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Why On-Demand Manufacturing Is a Must to Eliminate Overproduction

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COVID-19 recovery is on the horizon but the pandemic's impact on sustainability, retail, product development and consumer buying patterns means the denim industry must evolve. Join Rivet on April 20th at 11 am ET for the COVID, One Year Later roundtable.

Apparel overproduction remains one of the biggest costs on both the industry and the environment. In fact, Omer Kulka, chief marketing officer at printing solutions provider Kornit Digital, estimates that between 20 and 25 percent of manufactured apparel goes unsold.

Such alarmingly high numbers indicate that apparel needs a better way to produce that not only keeps garments out of landfills, but also saves significant amounts of natural resources in the manufacturing process. In a recent fireside chat with Sourcing Journal president and founder Edward Hertzman, Kulka asserted that on-demand production is the next step to ensuring sustainability within the supply chain.

“When you produce on demand, what happens is…that instead of trying to sell what you’ve produced, you’re producing what you’ve already sold,” Kulka said. “That doesn’t reduce the risk. That eliminates the risk completely. Somebody actually buys something, and only then are you manufacturing it, so you’re not sitting on any inventory that’s at risk.”

Further, Kulka pointed out how on-demand could significantly curb apparel’s impact on the environment, given that as much as 60 percent of clothing ends up in incinerators or landfills within a year.

“From the financial perspective, yes, it’s the bottom line of never having markdowns, never having sold out bestsellers and never having markdown inventories. But from an environmental impact it means never making anything that is not going to be used,” Kulka said.

On-demand or just-in-time apparel production has been associated with smaller, nimbler, vertical business models that aren’t reliant on manufacturing SKUs in bulk. And Kulka admits that he knows the on-demand strategies are not easy to implement.

But while on-demand production has seen slow adoption across the board, Kulka believes the technological barriers to entry, particularly in the digital printing portion of the process, continue to fall.

Kulka noted that his “traditional” customers typically came from unique e-commerce backgrounds already focused on personalization and customization. Yet as its own technology has continued to evolve, Kornit has pivoted toward the mainstream market.

Kornit has had a big year when it comes to expanding its on-demand vision and overall scale. In August, Kornit acquired on-demand fulfillment software provider to integrate its workflow optimization expertise into its own Kornit Konnect cloud platform, which allows clients to monitor their production data in real time, from ink consumption to costs for particular colorways or designs.

The shift is important for larger retailers as they try to keep up with their more agile competitors. In today’s viral world, when any trend can catch fire and dissipate in the blink of an eye, apparel brands must always keep abreast of opportunities to capitalize on these waves. These “micro moments” as defined by Kulka, often present a 24-to-48-hour window to monetize that specific moment, whether it’s a sporting event or a political rally.

Click the image above to watch the video and learn more about why Kulka believes the “demand and supply” economy is primed for an outbreak of on-demand apparel production.

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