Trade, technology, sustainability, collaborations and trends make the denim world go around.
The topics were also among Rivet’s most-read and written about subjects in 2018.
To offer insight into how these buzzwords may evolve in 2019, Lenzing’s director of global business development for denim Tricia Carey, Soorty executive director of global sales and marketing Ebru Debbağ, Tejidos Royo sales manager Alberto Guzzetti and House of Gold designer Shirley Zheng sat down with Rivet managing editor Angela Velasquez at Bluezone in Munich last week for a panel titled, “Future Denim.”
From the uncertainty of trade wars and the new opportunities that come with it, to the impact of collaborations on the supply chain and retail sector, the denim insiders share their predictions for what’s next and what these topics will mean for the denim industry in 2019 and beyond.
Trade
U.S. President Donald Trump’s trade war with China, Carey said, has created a lot of confusion for Lenzing’s customers who are often left wondering what the news will mean for them. “You could wake up one morning and suddenly there’s a quota on imports coming in,” she said. “What does that mean for your business?”
Staying nimble is part of the solution. With production facilities in the U.S., U.K., Australia, Indonesia and China, Carey said the fiber producer has looked at how it needs to shift production. “I think most importantly is that we’re listening closer to our customers and we’re asking them where do you see some of the changes happening so that we can shift our fiber supply and our stocks to where they need to be,” she explained.
Carey added that she sees supply chains shifting away from China. U.S. brands are diversifying their supply chains and more companies are looking at Vietnam and Pakistan, she reported. Others are sourcing closer to home to eliminate the confusion. “We see a lot of activity coming from the mills in Mexico that are currently customers of ours,” she said.
Spanish denim mill Tejidos Royo sees more European brands that typically source in the Far East taking a serious look at sources closer to home. The strategy, Guzzetti said, is “fabulous” for Tejidos Royo because the opportunities for new business are get stronger. “For us, it’s a good move,” he said.
House of Gold, which operates denim and knitwear mills in China, initially felt the effects of the U.S. and China trade war. “We definitely took a little hit,” Zheng said. While the mill’s European customers are still buying textiles from China, she said prices for packaging and manufacturing in China are getting too high for most.
The company’s Chinese laundry facility caters to a premium client. However, House of Gold is looking outside China for large-scale production. “When we get into manufacturing for larger quantities, we’re looking to partnerships with a few countries,” Zheng said, naming Pakistan, Bangladesh, Vietnam and Mauritius as options.
For Soorty, which operates denim and garment mills in Pakistan and laundering facilities in Bangladesh, Debbağ said trade wars are driving the mill to re-evaluate its business model. “We’re claiming to be a global company with actually local solutions,” she said. “We are looking at how can disrupt ourselves for nearshoring.”
With Adidas Speedfactory as an example of how a brand can achieve localized on-demand product, and speed-to-market becoming an increasingly important topic for the mill’s customers, Soorty is considering collaborative concepts to manufacture closer to the end consumer in 2019. Debbağ said the company is reviewing opportunities to manufacture out of Turkey for the European market and in North America for its U.S. customer base.
“I think the trade wars have opened up a more disruptive discussion, which could provide more potential for the future of our industry if we can take it with a positive approach,” Debbağ said.
Technology
Technology and sustainability go hand in hand. “Technology for a denim company is a very important way to be a big player in the market. And what is actually important is to have the technology that is transparent,” Guzzetti said. Brands, he said, are approaching the mill to use its waterless Dry Indigo technology to produce customized product. And ultimately, he added, the transparent technology adds value to the product, giving brands a sustainable story they can share with the end-user.
The 2017 launch of Refibra, a lyocell fiber made with cotton scraps collected from garment production and wood pulp from responsibly managed forests, is an example of how Lenzing invests in technology to advance circularity. “This is where we see we can bring technology into the supply chain,” Carey said.
In the future, she expects to see more technology develop around indigo dyeing, adding that the future rests on layering technologies. For example, Carey urged brands to take Lenzing fiber technology and combine it with sustainable dyeing technology to create garments that still maintain the authentic character of denim.
“Designing with a purpose” is where Debbağ sees technology going in 2019 and beyond. And the topic of technology, she added, should not be overlooked as a marketing tool toward young generations. “That’s what they understand,” she said. “All of the millennials, who will have a majority of the purchasing power by 2020, understand digitalization.”
Sustainability
Lenzing sees transparency becoming a larger part of the sustainability conversation. To stay ahead of this, Carey said the company added a fiber identification to verify Refibra lyocell. The company is also taking a closer look at its own supply chain and is working with its pulp and tree suppliers to create a transparent value chain. The move recently led Lenzing to the rank of the No. 1 producer of wood-based fibers by Canopy, an NGO that looks at forestry policies.
In order for sustainability to become of greater importance to consumers, Debbağ said the supply chain needs to look at what the consumer is asking for, which she said is certified sustainable materials and garments. “I believe very strongly that blockchain by 2020 will become a new business model in our industry as it will enhance all the traceability and the tracking of [products] as well as be a gateway for the consumers to be integrated into the value chain,” she said.
Along with traceability and transparency, Debbağ said the industry needs to consider the re-commerce model. “The re-commerce market is estimated to be around $20 billion right now and by 2021, it’s going to grow to $33 billion,” she said. “This should make us work towards more circular models, starting with purposeful design and more sustainable materials like Tencel, Refibra and any other materials that are becoming available.”
Trends
Baggy jeans, gender fluid styling and streetwear are dominating the Fall/Winter 19-20 men’s runway shows, but the experts don’t see a major shift to wide silhouettes just yet.
“Every brand is coming back to their own identity,” Guzzetti said. “Every brand is looking for something different.” As a mill, he said Tejidos Royo is responding by customizing fabrics and color.
While skinny jeans remain core to collections, House of Gold sees some momentum with straight legs. “But we’re doing it with carpenter detail for more utility,” Zheng said.
Carey sees fewer destroyed jeans coming down the pipeline, which she noted allows more focus on the laundry and finishes. “And we definitely see more color,” she added. “Color is very important. And I think that’s appealing to the customer to buy a color to add in with their indigo products.”
Collaboration
For Soorty, Debbag said collaborations are more than two partners coming together. “Effective collaboration means that everyone works on an open-source idea, because collaborations are actually platform business models,” she explained. “And when you become a platform, it is very important to share the innovation.”
“For Lenzing, we are only the fiber—without collaboration we are nothing,” Carey said. The company recently teamed with Teijdos Royo, Officina+39 and Tonello for Planet REHab, a capsule collection designed by Guatemalan designer Juan Carlos Gordillo. The partnership offers an opportunity for Lenzing and its collaborators to show designers how they can use the supply chain to achieve their desired look. “I think this is where we want to be a solution provider for what brands and retailers are looking for,” she said.
More importantly, Carey added, is to have conscious collaboration. “This is where we aligned with companies that have the same strategic goals and most of the time it is related around sustainability,” she added. “The collaboration has make great sense for the companies that are working well together.”
And following popular collaborations like Ralph Lauren x Palace and Levi’s x Kith, Zheng expects to see more partnerships crop up on the brand side of the denim business. “I think through collaboration you bring a new customer or you bring a new product—something that feels fresh.”
However, Zheng warned that collaborations could become too much of a good thing, especially when they originate from the same designer, such as in-demand creative Virgil Abloh. “I do think there’s a downfall to that because [Abloh] is the ‘It’ collaborator right now. He’s doing collaborations with Nike and Converse and some of the products are beginning to look too similar,” she said.