Up Close is Sourcing Journal’s regular check-in with industry executives to get their take on topics ranging from personal style to their company’s latest moves. In this Q&A, Mark Hudson, vice president global marketing and communications at sourcing technology firm CBX Software, shares how COVID-19 has forced him to change his shopping habits and why diversifying suppliers matters now more than ever.
Name: Mark Hudson
Title: vice president global marketing and communications
Company: CBX Software
Which other industry has the best handle on the supply chain? What can apparel learn?
I think all industries are struggling. If I look just within the retail industry, I would say the grocery supply chain has handled it well, under the circumstances. I mean, I know the grocery stores have been out of stock for a number of items—paper towels, toilet paper, hand sanitizers, things like that. However, they did get back in supply. Even though they definitely hit a speed bump and there were some issues there, they quickly recovered, and I would say they handled it well, because they had to scramble and they had to figure things out quickly in order to get the shelves back in stock. So they’ve learned a lot from going through this, and I think they’re now at a point where they’re handling it better than a lot of other supply chains.
With grocery, you kind of have things coming in locally, and in apparel, a lot of times, things are coming in from wherever—Vietnam, Bangladesh, China, so it’s slightly different. But I think the apparel industry had a lot more time to deal with things than the grocery industry…. Grocery retail turned it around in a pretty quick amount of time whereas the apparel industry has not really turned it around yet. There’s things still turned off and China and factories were shut down for a long time. I think it comes down to a sheer case of grocery retail has multiple suppliers, and in a lot of cases [apparel] merchandisers and buyers rely on one supplier or maybe they have one or two factories they work with all the time. And in grocery retail, they have five to 10 suppliers they can go to quickly and pivot. It’s hard for the retail industry or hard goods industry to make a quick pivot when they only have one or two suppliers that they’re using as go-to the suppliers.
How would you describe yourself as a consumer?
I’m an old-school average avid shopper where I actually go into stores and shop. I don’t go to the mall a ton and shop for clothes—I’m just not that type of person. But when I do need something, I will go to the mall and it’s once or twice a year. And that’s it. I don’t shop online. I go to the stores, I need to see it, touch it, feel it, and in some cases even try it on.
I’m probably one of the few remaining that still liked going to stores to do my shopping. And now with COVID, I had to change because stores weren’t open, and I found myself shopping online more, I found myself getting used to it more, and in the end I found myself liking it. It’s just a lot more convenient.
As a consumer, what does it take to win your loyalty?
Customer service, quality. If I’m buying something, it has to be good quality. It has to be something that’s going to last a while, not something that you’re going to wash five or six times and it’s going to fade or get lint pills or fall apart.
I also like new and unique stuff. I might not always buy it, but I like to look at something new. It’s so boring when you actually go into a store and everything looks the same. “I was in here six months ago, nothing’s really changed, they’ve got the same old, same old.”
What’s your typical uniform?
What I normally wear is pretty laid back. You’ll find me in a sweatshirt and jeans for the most part. But I work at home. I do travel quite a bit, obviously pre-COVID, and I spend a lot of time in Hong Kong. So, when I’m over there, and when I’m actually in a physical office—in the CBX office—I’m usually in a pair of jeans and a button-down shirt. You won’t find me in a tie, rarely a suit, maybe a sport coat if I’m visiting a client.
Which fashion era is your favorite?
I was born in 1975, so I’m not that old, but I traditionally like the ‘60s because they’re pretty laid back, like I am now. I fell in love with music like the Grateful Dead and Phish who all played in the ‘60s and Woodstock. I always tell people I should have been born in the ‘60s or a teenager in the ‘60s because I just like that generation. And I don’t know if there’s really one style icon from that generation, but they all seem to be laid back—ripped jeans, tie-dye T-shirts, that’s probably my style.
What’s the best decision your company has made in the last year?
We launched a mobile application called Trade Beyond. It’s a marketplace where retailers can go and find very unique products from new suppliers. The suppliers that they find on Trade Beyond are vetted, meaning we take the extra step, we go through a third-party certification and auditing firm, and they vet the suppliers out. At least from a pre-screening perspective, we know they’re real, we know they’ve passed some audits, we know they have certain certifications, whether that’s they passed child labor laws, or conflict mineral reports, we capture all that to actually vet them out and verify them. I, as a retailer, might want to do more as far as vetting them or verifying them or might need to ask them for some more documents. However, we’ve taken probably 30 to 60 days out of the process.
