Closing fashion's sustainable product data gap
Product data is becoming an increasingly important necessity for brands to collect, manage and use due to a growing global supply chain and forthcoming industry regulations. Learn more about the challenges, solutions and impact of the product data gap facing the fashion industry.
The growth of global markets has turned fashion’s supply chain into a huge and complex web. Combined with the acceleration of upcoming regulation, brands that lack the proper data will face an incredibly costly problem. Regulation is set to require granular levels of product data management, item-level traceability and data exchange across the circular value chain. So where exactly do we begin in the quest of fulfilling data gaps and ensuring accessibility and compliance? This month, we’re taking a closer look at what exactly these critical data gaps are, and what can be done to resolve them.
Why should brands care?
A wave of sustainability-focused legislation is now requiring brands to share comprehensive product information with consumers, and the ability to collect, organize and broadcast product data has become an essential. In Europe alone, 16 pieces of legislation are heading toward the (previously largely unregulated) apparel industry. Lack of compliance will become incredibly expensive for brands with legislation such as France’s Loi AGEC and the EU’s Digital Product Passport set to include potential penalties. These penalties could be sizable, and the tax suggested for the proposed EU amendment to the Waste Directive suggests a €0.12 / per item for products that don’t promote circularity, such as being reusable, durable or repairable.
Could your business absorb a €0.12 tax / item?
The challenge: accurate data capture and management
There are gaping blind spots when it comes to visibility into the supply chain, and those gaps get bigger as you look downstream. For many companies, very little data currently exists, and that data isn’t linked to the physical product – preventing end-to-end traceability of products and materials. When data is captured, data management presents a second challenge. Product data is often located in disparate systems or lost in spreadsheets, which makes critical data-exchange with value chain stakeholders highly resource-intensive. At this year’s Global Fashion Agenda, Aude Vergne, Chief Sustainability Officer at Chloé, discussed the challenges in closing the sustainable product data gap and the imperative of digital twins and multi-stakeholder collaboration to close the gap:
“The complexity lies in the fact that it’s a really [collaborative] project both internally and externally. You have to align everyone to share common goals to keep them advancing. Externally, we have to work with all of our suppliers and manufacturers [with] hours of interviews and discussions, convincing [them] to work in ways that they usually don’t. Internally, the project involves every department in the organization from design and product development, supply chain and sustainability, clients and digital - everyone.”
- Aude Vergne, Chief Sustainability Officer, Chloé
The solution: A digital ecosystem for product data exchange
Innovations within the apparel manufacturing space have made it possible to trace materials and validate claims using a mix of chemical, biological and digital technologies. This data can be captured and stored using Product Digitization platforms, and linked to unique, physical items using data carrier technologies such as QR, RFID and NFC. Product Digitization platforms securely record item-level events across the entire lifecycle and provide a secure, centralized cloud-based repository for efficient data exchange through APIs.
The impact: true sustainable business model transformation
Access to product data throughout the value chain not only allows companies to comply with regulations and avoid fines, but also unlocks circular business models such as resale and recycling. For example, the brand, product description and original MSRP (Manufacturer's Suggested Retail Price) could be efficiently accessed by resale partners; and material composition and finishes could be accessed by recyclers. By filling the data gaps in their system as a first step, brands now have an opportunity to capitalize on this data, and unlock operational excellence, new intelligence and profitable new services.
Read on for more on the topic in our sources below:
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