Visibility has become a hot topic in the apparel and footwear industry, as companies face mounting pressure to disclose and back up their authenticity and sustainability claims.
Even before the pandemic, fashion brands were increasing their investments in supply chain traceability tools, from cloud-based technology to physical trackers. And the adoption is only poised to increase.
“Track and trace of goods all the way back through the supply chain is very much top of mind for brands and retailers today, and they really are looking to expose that information to their customers and be very transparent,” said Robin Barrett Wilson, industry executive adviser of fashion at software company SAP. “Transparency is very much something that we find brands are doing today, not only because of Covid—because of course they want to be very transparent about how they’re keeping their employees safe as well as their customers safe—but they want to be transparent all the way through, and really be true to their brand.”
While the technology being used to monitor and track the Covid-19 vaccine supply chain largely existed before the pandemic, the process behind getting the doses from manufacturing to recipients contains insights for fashion as the industry seeks to ramp up its own traceability.
The vaccines require highly accurate cold chain monitoring to ensure safety and efficacy. For instance, Pfizer’s vials need to be kept at about 94 degrees below zero Fahrenheit. Filling this need for climate control, one of the traceability technologies taking off during the vaccine rollout is sensor-based logistics devices. These are attached to a package and can send near real-time data on aspects such as temperature, humidity and location.
For instance, FedEx’s SenseAware Bluetooth devices being used for the vaccines are designed for premium shipments, such as haute couture fashion or works of art. Along with temperature and humidity tracking, the sensors can issue alerts if a package experiences shock—which could mean possible damage to fragile items—or diverts from its planned route. To monitor potential theft, the sensor can also send out a ping if the parcel is exposed to light, indicating that it could have been opened or tampered with.
“From a track and trace and unmatched visibility, and providing insights for actionable items every step along the way, I think this technology is coming really handy. It’s truly an enabler from that standpoint,” said Premkumar Jagatheesan, global head of retail solutioning at information technology services firm Atos, which counts FedEx and UPS as clients.
However, Jagatheesan explained that not everything that is being done for the vaccine, such as these sensors, might be cost effective for fashion since the category is not as life critical as medicine.
“Everything comes with a cost, and that cost is passed on to the customer,” said Jagatheesan. “So the more you gold plate it, the price of the end product merchandise is going to go up, the customer will end up spending more. So it’s a thin line of difference between novelty, balancing the cost play, and offering that customer experience and value.”
As a more cost-efficient tracking option, fashion could turn to RFID tags to provide more inventory visibility. While RFID tags used to be reserved for high-value merchandise such as designer fashion or pricey bottles of wine, the cost has come down to just cents per tag. Unlike the sensor-based logistics devices, which would track conditions at a lot, box or container level, RFID tags would be affixed per unit.
Wherever a retailer places an RFID reader—within a distribution center or at a store’s back of house—the merchandise is automatically recorded. This replaces manual tasks such as scanning goods at receiving or performing inventory checks.
Fashion can also think smaller than RFID to get better visibility of its supply chain. Applied DNA Sciences, which specializes in molecular technology, uses much of the same polymerase chain reaction (PCR) technology used for vaccine production and Covid tests as it does for tagging and testing solutions for industries including pharmaceutical goods and textiles. “This technology that has medical uses also has commercial and industrial uses that relate to either helping to keep people healthy, or to keep supply chains healthy,” said MeiLin Wan, vice president, textile sales at Applied DNA Sciences.
The parallels between fashion and the vaccines extend to protection from fakes. The pharmaceutical industry is at risk for counterfeits, with potentially severe safety and health implications. The World Health Organization notes that while the problem of fake medicine, including vaccines, was previously focused largely on developing nations, today it is an issue in every region thanks to the global nature of the e-commerce business. Low- and middle-income countries remain the hardest hit, with the WHO estimating that one in 10 medical products are falsified or substandard.
To help pharmaceutical supply chains verify the validity of pills, Applied DNA has used its SigNature molecular tagging on individual tablets or active ingredients. Applied DNA’s SigNature tagging technology also powers its CertainT platform, which has been used in textiles to trace fibers such as cotton and wool. After tagging a raw material or product, the item can be tested or tracked to verify sustainability claims, such as proving that cotton is truly organic.
