On May 20th we looked to Colombo for the first in a global series of Serai webinars. The support we received was overwhelming, with hundreds of owners and executives from the top international apparel companies in Sri Lanka registering to join our online event.
At Serai we believe in the power of trusted relationships, and the powerful network that trusted relationships bring. That is why we launched this series - to bring valuable insights from our network to our markets, and assist brands & manufacturers across the world in making informed decisions. Check out the full recording and brief event summary below!
Covid-19 will be the catalyst that changes the fundamentals of the global apparel industry. Established ways of doing business have been disrupted, leaving buyers and suppliers to wrestle with difficult questions: What can I do to survive the current volatility? How can I prepare to emerge stronger in a post-Covid world?
The apparel industry has hit a turning point. The future will look very different from the present, with technology set to transform the way supply chains are formed and managed. For this event we brought in Vivek Ramachandran, CEO of Serai, Karl-Hendrik Magnus, Senior Partner at McKinsey & Company, Rakhil Hirdaramani, Director at the Hirdaramani Group and Rehan Lakhany, Chairman of the Sri Lanka Apparel Exporters Association, to discuss what lies ahead for the industry, and how we can all plan, individually and collectively, for a post-Covid world.
The impact of Covid-19 on the apparel industry is hard to exaggerate. All participants agreed that both buyers and suppliers are facing a wave of interrelated challenges. Karl-Hendrik explained that global fashion sales are estimated to drop 30% in 2020, causing many brands and retailers to close their stores due to financial distress. Brick and mortar business models are feeling the brunt of this shock, with significantly less footfall and a dramatic increase in ecommerce as consumers spend more time at home.
Karl-Hendrik outlined how this is hitting the manufacturing side as well, with as much as 50% of suppliers to European and North American fashion brands expected to experience financial distress over the coming six months. Rakhil emphasised this, recounting how supply chains in key manufacturing markets are fragmenting. This is causing a rapid increase in liability for manufacturers as well as a damaging loss of overall confidence. The apparel industry is facing pressing questions on how to rebuild trust and transition to more sustainable ways of doing business.
Recent events have forced manufacturers to experiment with remote operations and online engagement, marking a long overdue turning point for an industry so over reliant on physical interactions. These changes now need to happen at scale and be for good. According to Vivek “participants of the apparel industry need to find digital ways of working with each other. Relationships have to move online”.
The seeds of this transformation can be seen in the acceleration of technology adoption. Karl-Hendrik outlined a range of trends, with the usage of 3D design collaboration software and virtual prototyping technologies growing fast in the current crisis. Product sampling and approvals via video conference are also on the rise, as well as automated production technology to enable greater customisation.
“Participants of the apparel industry need to find digital ways of working with each other. Relationships have to move online.” - Vivek
The experience in Sri Lanka shows the value of a positive orientation toward technology. Rehan suggested that even before Covid-19, many of the country’s manufacturers had achieved a high level of digitisation. Affirming this point, Rakhil added: “Sri Lankan apparel manufacturers have an incredible digital IQ. Most of us have already moved into 3D prototyping and 3D fits”. As natural innovators and rapid adopters of new technology, the apparel industry in Sri Lanka has the right mindset and experience to recover and thrive in a post-Covid world.
The loss of confidence across the apparel industry has been so deep and far-reaching that new models for doing business are needed to rebuild trust. At Serai we believe in the power of trusted relationships, and that a digital means to connect buyers and suppliers is necessary for industries to thrive in a post-Covid world. Rakhil made this point strongly: “What we see is that the ecosystem needs to change…there is a pressing need for a neutral transaction platform”.
As the apparel industry prepares for the post-Covid world, the role of technology has become indispensable. All aspects of doing business, from sourcing to sampling, are set to be transformed. We believe that a neutral platform is essential to this process, with the potential to provide:
That is why we’re building Serai - a business to business platform where companies can showcase their business, connect with capable partners and manage their supply chain relationships. We truly believe that the future of the apparel industry lies in increased digitisation and the efficiency gains that all participants can draw from this.
Leading brands, manufacturers and suppliers are already using Serai to grow their business while shaping the development of our platform. Be part of this transformation - join Serai for free today.