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Is H&M Using Blockchain to Track Upscale Merch?

H&M was recently named the most transparent apparel and fashion company across 250 global retailers and brands, going out of its way to provide product transparency and material details for all garments sold on since 2019. But it appears the fast-fashion brand may be turning to a high-tech solution to offer public insight into the origins of its merchandise.

Cos, H&M’s upscale fashion brand, is the reported guinea pig for blockchain-based traceability, and said to be in partnership with enterprise-focused blockchain ecosystem VeChain. The retailer would not comment on the matter.

“We are constantly exploring new technology but at the moment I’m not in a position to speak about any new initiatives with in H&M Group,” Nina Shariati, sustainability strategist at H&M Group’s business development and innovation teams, told Sourcing Journal.

In a recent “Ask Me Anything” (AMA) post on Reddit, VeChain CEO Sunny Lu disclosed that the blockchain application platform was working with DNV GL, a global quality assurance and risk management company, on a project with a “fast fashion brand” that it had previously partnered with.

In the post, Lu stated that “more than 4,000 sustainability products were traced” using MyStory—a traceability platform designed to share every step of the garment’s journey. Shoppers can see the full history of a product by scanning a product’s QR code, which will indicate where specific processes including yarn spinning, knitting and inspections take place. Each time the product moves to a new step in the supply chain, a unique, timestamped code is sent to the VeChain blockchain.

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Retailers can choose to either keep the data internally for supply chain and auditing purposes, or use it as part of product branding and marketing.

H&M has partnered with VeChain in the past, lending credence to the presumptions that the fast fashion retailer is expanding its relationship with the tech startup. In 2018, H&M subsidiary Arket used the VeChain technology to verify the organic manufacturing process of its beanies and other apparel items.

Further fanning the flames of speculation, Chinese media platform Uncle Cat identified Cos as the likely partner, taking a photograph one of the retailer’s pullovers that includes a MyStory tag.

A report by a blockchain and cryptocurrency investment firm Cream suggests that with the partnership, Cos could enhance its upcoming secondhand “Resell” marketplace with the technology. For example, clothing items can have a non-fungible token pairing generated at the point of sale, providing the new owner with a token proving authenticity and an indisputable record of ownership. The VeChain partnership would ultimately ensure the quality of its suppliers and provide H&M with new ways to engage with consumers,  Cream noted.

Cos’ sustainable products must contain at least 50 percent sustainable fiber, with H&M noting that products often contain a much higher percentage of responsible fabrics.

H&M is pushing to use only 100 percent sustainable materials by 2030, phasing out orders of conventional cashmere by the end of 2020. As of 2019, 57 percent of all materials employed by the clothing giant were either recycled or sustainably sourced, a large jump from 35 percent in 2018. According to the retailer’s Sustainability Performance Report, H&M used 97 percent recycled or sustainably sourced cottons in 2019. For 2020, Cos aims to source 100 percent sustainable cotton.

Additionally, all of H&M’s 600 textile and leather suppliers are now enrolled in the Zero Discharge of Hazardous Chemicals program. The Swedish retailer is also rolling out a series of initiatives aimed at not only promoting sustainability in its own supply chain but also those of other companies. The company is joining forces with E.on, Scania and Siemens to form the Pathways Coalition to achieve fossil-free commercial heavy transport by 2050.