Last month, I had the opportunity of attending the 34th Edition of the International Apparel Federation (IAF) World Fashion Convention held at Maastricht (Netherlands). This was an excellent event with over 275 registered attendees from 27 countries including Bangladesh, the Benelux region, Brazil, China, Scandinavia, France, Germany, Hong Kong, India, Mexico, Pakistan, Turkey and Vietnam. Many brands, retailers and manufacturers attended this grand convention including H&M, Hugo Boss, Esquel, Escada, Triumph, Ashraf Industries, Puma, Stitch ‘N’ Style (Pvt.) Ltd., Mango, Delta Garments Ltd., Tainan Enterprise, Bivolino and VF Corp. The overall theme of the convention was ‘Smart’… ‘Building a Smart Future for Fashion’ with subtopics like Smart Supply Chain, Smart Material Use, Smart New Business Models, Smart Apparel Manufacturing and Smart New Retailing/Selling being covered in detail. To say the least, it was a fascinating couple of days of ‘idea sharing’, with speakers provoking the audience to take a look at the traditional methods and concepts and challenging the existing norms besides examining the requisite steps needed for moving towards a Smart Future for the apparel industry… to be more specific, the global apparel industry in both developed and developing countries. All countries involved in the industry would have benefited from this convention.
Han Bekke, President of IAF opened the convention by stressing upon the real challenges being faced by the apparel industry, which can, however, be approached from a positive angle. According to him, the industry is one of the largest employers worldwide, meeting the basic needs of millions of people and with a growing global population, the industry is assured of expanding markets. He underlined further that if we manage to create a more efficient, less polluting, more valuable industry, these improvements will not only generate more revenue but will also truly improve the lives of tens of millions of people.
Two days of the event witnessed the concept of ‘Smart having a lot do with technology’ being presented elaborately. The emphasis was on how digitizing the industry will enable us, in many ways, to become a more ‘normal’ industry, with less pressure on the system because we can produce less goods for which there is no demand. The discussion also revolved around how Smart is also about new ways of doing business. New business models are therefore needed to get us out of the spiral of looking for the cheapest production prices, pressure on margins with nearly constant sale and markdowns as a result of these. Smart is also about global collaboration in the industry to create systems that help us use technology, to cut out unnecessary costs or to create systemic changes. Smart is also about being more sustainable and it should be treated less like a separate topic and more as an integral part of creating a smarter industry.
When one thinks about the global apparel industry at present, the image is not very positive. We are often seen as the most polluting industry. Many people think we produce our products under bad labour conditions, not paying a decent or living wage, and even making use of child labour. But let us not ignore that there are many companies which work in a fully responsible way. Let us also not ignore that there are many good initiatives being taken the world over to make our industry more sustainable. Although international coordination is absolutely needed to really make progress in this field, Smart will, of course, be beneficial as it is also about people. Transforming the industry means educating people. New technology only works when we as an industry are able to educate people in the right way to use the technology. Collaboration in the industry is indeed a skill that can be taught.
The convention was closed with comments from Rahul Mehta, Immediate Past President of the IAF and President CMAI, who highlighted several key takeaways. He noted that it is no longer sufficient to say that change is inevitable, necessary and good; this old adage is giving way to a brand new one, which says disruptive change is inevitable and disruptive change is necessary and good. Whether one accepts it or not, digitalization is here to stay; its scope and applications are increasing at a scary pace. Our industry is moving from a Transformative set of relationships to a Collaborative set of relationships where one party does not use its position of strength to transform the way the second party operates its business but collaborates with the other to enable a win-win situation for both. There is a clear movement from information being passed and decisions being made on the basis of ‘TRUST’ to the same being made on the basis of ‘TRANSPARENCY’. Earlier, one made decisions based on what one’s business partner informed – systems are fast changing whereby information available with the Supplier is also available with the Buyer, and the same is available with the Shipping Agent or the Warehouse. Simply put, information available is transparent, not subject to interpretation or trust or judgment. Linear Fashion is giving way to Circular Fashion. Design, Make, Use, and Waste is changing to Design, Make, Use and Reuse. Fast Fashion is likely to change to Sustainable Fashion. For years, Buyers kept looking for newer Watering Holes – the cheaper, the better. But these options are getting lesser and lesser. The watering holes are getting scarce. Even though the Western buyers shifted to countries like India, then to China, then to Bangladesh, and now to Vietnam, Ethiopia, etc., at some time, the CHEAPEST sources are bound to dry up – to be replaced by the FASTEST, or NEAREST sources. Because fastest to market is becoming far more important than cheapest to market. RESHORING is likely to play an increasingly important role going ahead.
Considering all of the above, some things will not change – Buyers will continue to dominate Suppliers, and Offline Retail is not going to disappear anytime soon. With all its technological advancement, Online sales still constitutes less than 10% of apparel sales in the USA. Whether in business or in life – a win-win relationship is the only relationship that is sustainable. A one-sided situation may last temporarily, but unless the dominant player also thinks about the welfare or well-being of the weaker partner, the relationship or the business model will not last.
As I noted earlier, this year’s IAF World Fashion Convention was an excellent event and a wonderful experience for all who attended. The content was meaningful and important for all countries, exporters and importers alike. The next year’s convention will be held at Lahore (Pakistan) in the month of November supported by the Government of Pakistan, the ministry of light industry, and will be organized by the Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA).