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Op-Ed: 60 Million Ways to Illuminate and Engage Your Supply Chain

Sourcing Summit NY — Join us on Oct. 17 for the must-attend apparel supply chain conference.

The global apparel and footwear industry generates more than $1.8 trillion in sales. The sector designs, produces, ships and sells 80 billion garments and nearly 23 billion pairs of shoes every year. And, as the world’s population increases and incomes in emerging markets rise, those numbers are projected to grow by 20 percent to 30 percent in just the next 10 years.

Those numbers are staggering but there is a much smaller number we don’t focus on, though it may be the key to the industry’s future success: the 60 million human beings who sit at machines or stand at tables and make all of the footwear, clothing and accessories the world buys and wears.

Today’s brands and retailers feel the pressure to make product faster, improve quality and reduce costs. Costs have become even more critical as the industry in the U.S. is facing an extra 25 percent tariff penalty on certain products from China beginning as early as July. Engaging, enlightening and partnering with those 60 million artisans may be one of the best ways, not only to address our challenges, but to truly transform our industry.

Most businesses today are investing heavily in data science and artificial intelligence but the most under-utilized and unappreciated asset in all of our businesses and our supply chains is human intelligence. As an industry we don’t do a very good job of training, developing, educating or tapping into the human intelligence in our headquarters, stores or distribution centers, much less our supply chains. With a little twist of irony in this era of artificial intelligence, human resource strategy has never been more important.

It’s not just tariffs that are driving today’s sense of urgency. Technological change has been accelerating at a Moore’s Law-fueled pace for years and shows no sign of slowing down. As we sit on the verge of 5G communications, change is only going to come at us even faster, and it’s radically altering the expectations consumers have of retailers and brands. They want new products almost on-demand, they expect personalization if not outright customization, and they still demand the lowest price. But, increasingly, they’re asking for even more.

They want and expect workers to be treated fairly and paid a living wage; they want them to work in safe working conditions; they want to make sure manufacturers are not using child or forced labor or polluting the environment; they want transparency into where the products they buy are made and how they are made. They want to know if their cotton is organic or grown sustainably; they want to know whether or not their polyester is recycled; and they want to know where their leather comes from and how it was processed. We have heard for years that customers say they value certain things but when it came to putting their money where their mouths are, they retreated to the lowest price.

But those days are coming to an end.

A new generation

Rising Gen Z customers and every generation of customers behind them have and will have an entirely different set of expectations and demands on the brands they embrace than millennials and Boomers ever had. Millennials and Boomers have lived through nearly 30 years of deflation in apparel and footwear prices. They’ve been able to buy more and more partly because we’ve been able to charge less and less. The statistics for apparel and footwear purchased and never worn, and the percentage that ends up in landfills, are staggering. The next generation of consumers won’t tolerate that.

It’s not just our customers who are changing the equations by which we run our businesses. It’s our entire supply chain.

We see labor prices increasing everywhere, material shortages will be more frequent, and the costs of compliance, sustainability and transparency will continue to rise. We have “acceptable quality levels,” which is another way of saying we expect a certain percentage of our products will be defective. We expect that at least some orders will be late or some entire shipments will get rejected or marked down. If we charge back our vendors, do we really recoup what it costs in terms of our reputation with our customers? Here’s where those 60 million human beings, and the hundreds of thousands of factory owners who employ them, can begin to change the game with our help.

What if we could help educate, develop and harness the human intelligence of the 60 million operators, makers and artisans who make everything we wear? What if artisans, at their work stations, had visual access to see what defects looked like and could stop a product for correction before any additional production step was taken? What if their machines were wired so we could know when, or even anticipate when, a machine needed maintenance? What if we had full visibility to work-in-process, real-time, and we could reduce inventories by 10 percent, 20 percent, even 30 percent? What if artisans could see and gauge their skill, speed and quality level in real time and increase their earnings as they improved? What if we could ‘gamify’ their work, motivating and rewarding them, engaging their minds and intelligence, and having them actually enjoy what they’re doing? What if supervisors could anticipate bottlenecks before they occur and re-balance lines to meet delivery commitments? What if factory owners could improve their efficiencies to produce 30 percent, 40 percent, 50 percent more product with the same workforce? What if because every artisan became a quality assurance expert, there was no need for final QC?

If you could trust that every product had been inspected by every contributor to that product and vouched for it’s meeting its agreed-upon standard, why would you need to inspect at the end? Why would you ever get a return due to a quality issue? As we see more and more upstart brand business models going direct from factory to customer, can we really afford to have the customer doing QC in their home?

We can actually do all of these things today. We can redefine what quality is. Quality can be synonymous with ‘authentic.’

Authenticity is less about having an absence of defects and more about having all of the attributes that a brand has promised in a product including how, where and by whom it was made. We can empower and incentivize those 60 million artisans to build our products more efficiently, quickly, transparently and, yes, authentically. We just need to start. Just imagine what it would be like for 60 million artisans to smile at the end of each day, knowing that they made someone smile half a world away.

Ed Gribbin is the chief engagement officer at Impactiva, the world’s leading QA-QC expert in the apparel, footwear, materials and accessories sectors. In his new role, Ed will help Impactiva launch their digital supply chain ecosystem to enable sustainable production alignment and transform the entire industry—from artisans to consumers—in the areas of quality, efficiency, speed, flexibility, transparency, compliance, education, empowerment and self-reliance.

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