Bangladeshi female workers work at a garments factory in Gazipur outskirts of Dhaka on February 17, 2018. Photo by Mehedi Hasan/NurPhoto via Getty Images
In the past, a lack of transparency in a company’s supply chain could be seen as a competitive advantage. Businesses wanted to keep insight into their suppliers and manufacturers as opaque as possible.
If no one knew where supplies were coming from, no one could build identical apparel. And this thinking extended to customers, out of sight meant out of mind when it came to worries about ethical sourcing and manufacturing in the fashion industry.
It’s clear there has been a shift in the way companies and consumers view transparency. Thanks to consumer trends and companies like Better Kinds that focus on decentralized manufacturing, it’s now an advantage for everyone to know where your clothes come from. People are increasingly demanding transparency, while companies like Patagonia and Everlane tout sustainability and supply chain transparency as a selling point.
But there’s still plenty of work to be done. Many apparel companies lack ethical supply chains, and a full 10% of global emissions are produced by the industry alone.
Fortunately, the blockchain has already begun transforming apparel supply chains through technology such as track-and-trace and inventory management. But as other technologies like 3D printing and AI continue to advance, the apparel industry may very well see much more dramatic changes.
Here’s how the industry is advancing and what’s to come:
Blockchain technology is already transforming the apparel industry.
The blockchain solutions in the industry stem from its unique ability to create a physical-digital link between goods and their digital identities on a blockchain. Often, a cryptographic seal or serial number acts as the physical identifier, linking back to the individual product’s “digital twin.”
This link offers opportunities for a more transparent supply chain. Every time a product changes hands, that change in custody is recorded on the blockchain. Counterfeit goods missing the physical-digital link are obvious, as are any attempts to divert goods. The chain of custody on blockchain provides a record of the last party to gain custody of the product, showing where the counterfeit product slipped in—or the authentic product was diverted out.
Greater transparency in supply chains will create new incentives for companies to change the way they do business and even how they view themselves as an organization.
Companies like Loomia are working on solutions to collect consumer data directly from the textiles themselves and register that data on the blockchain.
But truthfully, blockchain is only the beginning. The industry may be entering a new era with vastly different forms of production and consumption.
Companies have to rethink how they’re positioning themselves.
Millennials are not consuming as much fast fashion, and they tend to distrust spurious claims of sustainability.
Too many brands have been exposed as wasteful, environmentally unfriendly, or simply unethical. The backlash against fast fashion is evident in a younger generation less impressed with labels and happy to purchase vintage pieces that have stood the test of time.
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