Examination of Witnesses (Questions 540-544)
Mr Mike Barry, Mr Brian McCarthy, Mr Paul Ozanne and Mr Alan Wheeler
4 MARCH 2008
Q540 Chairman: Mr Barry, can you afford to get back to that idea?
Mr Barry: Can we take 60 million people on a journey to that? Let us be clear about this. M&S has made 100 commitments over the next five years to change environmentally and socially. To me, that is about softening the rough edges of our existing business model. Will Marks & Spencer and all retailers require a different kind of business model in ten, 15, 20 years' time, as Lord May was talking about? Quite probably, yes. However, to leap to that new model, you have to go through a series of steps that your business can cope with, your supply chain can cope with and, more to the point, that M&S's 16 million customers can cope with. You have asked a question about Oxfam, but let me tell you about what M&S has been doing today, because I think it is a pointer to the future. For several years now, M&S has been donating samples from its head office and rejects that customers bring back to us to Shelter and the Birth Defects Foundation, which would traditionally go to landfill but now we donate them. They are selling them to raise money for important causes. What we launched in January was a new thing. That is basically saying to 16 million M&S customers, "After you have bought a product from us, don't throw it away to landfill. Look at it as an opportunity to bring it to an Oxfam store so that they can sell it again, reuse it, extract an economic value from that to use in their vital development work overseas. In return, we will give you an incentive. We will give you a £5 voucher off your next £35 spend on clothing at M&S". It has been up and running for four weeks. I cannot share any detailed figures with you at this stage. We will be reporting on that formally some time later this summer. However, the response has been fantastic. Tens of thousands of M&S customers have bought into a different kind of model. Oxfam are seeing a significant uplift in their sales; we are seeing a significant diversion of clothing from landfill; and M&S has seen the benefit of more customers coming back to its stores rather than going to its competitors. It is a toe in the water. I am not going to sit here and say that it has revolutionised the whole approach to consumption in the UK, but it is an interesting model around what you can do. We have therefore given the consumer an incentive to change. You might have seen last week that we committed to starting to charge for previously free food carrier bags, on the basis that we have done the trial in Northern Ireland, where we are charging people about 5p for a previously free bag. Usage has plummeted by 70%. Again, customers have bought into it. Again, we have given them a stick—"5p? Don't want to pay that"—but we have given them a carrot; we give them a free bag for life before you introduce charging and then you make sure that the profits from it are ploughed back into their local community. How do we recycle? Every time you buy one of the hundreds of millions of items of clothing that M&S sells each year that comes on a hanger, you walk to the till and you buy it; you are left with a hanger. Do you take it home with you or do you throw it away? For several years now we have been encouraging people to recycle them; at the till point we take them back and reuse them or recycle them. We have had a real push and drive on that, prompting people at the till point, "Do you really need your hanger this time?" and we have seen a 30% uplift in hanger recycling—an extra 20 or 30 million hangers this year that we recycle.
Q541 Baroness Platt of Writtle: I just say, "No, I don't want a hanger", which is easier.
Mr Barry: Yes, exactly. What I am saying is that, with the Oxfam model, the charging for carrier bags model, and now the hanger recycling model, there are different ways to start to engage consumers in change. It is a long, hard journey, but you have to start changing your business model.
Chairman: Lord Howie, do you want to come in on this?
Q542 Lord Howie of Troon: There is one question that I would like to ask—not about the clothing exchange but about your eco-factories. Could you tell us what they are, and so on?
Mr Barry: We have created three new eco-stores in Marks & Spencer in the UK, in Bournemouth, Galashiels and Pollok, to try new technologies to make our stores demonstrably more sustainable for the future. Our learning from those three stores is now being taken out to the hundreds of M&S normal stores. We have then taken that model into our supply chain. We are developing a model with an existing supplier in North Wales, a furniture supplier, Westbridge, and three suppliers in Sri Lanka and one supplier in China, to build radically different production units for producing clothing. They will have a significantly lower environmental impact in terms of carbon footprint and water use. Again, I want to be very clear with you. The clothing manufacturing unit is not the biggest part of the environmental impact of a piece of clothing. That is the cotton field that produced it or the dye-house that used the chemicals. However, if we can start to make those individual building blocks of our value chain more sustainable, let us look at how we do it. We have a conference in our head office on 11 April. We are going to bring all our other clothing suppliers in to share the results of the first 12 months of these eco-factories, to learn what they can start to take out to change. You have to change not just the manufacturing unit, where you have massive social issues to address as well as environmental ones, but the dye-house and the spinning mill—and it is the raw material production as well. It is a toe in the water; a beginning, but an important one.
