Gap Goes Green

Sadie Keljikian, Express Trade Capital

As a result of the recent Paris Climate Talks, Gap Inc. announced that it will reduce its absolute greenhouse emissions by 50% by the end of 2020. The White House said of the gathering that “[t]oday, more than 190 countries came together to adopt the most ambitious climate change agreement in history.”

Though the ultimate extent of the agreement’s impact is still undecided, the Climate Talk’s proposals singled out the apparel industry as a particular industry of concern. In terms of manufacturing, the participants were particularly concerned about the wasted and polluted water, toxic chemicals in dyes, and massive quantities of landfill produced by more disposable clothing in recent years.  Moreover, the industry relies on significant power usage and packaging in manufacturing and delivering its goods.

In response, Gap Inc., owner of Gap as well as Banana Republic, Old Navy, Athleta and Intermix, issued a report mandating halving emissions over the next five years. Representatives from the company claim that the reductions will be made throughout all of its subsidiaries, meaning that retail stores and factories alike will be revamped with a more conscientious model.

A significant part of the changes to take place will be measures to save electricity in the retail locations owned by the company, of which there are more than 3,000. Gap Inc. plans to replace light bulbs with more efficient LED lights, use smart thermostats, turn off unnecessary lights at night and use an industry shipment program to limit fuel wastage.

With a large portion of these improvements coming from energy usage, Melissa Fifield, senior director of sustainable innovation at Gap Inc. says: “The beautiful thing about energy savings, unlike some other areas, is it’s very directly tied to cost, and as the cost of energy goes up, there’s an incentive in the business to save that energy as well.”

Gap also plans to divert 80% of the waste from its domestic facilities away from landfills by recycling clothing materials as well as boxes, hangers, and plastic packaging used to ship merchandise.

But Gap isn’t stopping with environmental responsibility. Shoppers have shifted their focus away from cheap goods and have begun to gravitate toward companies with more ethical practices. Consumers consider whether factory employees worked under fair and safe conditions. Gap says they also plan on making a more concerted effort to manage the safety and well-being of factory employees abroad as they enact their new, kinder model.

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Cambodian Factory Pactics Breaks the Mold

Sadie Keljikian, Express Trade Capital

Dutch factory owner Piet Holten, president of Pactics, a manufacturing company in Cambodia, is creating a modern, conscientious model for manufacturing companies in Southeast Asia.

Cambodia has the second highest number of non-government organizations (NGOs) which aim to stimulate local employment by supporting workshops that make goods for tourists. Unfortunately, Holten says the “NGOs are trying hard to do good. They have a good heart, but in the end the effect is minimal.”

Pactics manufactures soft cases and microfiber cleaning cloths for glasses, sunglasses and goggles. Their clients include several high-end brands including Oakley, Rayban, and Tiffany. Contrary to the unfortunate standard of manufacturing in Southeast Asia, Pactics places a high-emphasis on employee well-being as well as the environment.

The naturally lit, wheelchair accessible factory derives 40% of its power from solar panels. Power is supplemented with a backup generator, which runs on biofuels. Rainwater is collected and used for plumbing purposes and there is a purification plant for drinking water on site. The workforce, which is mainly young women, receives a daily subsidized lunch, four months of paid maternity leave, health insurance and accident insurance. The facility also contains a daycare with rooms for nursing mothers and a first-aid room with a staff nurse.

Interestingly, Pactics pays its employees based on productivity, a practice which has allowed factories to pay their employees as little as possible historically. However, Pactics staff not only have a minimum guaranteed income of $125 a month, far more than the national average of $1,000 a year, but they also receive 44 days of paid vacation per year. The business also offers genuine upward mobility, with training programs that not only address basic things like machinery operation, but also relations within the workplace, sexual harassment education and prevention (Pactics has a very strict policy against harassment), and hygienic use of restrooms.

Pactics also contributes $50 per year toward each employee’s education and pays for half the cost of a crash helmet for each. The crash helmet is a necessary safety accessory for the workforce, as they commute primarily via motorized scooter in a country notorious for its highly dangerous traffic.

Creating an efficient and happy workforce means that employees are more likely to stay and improve, allowing the factory to run better and the staff to become better acquainted with this type of work. With the factory running smoothly, Holten says his next mission is to convey the importance of responsible business management to his clients, in hopes that they will make more active choices to support ethically run factories.

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Express Client Featured on The Steve Harvey Show

Urban Intimates, a company founded and operated by wife and husband team Psyche and Vontoba Terry, is being showcased on The Steve Harvey Show today (EST 3pm – WNBC). Express Trade Capital has financed and supported the growth of Urban Intimates since early 2014.

Psyche will appear and represent her line on the show. Today she is a successful designer and entrepreneur who rose from humble beginnings in Michigan to build a brand that is now sold in over 3,000 retail locations. Her lingerie brand, Urban Intimates is tailored to women with curves, a traditionally under-served group in the lingerie category. Among other topics, Psyche will discuss her keys to success. A short blurb is available directly on Steve Harvey Show’s website.

In NYC market you can watch Psyche and Urban Intimates on the Steve Harvey Show today at 3pm EST on WNBC. Showtimes in your other regions are available here.

In addition to lingerie, Urban offers a line of skincare products.

Express is proud to be part of Psyche and Vontoba’s success.


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Macy’s Announces Cuts After Brutal Holiday Season

Sadie Keljikian, Express Trade Capital
With overseas markets in turmoil on Wednesday Macy’s announced that approximately 4,500 jobs will be eliminated, roughly 3% of its total workforce, as part of a significant restructuring move. According to Macy’s, a surprisingly weak holiday season has hurt the business’s bottom line.

The struggle to keep sales up has been felt throughout brick and mortar retail businesses this winter, particularly at Macy’s, with sales falling 4.7% in November and December. With temperatures higher than they’ve been in years, consumers were not looking to buy outerwear as early in the season, or in as large quantities.

In addition to unseasonable weather, Macy’s faces fierce competition from heavy discount retailers like T. J. Maxx and “fast-fashion” brands such as H&M and Zara. Fast-fashion refers to brands which produce and sell garments at an accelerated rate, allowing for mid-season merchandise adjustments when necessary. The shift to predominantly online shopping has also hurt the business, with online giants like Amazon gaining increasing market share. A stronger dollar is taking some of the blame as well, as Macy’s claims that international tourists have curbed their spending as a result.

Cutbacks will be distributed among some 3,000 store employee positions, 650 back-office positions, and 165 senior executive jobs, as well as a call center in St. Louis, which will be closed.

Along with downsizing the workforce, Macy’s plans to eliminate 36 of its department stores in favor of new off-price locations known as Macy’s Backstage, introduced last year. The company also plans to open new Macy’s and Bloomingdale’s stores in Abu Dhabi in 2018.

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