Council Post: How Sustainability, Community And Profitability Interact In Artisan

Amit Basu is the founder & CEO of Artisan Furniture, the world’s first artisan marketplace.

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I’ve spent most of my business life pursuing a dream: developing products that consumers love, made by global artisans in a way that provides decent levels of revenue back to them. To ensure those flows while maintaining profitability, I determined a good approach was shortening our supply chain. The traditional supply chain has a long process, going from the artisan/maker to the exporter and importer, then to the distributor, wholesaler and, finally, the retailer. By acting as the distributor/wholesaler, we can connect more directly with our community of artisans, thereby getting them closer to retailers.

Along the way, sustainability has become non-negotiable as environmental, social and governance (ESG) frameworks and targets have become core pillars in Western economies. The industry has shown that focusing on these factors can force positive change, both for the world and for companies’ profitability.

Good Business Sense—And Fair Play

Consumers want high-quality, authentic items, but they also want to know that the workers making these products are treated fairly. I work closely with skilled craftspeople in India whose furniture, accessories, textiles and other items are exported all over the world. So, it was very important to be conscious of exploitative labor practices, which are prevalent in the country’s textile industry.

When working with our artisans, shortening the supply chain should be about more than efficiency and bringing these partners closer. It should also be about fairness. Our supply chain is a system where everyone involved gets their fair share of returns regarding employment, entrepreneurial support and profit.

Making Environmental Commitments

Sustainable supply chains are becoming a requirement of doing business. However, it may be hard for small artisan businesses to visualize how to combine sustainable efforts with community support and profitability. Here are some strategies worth trying.

Take a step back.

Look at the key components of your business, such as the supply chain, and identify sustainable opportunities at each step. Incremental change adds up to a big leap in carbon or waste reduction. For example, localized, community-based manufacturing minimizes your carbon footprint because products travel less. As another example, we use AI-based tech to determine the best option out of our artisanal communities for a product, using factors like price or distance.

Investigate the switch to digital.

Digital solutions can be a way to cut down on red tape in production. Making a switch can mean anything from providing online ordering to simply automating certain operational processes, like payroll. Adopting new technologies can also help you keep an eye on sustainability efforts, like where your carbon footprint currently sits or areas where you can create energy savings.

There are many emerging digital platforms that can support businesses as they pursue a sustainable and community-minded path. They can guide companies through the daunting processes of measuring and reporting emissions, as well as determining benchmarks for emission reduction, which can help small companies with tight budgets avoid hiring consultants.

Consult with your employees.

Your workers are often best placed to offer ideas on efficiency and productivity. Garnering their feedback is a good strategy for finding solutions you hadn’t considered. You can collect feedback through constant communication with the artisans. For example, we conduct half-yearly performance evaluations with employees, where we touch on these topics. We also engage in quarterly face-to-face meetings or phone calls with artisans, as well as make annual visits to their premises.

Find partners that are fair and transparent.

If you have a labor force in a developing country, make sure your local partners pay fair rates and offer decent working conditions. Using a transparent process that takes compliance into account is one strategy. Another is comprehensive onboarding processes that include extensive reviews of partners’ standards and ensuring payments make their way to the artisans directly. Engaging with partners that prioritize community and sustainability helps ensure your business is both fair and protected from liability.

Become a champion for sustainability and ESG efforts.

To build a company that is sustainable and profitable, it’s important to set practical goals and stick to them. For example, our products rely predominantly on wood, so our goals include using sustainable and reclaimed timber. We also encourage the conversion of unsold furniture into smaller pieces to avoid waste.

Having specific goals and a reasonable timeline in mind will keep your efforts in perspective. Even if there are costly short-term impacts, you’ll be able to focus on the long-term benefits you’re working toward. This will also allow you to constantly evaluate your efforts and continue to find efficient solutions.

Building practical sustainability and community concepts into your procedures and policies can be a big ask. However, it’s necessary for the success of goods-producing companies. As an artisan business, it’s possible to integrate these priorities while maintaining profitability. It just requires thought, intentionality and commitment from all stakeholders.

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