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Kurt Salmon Mapped Apparel Supply Chains With Tech. Here’s What They Learned.

Sustainability isn’t something stakeholders in apparel need to do—it’s simply what they must be, from how raw materials transform into the clothing that downstream consumers purchase in retail stores and on e-commerce sites.

But as anyone in the industry knows, overhauling far-reaching supply chains to meet sustainable standards is a tall order and a feat even more difficult to prove to the watchful eyes of shoppers all too ready to sacrifice brands on the alter of cancel culture. Though customers increasingly expect clothing companies to do the right thing, brands find themselves ignorant—willfully or otherwise—of what’s really going on in murky supply chains, and suppliers, for their part, don’t feel like they’re getting enough credit for all the work they put into greening ­­their mills, factories and farms.

At the MIT Sloan Retail Conference earlier this month, researchers examining perennial problems plaguing the fashion supply chain laid out the myriad reasons why traceability and transparency remain a thorny challenge for an industry in which fatal fires and other disasters all too often claim the lives of innocent garment workers.

From consumers, manufacturers and retailers to ginners, spinners, agricultural co-ops, farmers, politicians and 3PLs, the apparel ecosystem is brimming with stakeholders and touchpoints in the journey from seed to store.

Hypothetically speaking, it’s technically possible to “fix” supply chain transparency with technologies that already exist. “In today’s world, you could easily imagine every factory being equipped” with GPS-tagged cameras built with IoT sensors and affixed to cut-and-sew equipment, Akshay Madane, senior manager at Kurt Salmon, part of Accenture Strategy, said.

These cameras could be programmed to activate randomly and capture a photograph of whomever is sewing a garment at that machine. Brands could match the picture against database information to ensure someone hasn’t switched identity cards and then house this data on an immutable platform like blockchain, Madane said. Although brands could make this happen, the problem, he added, is cost. “Making it scalable and making it cost effective is going to be challenging.”

Madane and Brian Ehrig, a Kurt Salmon managing director who leads product development and sourcing for apparel and footwear brands, spent a year interviewing and conducting primary research with fashion brands, manufacturers and suppliers, and insurance and compliance firms to gain an insider’s understanding of supply chain traceability and transparency. The brands, they said, encompassed a “who’s who” in the fashion world, including some of the world’s largest clothing companies with the greatest reach.

“Many of them try, or have tried and continue to keep trying to solve some of these problems on their own,” Ehrig said, “and despite how big they are, how much money they can invest, how powerful they are, they cannot change themselves.”

Regardless of a brand’s standing in luxury or athletic apparel or value-oriented mass-produced garb, all face and have failed to solve the same “consistent and pervasive” problems, Ehrig added.

The Kurt Salmon researchers identified 42 different pain points in the system map of the typical apparel supply chain. “Brands’ biggest fear is not really knowing if what they’re getting really is 100 percent organic or produced with sustainable practices,” Ehrig said, adding that few companies have enacted foolproof methods to validate supplier claims.

“If you believe that consumers care about sustainability, then that means that your future success as a business is tied toward being more sustainable,” he added.

It’s especially difficult to discern if a supplier has subcontracted some of its work as the “tentacles of the supply chain are going unmeasured,” Madane said.

Few fashion companies monitor vendors below the finished-goods level, Ehrig added, making it all but impossible to know who’s really responsible for the work being done and under what conditions those items were produced.

During the course of their research, Ehrig and Madane were able to identify more than 1,500 material suppliers for one brand with little insight beyond its finished-goods vendors. That goes to show that throwing technology at traceability can shed light on supply chain truths—but it’s very challenging and very expensive, Ehrig said. And though the pair had assumed that blockchain would be the answer to the question of traceability, analytics, it turned out, provided a better fit.

By matching up a list of brands’ finished-goods vendors with publicly available information like bills of lading and shipment data, the duo hoped to piece together who and from where materials, components and labor originate. That turned into a massive machine learning project, Ehrig said, with a hefty dose of natural language processing making sense of reams of documents. But countries like China, he noted, render this kind of undertaking nearly impossible, stemming from a 2014 decision to redact publicly available data like shipment originations. Goods moving within China, he said, are virtually untraceable for those relying on government-supplied data.

There’s little hope for the industry to change until across-the-board collaboration unites everyone on the same page, and factories no longer live in fear of exposing their data at the risk of losing tenuous, season-by-season relationships with the brands they produce for.

On both sides of the supply chain equation, audit fatigue is real. “The No. 1 reason that manufacturers get in trouble today is excessive use of labor,” Ehrig said. “And so brands now have excessive use of audit and basically, they don’t feel like they get a whole lot out of it because they feel like they have to do it.”

However, new companies are using tech like machine learning and software-as-a-service platforms to wring greater value from the audit process, Ehrig added. Companies like Inspectorio are helping to breathe new life into audits and quality control.

Relative to other fast-moving sectors, the apparel industry is “very much in the Stone Ages when it comes to technology and availability of information,” Ehrig said. “As digitally enabled as they all seem on the front end, everything that is happening on the back end is offline, paper based and email based.”

But consumers, too, bear some responsibility for misaligning what they say they want with what they actually do, Ehrig added, pointing to the paradox of consumers claiming to prize sustainability despite 60 percent of purchases ending up landfilled.

“People want more sustainable [products] yet throw so much away or don’t use it at all,” he said.

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