Pricing and Payment Terms
H&M reports that it ringfences labor costs as part of its purchasing practices so that labor prices are not part of negotiations. It states that it has a supplier relationship management system through which it evaluates and rewards responsible suppliers, and it reports that for the best performing suppliers, it plans order capacity 3–5 years ahead. The company discloses that its payment times are 30 days.
Planning and Forecasting
Hugo Boss is an accredited company of the Fair Labor Association (FLA), which reported that where a supplier orders extra materials based on agreed forecasts, Hugo Boss will purchase back the materials so that the supplier is not responsible for the excess cost. The FLA also reports that planning is done one year in advance of the purchase order placement.