WE’RE IN THIS
TOGETHER WITH
OUR SUPPLIERS

This year has been exceptionally challenging for many parts of our business, not in the least for our supply chain. We caught up with PUMA’s Chief Sourcing Officer Anne-Laure Descours, to talk about the measures we took to overcome the COVID-19 crisis together with our suppliers.

CATch-Up: What impact has the COVID-19 pandemic had on our supply chain?

Anne-Laure Descours: Working in supply chains, we are used to dealing with tricky situations. However, 2020, especially the first half, has been very difficult. Many of our wholesale partners, as well as our own stores, had to close and no longer accepted new products. We said from the start that we’re in this together with our suppliers. We wanted to sustain the entire value chain and get through this crisis together.

CATch-Up: What did this mean in practice?

ALD: Well, for starters, we cancelled very few orders, in total less than 1% of our total order volume, and we also paid for those orders. As of today, all PUMA orders completed or in progress have been paid in full. We found other ways to deal with the situation.

CATCH-Up: Such as?

ALD: We agreed with some suppliers on longer lead times due to the lockdown in some countries. We have been in close conversations with our manufacturers, customers, landlords, banks and all other partners to find solutions. We have worked with both our retail partners and manufacturers to slow down shipments and stretch payments and make sure that we all share the burden and get through this together.

CATch-Up: Are there other ways how we can support our suppliers?

ALD: We are also offering our manufacturers access to our vendor financing program, a financial support package. Luckily, this is a system we have had this in place since 2016. The International Finance Corporation (IFC), banking group BNP Paribas and HSBC and our newest partner Standard Chartered offer attractive financing terms to our suppliers. With the four banking partners in place, we are well positioned to support our manufacturers through the vendor financing program.

CATch-Up: What impact has the COVID-19 pandemic had on the workers at our suppliers?

ALD: We deferred or advanced some future orders in a dialogue with our suppliers to make sure they have production in months which are critical for them, so they can maintain as many workers as possible and keep paying wages or rehire previously dismissed workers. Our team is in constant contact with our manufacturers to evaluate any risk related to any factory work suspension, workers’ layoffs, wage payments, overtime hours and working conditions.

CATch-UP: Are you also talking to workers directly?

ALD: Our direct hotline with workers and organizations representing them has remained open and we responded to all concerns that workers may have had. We have been working closely with the ILO Better Work Program to ensure workers are treated fair and acknowledge the Fair Labor Association guidance.

CATch-Up: Can you give examples of what such concerns may be?

ALD: We are closely following up that any work suspension or retrenchment procedures are as per law and workers are paid as per law.

CATch-Up: Is there anything else you would like to add?

ALD: I think it is important to say once more, that our manufacturers are our partners and as such, a critical part of PUMA’s success. We need to remember that without our suppliers, PUMA has no product to sell to our customers! From an ethical perspective, you don’t leave your partners out in the cold as soon as things get difficult. At PUMA, our relationship with our manufacturers is a long-term one and our responsibility is to find solutions together in such exceptional circumstances.