According to Wan, across supply chains, authenticating an end product should begin by monitoring the original material. “The onus of responsibility should be on that supply chain to ensure the safety and efficacy of that material, and that applies to textiles,” said Wan. “It starts at the source material and not somewhere in the middle, where a lot of blending and substitution of materials can happen.”
Applied DNA is aiming to advance DNA testing by training companies to do it themselves. This would allow them to audit their own supply chains and pass that information on to the brands as well as consumers. Wan compared this innovation to at-home DIY Covid tests. Currently, Wan says just a small number of companies have the ability to do this.
Wan encouraged companies that are considering traceability technology to try it out to see whether it works in their supply chain. “If everyone was just thinking about the idea of a vaccine, and they weren’t actually going out there and trying to figure out how to deal with it, we would be still talking about it to this point,” she said. “And I use that same analogy for traceability systems in fashion. There’s a lot of talk out there, but there’s not that many companies that are willing to really give it a go and try it.”
Another innovation helping to prove the provenance of products—including vaccines—is blockchain. In one example, Moderna is using the cloud-based SAP Information Collaboration Hub for Life Sciences, allowing it to verify the authenticity of its vaccines and comply with U.S. legislation. The vaccine manufacturer can push information to the blockchain, and distributors can request verification via this data source. The blockchain solution is also tied into SAP’s enterprise resource planning (ERP) and supply chain management software, giving Moderna more visibility into its end-to-end operations. Additionally, Moderna is leveraging SAP’s Advanced Track and Trace for Pharmaceuticals to assist with serializing its vaccines and regulatory reporting.
SAP’s track and trace solutions are also currently being used by both mass-market and luxury brands to protect their intellectual property. Akbar sees more potential for blockchain and similar software in the apparel industry.
Fashion is facing consumer and governmental pressure to prove the origins of garments. The U.S. has clamped down on cotton from China’s Xinjiang Uyghur Autonomous Region due to reports of forced labor. From a social and environmental sustainability standpoint, companies can use centralized data hubs to track their supply chains, proving the origins of raw materials and labor. These data banks can collect and disseminate sustainability information to customers, meeting their demands for transparency.
On the surface, vaccine safety precautions and environmental concerns for fashion are very different drivers for traceability. But for some consumers, sustainability is tied into health and wellness. “Those who are very conscientious about what they put in their body…want sustainable cotton, because sustainable cotton doesn’t use pesticides and it doesn’t harm the farmers that are growing that cotton,” said Wilson.
Beyond the communication benefits, having full visibility into the supply chain enables companies to quickly pivot and adjust to disruptions or changing consumer demand. This may mean moving production to a new location or changing up retail allocation.
Given the highly limited shelf life for the vaccine, inventory visibility is critical. And stockouts are also an issue, since they delay immunization. To reduce friction in the supply chain, Atos’ Jagatheesan sees the opportunity for more auto replenishment. By implementing sensors that count vials, a hospital could set up an automated system that puts an order in for more doses once they drop below a certain threshold. Retail could do the same, ensuring it doesn’t run out of key merchandise.
Fashion doesn’t have to contend with a cold chain, but it still has timeliness of delivery and sales to consider. Products that get past their prime sell-by date can eat away at the bottom line. “Although there’s no cold chain in fashion, there is definitely time limited seasons, which those fashion companies need to stick into, otherwise you’re going to lose any hope of getting any money or profitability,” said Peter Akbar, global vice president and chief customer officer fashion at SAP.
If companies do have leftover merchandise, SAP has partners that can tap into its data cloud to help retailers decide where and how to sell their goods in channels such as off-price retail. “Because it taps into our data, they understand the profitability, so you can actually make decisions based on how much money you’re going to make, whereas before you were kind of flying blind,” Akbar added.
Avoiding this fashion expiration comes down to demand planning, which Jagatheesan believes apparel is more sophisticated at than medicine. Retail has the added incentive to get traceability right, since it is strongly tied to the customer experience. “The lesson we are learning is, having that visibility will be the key,” he said. “Where I think retail is the best in class organizations, and retailers are ahead in terms of visibility, in terms of predicting the demand, in terms of positioning the merchandise closer to a customer and delivering it.”