections is now in a single environment shared by all the functions involved in the process, increasing its sharing and efficiency. In 2022 the platform’s operational functionalities were refined, and further developments are expected in 2023, including the expansion of data to include other company management softwares.
• Supply Chain Collaboration: the project aimed at creating a new collaboration platform that will allow Moncler to increase visibility and control of all production phases with consequent advantages in terms of reactivity and operational flexibility slowed in recent years due to changing economic and political context related to the Covid-19 health emergency, among other factors. The project was resumed in 2021 and will become fully operational in 2023. The new platform will be shared with façon manufacturers, who will have special applications to communicate with Moncler in real time, thereby improving their management of raw material warehouses, production planning, and incoming logistics.
• Data-based scientific approach: in order to constantly improve supply chain management processes, each month the management team meets to monitor operating performance based on a set of indicators that analyse the performances of the various operating areas of Supply Chain & Operation processes.
• Continuous improvement of garment quality: the process of honing internal technical skills continued to ensure constant oversight of the design, industrialisation, pre-production and production phases, whether performed internally or by suppliers. This approach entails a constantly increasing focus on the quality of upstream process execution that will help reduce possible non-conformities of finished products.
• Shipment tracking: in 2022 a project was launched for accurate tracking of shipments, from raw materials to distribution of the finished product, providing timely information on the progress of the various phases, including through an ad hoc report. In 2023 this system will also be extended to repair orders for the garments produced, and tracking of shipments will be integrated into the supplier portal.
• 3D Project: In 2018 Moncler started to integrate 3D technology into its product development process. Digital design minimises the need for physical samples, reducing waste, development times and prototype production costs. This makes it possible to digitally adjust the fit, find the right proportion for each size and check the rendering of different fabrics, colours and patterns. On average, 30% of virtual garments are actually prototyped. In 2022 the Group launched the first 3D modelling course with the goal of gradually forming a multidisciplinary group capable of responding quickly to collection development needs.
• Zero Waste Project: all obsolete materials (fabrics, components, etc.) in the Moncler brand’s main warehouse began to be classified and verified starting in 2021. This activity allowed to have a timely view of inventories, making them available for the production of new collections, thus reducing the generation of waste. Recovery activity intensified in 2022, thanks in part to the formation of a team dedicated to the continuous search for fabrics and accessories in the warehouse to be reused in the new collections.
• Early Product Engineering Programme: companies with a strong propensity for innovative design, such as Moncler, tend to experience issues of various kinds close to the launch of the sample collection into production, with a consequent significant negative impact at the level of economic performance, time, cost and waste. The Early Product Engineering Programme enables any critical issues to be identified and addressed in advance with all development teams so that the problem can be solved quickly: the so-called, design for manufacturing.
Lastly, in 2022, to promote the inclusion in the Company of technical personnel specialised in the fashion sector, Moncler launched the MATE (Moncler Academy for Technical Excellence) programme to create a school of craftmanship aimed at training the technical personnel required to develop the business, such as prototypers, pattern makers and quality experts. In 2022 the programme involved 24 participants who, following the first basic training phase, are continuing with specialist training in Italy and abroad. The process will conclude at the end of 2023 with their inclusion in the company’s production functions. In addition, in 2022 a training programme of three to six months was also launched in Romania to train new manufacturing personnel for the production site. Sixty new workstations were introduced as part of this programme.
1 Excluding suppliers with sales order of less than 1,000 euros per year.
2 For façon manufacturers and finished product suppliers, the geographic location is the country the product was ‘made in’; for service
and raw material suppliers, it is the country where the supplier’s head office is registered. Percentages calculated on the number of suppliers.
3 Percentages calculated on the number of suppliers.