Not only to find new suppliers, but as a retailer, I can work with my own already existing supplier network. And it’s a way for suppliers to share their products with their retail customers, for suppliers to share their products with non-existing retail customers where they’re looking to pick up new business. So it’s really a collaboration between retailers and suppliers in all phases of retail—apparel, hard lines, soft lines, etc. So I think it’s probably one of the smartest decisions we’ve made. You can’t really plan what’s going on now. It just happened, we got lucky, and we launched Trade Beyond the second half of last year. People can’t go to trade shows, there’s no buying trips, they’re not going to factory visits, they’re not going to supplier or factory showrooms. You just can’t get on a plane and go overseas.
How would you describe your corporate culture?
The culture is solid, because we’re a small company; given the fact that we’re global and we have a lot of global offices, we run pretty lean. The size of CBX from an employees perspective is not huge, it’s 250. But when you look at our customer base and the revenue that we’re generating, that’s a very tiny staff for the actual revenue size of the company. And so, we all have to work together, and even during COVID, and everybody’s at home, it’s just like a light switch flipped on because everybody’s traveling. We run so lean, that we all keep connected with each other. So now the culture didn’t change all that much during COVID, only because we’re just all used to connecting anyway, no matter where we are in the world. So, I think that just helps, we’re kind of built that way.
What can companies learn from COVID-19?
A lot of larger companies are very compartmentalized, and when that happens, it creates silos, and one team doesn’t know what the other team is doing. So, I think they can learn how to work together better.
And now from COVID, I think they have to be ready to pivot, or be ready for some adversity. [Now, working from home,] people probably aren’t sitting in their office at the computer, like a normal work day, which I know can happen if you’re not used to working from home… Companies can learn how to prepare for that better. And also, probably, learn how to hire better, because it’s a totally different mindset working at home.
What should be the apparel industry’s top priority now?
I would say technology… Even when we come out of COVID, things are going to look differently. They keep talking about a new normal. I think even if a vaccine comes out, I still think we’re going to be in a new normal ongoing for a long time. I think people are going to get used to working from home and get used to shopping online and they’re going to get used to some things. And I would look to the future and how to grow the business. There’s technology collaboration tools. I would take a hard look at the business and figure out where are my low hanging fruit—is it in sourcing, is it in supply chains, is it in product development, is it in-store technology where I can help the customers better? They have to figure out what system or what application will best fit that need. And then they have to pull the trigger, because it’s not going to get any better.
What keeps you up at night?
Like everybody, COVID keeps me up at night, and you worry about it and you wonder what the future holds. You see the number of retailers that are filing for bankruptcy is just off the charts. Even before COVID, we’ve had issues of retailers going out of business and teetering on the edge. And then COVID hit, and now it seems like every day there’s a new report of a retailer filing bankruptcy, and that’s scary a little bit. What does the future look like? So I worry about that, not only from a personal standpoint of where am I going to shop. And then from a professional standpoint, obviously we sell software to the retail industry. And if there’s no retailers left to sell software to, that’s not good for us.
What makes you most optimistic?
Retailers, no matter who they are, they have a budget to buy technology and they can’t buy everything. And over probably the last 10 or 15 years, a lot of that allocation has gone to in-store technology, really to help the consumer. So there’s been a lot spent around that, and not as much spent around upstream sourcing and supply chain and product development. So even though CBX has been doing well, there’s been a number of cases where we kind of got the shaft because the budget allocation just went a different way. So I’m optimistic now with COVID, that maybe that will open some eyeballs. And people will say, “We’ve got to invest in the upstream part of our business because now that’s failing us.”
Tell us about your company’s latest product introduction:
Trade Beyond is taking off in more ways than I can even imagine. We are now not only talking to all different types of retailers in all different categories—apparel being one of them—but we’re also talking to very large companies that run trade shows. We’ve been in the retail business for so long; we didn’t really think about the trade show side of the business and retailer-type trade shows, and now that they’re all shut down and no one’s traveling, Trade Beyond is a very good product for today’s environment.