Sourcing Journal’s annual summit was held for the first time virtually last week. More than 60 speakers weighed in on a range of topics affecting everything from circularity, trade and policy to the supply chain, inventory management and financing. Souring Journal founder and president Edward Hertzman kicked off the two-day event with the following remarks.
For the first time in eight years, we are not in New York together for the Sourcing Journal Fall Summit. Today, our online room is much larger and we welcome hundreds of you from around the world – a great gathering of our community in a time of Revolution. We are together, in part, because we know our industry is in peril. The crisis in fashion is on the front pages of every retail authority in the world.
This year’s September magazines – the biggest style issues of the year – were all about fixing fashion. The American Vogue cover was titled, Hope a Special Issue, “100 voices on the future of fashion.” British Vogue’s lead story was, “What Will It Really Take To Fix Fashion?” quoting every famous name in our industry. Vanessa Friedman in the New York Times interviewed celebrity designers on “What’s next?” with hardly a word about color palettes or new designs. Not one of these major media outlets was giving the fall forecast on style. Every question and opinion was about tipping points, making the world a better place, the glut-of-stuff, and words like redefine, reimagine, reinvent and relevance. Ralph Lauren said, “Living right now, the world is not frivolous. So fashion must find a way to be more meaningful, more purposeful, to add comfort and beauty to our lives.”
Olivier Rousteing, the designer of Balmain, said, “Fashion won’t exist anymore if it is only fashion.”
Once upon a time, Sourcing Journal was a niche publication for the back-office, the sourcing executive types, but no more. Our front pages for the past eight years are now the front pages of worldwide fashion. I never thought Vogue and Sourcing Journal would be in the same sentence. Anna Wintour and I are asking the same questions.
In Fall Summits of the past, I have given my trademark opening remarks that sometimes managed to offend someone in our audience. Since joining Penske Media in 2017, I have been trying to be a little more restrained, a bit more corporate, but I think in a year like this, what the hell, I want to be open, honest and direct.
I founded Sourcing Journal to communicate the price of cotton to the few who were interested. Now the question is, where does it come from, who is making it, and does it include conditions of forced labor? This is where fashion is today – looking for meaning, looking to make the world a better place, and needing to be accountable and vulnerable in a more transparent world.
After reading hundreds of quotes about what plagues our industry, my question is this: Can fashion fix itself? There is no shortage of opinion from high-profile people: changing calendars, a return to simplicity, diversity, dignity of work, sustainability, social vision….but behind all the sound bites there are no real solutions for the world’s most globalized industry. It is an eco-system, and it is broken. On that, we are united.
Our industry always thinks it can generate demand, which is why we put designers on pedestals and call them geniuses. But no collection or runway show will fix fashion. The cover stories, Twitter soundbites, and Instagram celebrities do not give us the answer.
Today and tomorrow we approach business head on to discuss the hard topics. Every one of us, regardless of role, title, or experience, must face the truth that we once again must become students of innovation. It’s going to take a monumental shift in the way we operate our companies for us to find a path back to growth and profitability. There was a time when the summit was attended largely by operations executives and suppliers. That is no longer true, with supply chains now at the center of a pandemic, trade wars, rampant closures and the assault of Amazon. The CEO of Saks, Marc Metrick, said this on his store’s future: “It starts with supply chain innovation. We need to go all the way upstream—from working with our fabric suppliers and factories to tightening commitments and lead times.” The CEO is the new Chief Supply Chain Officer.
Here is my point. Fashion isn’t an insider club anymore. Creativity is being redefined outside of product and style, and it requires a new vision of meaning and community. In our agenda today and tomorrow, insiders meet outsiders to champion innovation, begin the hard work of change, and look to the opportunities that might begin in crisis.
For the 2020 Summit Agenda, we have collected more than 60 top minds, many you may not know because they don’t have the cachet of Vogue interviews. The speakers you will meet are on the front lines to address the challenges those headlines and interviews are talking about.
Today, we aren’t going to simply re-state issues, we are going to address them without boiler plate PR commentary. These are on the ground executives-some from inside the industry, some from outside, but all committed to reinvent fashion. So, too, is our audience.
I want everyone to take a moment, and ask yourself….what gives your brand meaning? What problem or need does it solve? Why does it exist? This is a legitimate question we all need to ask ourselves because our future relies on it.
Are you faster than Amazon? No. Are you cheaper than Walmart? No. So what is your edge?
Today, it’s not just what you sell, it’s how you sell it.
Now I ask this question before I look at your style and price. I want to know if your values reflect mine. Where is this from? How was it made? Are you making the world a better place? In one of those September interviews, Riccardo Tisci of Burberry said, “Nobody’s elite anymore.” He understands that status alone is not enough. Your values are now your brand.
Gen Z and Gen C (if you don’t know this group look it up), they are shopping their values. They are coming into a world in chaos, they aren’t using fashion as an escape, they want to identify with brands that, like them, are trying to make the world more equitable, more sustainable.
There is an awful lot of greenwashing and good washing and what is genuine is hard to decipher.
I was the biggest skeptic on sustainability. I sourced and peddled $5 jeans for about a decade and only saw the world through that narrow lens. Consumer demand is changing and your organization must evolve with it. That next cheaper needle, or discount, or extension in terms is to step backward, not forward.
Just like those that listened to analysts and believed that e-commerce would never be more than a small portion of sales are kicking themselves now, we can’t ignore making these investments.
It may seem counterintuitive in a year rocked with bankruptcies, store closures and layoffs to be spending capital, but it is of paramount importance for survival. Don’t misunderstand me, If you expect instant returns next year you might be disappointed, but the alternative is you might not be relevant (or even around) in five years without it.
Too often this is an industry of laggards, slow to adopt to change. We can’t make that mistake again.
When you stop looking at sustainability as a cost, but as a core component of your image and a value to your customers, you will realize there is real economic benefit in running a sustainable business. Market value and social impact are now inseparable.
Is sustainability about the thread and dyes in a garment? Do you want your goods tied up in Customs because it originated in the Xinjiang Province? Or worse, be blasted in the New York Times for working there? Is sustainability just compliance so you can stay out of the news?
Being sustainable is about lowering your inventory liability, producing less waste. It is generating more working capital, selling through at a higher margin. This business model unlocks capital to invest in more sustainable products, practices and partners. The more you do that, the more the consumer will identify with and value your brand. Lower inventory, less waste, higher margins, better sell through, more consumer demand and more profitability. This is the economics of not only sustainability but our industry’s opportunity to be responsive, responsible and relevant. It is the only way to become profitable and purposeful.
Giorgio Armani said, “If we learn from our mistakes, we can build a better system, with a new sense of togetherness. But we have to operate in unison, and we have to reshape the system from the foundation up. I am ready.”
Are you ready? I am ready and here is what I say: Fashion is like a phoenix, it always rises from the ashes, even if in our cases it’s the ashes we have created ourselves.
Welcome to SJ Fall Summit. Let’s write the new headlines of fashion – together.
All of the session’s from this year’s Sourcing Journal Summit, R/Evolution, are available on-demand for the first time. Follow this link for more information.