Q543 Lord May of Oxford: In so far as some of the customers may want to be informed about the sustainability and recyclability of the textiles they purchase, at the moment, unless you have made a simple project of it yourself, you do not have the information. If you were to put that information on a label, do you think that it should be done voluntarily or that there should be some code of practice or, alternatively, do you think that it is just too complicated to even think of putting it on a label?
Mr Barry: Labelling has its strengths and weaknesses. Fifty per cent of consumers do not register the price of a product they put in the basket, and price is by a long way the most important driver for your decision-making in a shop. The next thing you can ask somebody to look at is health. We will shift briefly to food. Everybody is now putting these traffic lights on food: the reds, greens and ambers to say whether it has too much fat, salt or sugar in it. We have done that now for a year on 800 of our 5,000 products. It has had no demonstrable impact on sales. It has not shifted behaviour. So I am not looking at the price on the product; I am not really registering health as an issue. The next thing down is the packaging. I heard the debate with the previous group of witnesses. Packaging is the problem for the consumers, left in their kitchen. It is not my problem: it is their problem. There is therefore, rightly, a huge push on us to make sure that we can reduce the amount of packaging we use. We started to put WRAP labels on all our packaging to say what to do with it, including, "Sorry, you've got to put that in the bin". That takes you to the next level of decision-making. There are a lot of questions now about carbon labelling. Should you put a carbon label on products? Let me give you a clothing example of that. You could put a carbon label on this suit or on any item of clothing that M&S sells; but I know that 80% of the carbon footprint of the clothing is associated with the wash cycle—what you do with it after I have sold it to you. If I can encourage you to wash it at 300C rather than 400C and above, there is much more impact on the carbon footprint than anything I can do back down the supply chain. We do not need a new carbon label for that, however. There is wash temperature advice. It has been there for 50 years and people are well used to it. It says, "You could wash it at 40 but I would like to encourage you to wash it at 30"; so there is already carbon labelling on a product that people understand. The fifth level is can I put a label on this product to say, "No children made it. All the wool in it is from a sustainable source. No dodgy chemicals in it. Totally recyclable"? I think that you would drive the average consumer crazy at this stage. There are different ways of raising awareness of issues. You can use your website or information in store but for an on-product label it is very difficult. Let me finish off by explaining the cost of that. M&S sells 35,000 different product lines, virtually all of which are under its own label; we do not sell other people's products, by and large. As soon as you start putting a label on a product that says, "This is its environmental and social footprint", every time you shift the cotton field that produced the cotton or the apple farm that produced the apple—which you do frequently—you have to change the label.
Q544 Lord May of Oxford: In the interests of time, I myself thought it was a basically silly idea, and you are saying it is a silly idea.
Mr Barry: Yes.
Mr Wheeler: I just wanted to bring up an issue that Mike Barry raised about the carbon impact of textiles. There was some research that came out recently, published by the Institute for Manufacturing at Cambridge University, which actually looked at the environmental impacts of a cotton T-shirt and a viscose blouse. It is true to say that a significant majority of the carbon impact of the cotton T-shirt was during the use phase of the customers. When they looked at the viscose blouse, however, as a representative example of garments made from synthetic fibres, they found that the majority of the impact was still in the production phase. I just wanted to clarify that. I get the feeling that textile manufacturers and retailers have got hold of the cotton example; they have used that and they are purporting that to be the case across the entire range of fibres. This research shows that it is not the case—but that is just one example.
Mr Ozanne: A very quick point and somewhat of a warning, if I may. We have been in the industry a long time and we want to be in it for a long time to come. The textile reuse trade is viable at the moment; but if we are successful in collecting sufficient clothing and the markets for its reuse dry up, the whole thing will collapse and it will collapse extremely quickly. Therefore, there is a focus needed to find new markets, innovative markets, and ways of disassembling clothes so that they can be used as other things besides clothing.
Mr Wheeler: There was one other thing that I wanted to bring across; that is, as a means of finding new markets we need to close the recycling loop. One thing we could do is inform the public about how they can recycle their clothes and buy recycled clothes. A simple eco-label with, say, a percentage mark saying "So many per cent of this garment is made from recycled fibre", is just one way in which this could be done. You have to start somewhere.
Mr McCarthy: The Defra road map reinforces the point made by Lord May, which is that we are sitting on a potential time bomb of garments that are in storage in the home environment. There are garments that have been stored in wardrobes, which potentially could be released at some stage. The second brief point is that I do hope this will be a generational issue. I am aware that at Wellington School in Trafford it is the pupils who very much are the ones driving towards the recycling of products. I think that with the education of the consumer that Mike has mentioned, but also addressing education in the national curriculum, the message can be got across.
Chairman: I am very grateful to you, gentlemen. It has been a useful, helpful session. If there is an afterthought, let us know and, if we find that there is some gap in your evidence, we will be after you. Thank you very much.
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