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Aii's Program Pricing Overview

Published: 22 July 2021
6 min read
Aii Programs
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When Aii launched our inaugural project, Mill/impact, we engaged leading improvement programs [KK1] to align KPIs and establish a standardized approach for driving resource savings in wet processing facilities.  In doing so, we offered a single price point for all Mill/impact programming.

Since then, Aii has utilized the framework established by the Mill/impact initiative to expand our programs in order to support the industry on a path to achieving carbon, water, waste and chemistry targets.  With diversification comes complexity, and we aim to maintain a transparent pricing structure by decoupling its many variables.

Program Pipeline: Aii utilizes a program pipeline to prepare and identify programs for industry scalability.  We apply a variety of funding approaches to these activities, bringing concepts to commercialization.  

Pre-seed: Includes research and activities to bring concepts to pilot.  Pre-seed projects are typically funded by a small group of motivated partners using a mix of philanthropic and industry funds. These projects tend to attract catalytic funding partners to support the development of programs that have a higher level of risk associated with proving measurable impact, and yet the defined area has been identified by industry and science-based thinking needing to be solved.

Pilot: Includes implementation activities to test new approaches for the industry to achieve supply chain goals.  For Pilot projects, Aii establishes an overarching budget, applying philanthropic funds when available, to establish a cost model for pilot participants. Typically, Aii co-develops these projects with industry partners who provide expertise and advisory support to maximize pilot participation and resources. Pilot projects are funded on a case-by-case basis.

Model: Includes efforts to standardize and prepare a program for scale.  Model activities typically stem from successful Pilots or from opportunities to expand currently “Scaled” programs to new regions and facility types.  Aii applies philanthropic funds to Model programs to support activities to standardize the process, preparing for Scale and to reduce the cost for participants in order to encourage getting involved.  Model activities are often funded using our 1/3 cost structure, where a brand pays 1/3, manufacturer pays 1/3 and Aii brings 1/3 funding from our philanthropic partners for program deployment.

Scale: Includes commercialized efforts of proven program activities.  Once a program has completed the Model phase of development, Aii applies a market- based costing approach for program deployment, meaning that philanthropic funds may not be available or may be limited to first come, first served basis.  Still, Aii strives to provide cost flexibility and shared cost opportunities for Scaled programs in order to meet the needs of our partners. When available, Aii may identify alternative forms of capital, such as debt financing, to support capital expenditure projects for program participants.  We may also apply philanthropic and government grants to these activities, most often when expanding to new regions or sectors. The most common price structure for Scaled activities is our ½ funding model, where a brand and manufacturer each pay ½ of the program cost.  

Programs: Aii provides a variety of programs[KK2]  and projects to our industry partners, all of which follow the program principles originally established by the Mill Improvement Alliance[KK3] .  Naturally, pricing varies for these initiatives based on the scope of activities and range of support provided. Contributors to program cost variability include:

Facility Type: Expanding our programs beyond wet-processing facilities enables Aii partners to effectively set and achieve comprehensive supply chain targets.  Facility types supported by Aii programs include, but are not limited to, cut & sew, wet-processing/dye-house, laundry and footwear. We anticipate expanding these efforts in the coming year to hardgoods and outdoor equipment.

Facility Size: For on-site program activities, Aii uses a variable pricing structure to align facility size with effort required to deliver comprehensive support.  For this purpose, we separate facilities into 3 categories.

Size of facility Total energy consumption (TJ) / Year
Small – Medium 2 000<
Medium – Large 2 000 – 4 000
Large >4 000

Remote vs In-person activities:  Our connected world allows for increased opportunities to provide impact program activities remotely.  Still, in-person learning and on-site consultations prove year after year just how effective they are for maximizing results.  When managed carefully, remote program activities can reduce travel and meeting costs.  Aii seeks balance and diversification in our programs to enable remote activities like a hotspot data analysis and facility prioritization activities while continuing to build communities of practitioners via in-person events.  

Location: Program costs can vary significantly by region.  As Aii expands the availability of programs globally, we have adopted a pricing structure that varies by location.  This allows for market-based costing and program commercialization. Currently, Aii provides cohort programs in mainland China, Taiwan region, Vietnam, South Korea, Pakistan, India and Italy. We anticipate ongoing cohort expansion to new regions based on industry demand, and we’ll continue to offer all programs globally using bespoke services of our expert partners.

Cohort vs Bespoke Participation: The most well-known and cost-effective way for Aii to deploy programs uses a “cohort” approach, which brings a group of facilities through an improvement program at the same time. We currently have cohort programs in mainland China, Taiwan region, Vietnam, South Korea, Pakistan, India and Italy.  

Outside of the cohort model, Aii partners with approved service providers to deliver the same standardized approach with aligned KPIs on a global basis.  These “bespoke” projects are typically priced on a case-by-case basis.

Cost Sharing

Shared Cost: Our partners benefit from pooling resources to collectively address barriers for scaled impact.  Aii brings organizations together in order to build out concepts and associated budgets to enable cost sharing and maximized results.

Co-nomination:  When two or more brands nominate the same facility during the recruitment phase.  Brands agree to work collaboratively with the facility throughout the program, and brands split the brand program fee.  Consequently, our partners can pay much less for program activities by enabling Aii to identify shared locations.

Facility Connection:  When a brand nominates a mill currently in program or that has previously completed a program and would like access to the mill information and data.  If the mill is still in the program, brands agree to work collaboratively with the mill for the remaining steps in the program.