Apple Bottoms, Levis, Lee, GAP. Yours may not be one of the aforementioned brands, but I’d hedge all my bets that you own a pair of jeans. I do, and I love my all-year-round, many-occasion apparel. I am sure you have heard of Levis and Lee, but have you heard of MUD Jeans? No, not the dirty brown stuff, the brand.
MUD Jeans do things a little differently. They have a lease model for their organic cotton jeans, to ensure raw materials supply. Essentially, the customer becomes a supplier. So how does it work? You lease the jeans for a year. After a year you are notified that the lease is up. Upon returning the jeans, they provide various options. This can be in the form of discounts on a new pair, transforming your old pair into a stylish vintage pair, or breaking down the denim to blend with virgin cotton.
The company’s CEO, Bert van Son, realized that cotton is a resource that is subject to price fluctuation and supply disruption. This vulnerability of their supply chain required more effective use of the material that had already been purchased. While you can’t control your customer’s behavior, you can encourage certain behaviors which will benefit both parties. In MUD Jeans’ case, discounted items and free returns.
So why have I decided to write about this particular business model? Well, currently in Johannesburg we are experiencing water shortages and drought. Just this morning we were informed that our caterers cannot supply some of the vegetables on the menu as result of this drought. By rethinking your business models, you can potentially reduce reliance on raw or non-renewable material, build customer relationships and create a more sustainable business.
Supporting your business models should be an ERP solution which caters for effective supply chain, contact and environmental management. It also needs to allow for flexibility in times when resources may be unavailable (in the case of the veggies) or are required from another source (calling on customers in the MUD jeans example). Perhaps it’s time to start changing with the climate and using this to your advantage.
If you can envisage the opportunities or if I just got you to think “maybe” or “what if”, then my job here is done.