The pandemic has exposed the fragility of fashion’s global supply chains and the subsequent inventory excess that current production models can cause. BoF’s State of Fashion 2021, produced in partnership with McKinsey & Company, reported on the worsening of the fashion industry’s inventory glut, with inventory turnover falling 33 percent in the first three months of 2020, and orders down nearly a third year-on-year by the end of April.

Founded in 2015 by Ben Demiri and Gonçalo Cruz, and counting Farfetch’s founder and chief executive José Neves as a co-chairman, technology company Platforme seeks to empower brands to transition to made-to-order production methods — allowing consumer demand to guide output and, in turn, promoting more efficient practices and tackling overproduction.

Fashion executives are expressing intent to transform the supply chain. Indeed, 60 percent of fashion executives in the BoF and McKinsey State of Fashion 2021 Survey plan to implement improved analytics for consumer insights and 43 percent planning to reduce product development lead times to avoid overstock.

Platforme offers technology solutions that work across all facets of the fashion value chain. From 3D digital product creation — supporting both product conceptualisation and consumer experience — to software that orchestrates selling, production and product distribution, speeding up the successful samples reaching the shop floor. Today, it is trusted by the likes of Gucci, Pangaia, Puma, Dior and The North Face to provide these solutions.

Now, BoF sits down with Platforme CEO Gonçalo Cruz to discuss innovative inventory solutions, customer-centric production and streamlining “e-fashion” into the entire supply chain.

What factors are driving the adoption of demand-driven manufacturing?

Before direct-to-consumer and online sales, the processes and cycles of fashion were essentially found within the pillars of seasonal collections — a long cycle connected to wholesale and retail activities. The feedback that the business model provided to brands and designers was slow — maybe six, eight or ten months after you had created something. However, with the shift to the real-time feedback that social media, the wider internet and e-commerce generates, you have an immediate sense of what will work or not.

If you have this super active feedback loop but super long production cycles, something is drastically wrong. We keep producing, even today, in line with the wholesale and retail model. The average time-to-market depends on the price point but it’s typically between 40 and 60 weeks. The industry has piles of stock that needs to be discounted, repurposed, or is [wasted] because it hasn’t been accepted by the market.

If you have this super active feedback loop but super long production cycles, something is drastically wrong.

In the 1990s, it would be relatively common to find a brand with 80 to 85 percent sell-out ratios at full price. Nowadays, if you find a company or brand that sells 60 to 65 percent of its stock at full price, they are doing an incredible job. Having a business that is fundamentally accepting heavy discounting for a third of its stock and then faced with destruction of stock, raw materials and finished goods is a massive issue.

How have the use cases for Platforme’s technologies evolved since the pandemic began?

The core technological platform is pretty neutral, but the use cases are constantly changing tune in line with products, focus and client type. Obviously, we need to adapt to real market activity and, with the pandemic, we have seen that excess stock was and is a significant challenge. Second is the acceleration in the adoption of 3D. We’re teaching brands that 3D is not for product development — it’s for everything and the pandemic has encouraged further take-up.

Now, pandemic-induced product shifts to comfort and basics have seen us create a task force internally just to focus in those categories. We supported a big client in a production [pivot] as they essentially parked activity, because no one was buying a blazer. We’ve run two big bets, one again, in the e-fashion space, on hoodie and sneaker projects and, in the supply chain, we’ve been finding more and more factories that are specifically capable of doing those product categories.

How does Platforme tailor its offering to suit business type and size?

We have created technological modules that can resonate with every single specific client, working almost like an agency within the e-commerce space. We want to be completely democratic. We want to be relevant for both mega brands and for new, emerging designers that are just starting their own business. We’ve created this matrix to be relevant for all the cases.

Smaller SMEs are typically focusing on speed to market — launching things rather than having a unique, bespoke experience. They prefer it to run on generic e-commerce engine such as Shopify or WooCommerce, and prefer to use our modules that already exist for those commerce platforms — it’s literally plug and play. In just a few days, you have set up your account and you have a new style, or a new collection, powered by Platforme with no major integrations or bespoke developments.

However, with some bigger clients, we know that they will prefer to utilise our API rather than our off-the-shelf interfaces. We know that they will want to have their voice, look and feel, developing their own experience on top of our technology.

Brands are still adopting 3D as a tool to help product development [...] It’s much more powerful than that.

In terms of price points and product focus, it’s completely different to work for a luxury house that focuses on leather goods and high price points versus a smaller company with volume price points that are focusing on t-shirts and sweatshirts. In the end-to-end approach, we consider which factories we would bring to each specific case. We don’t adapt the technology but we adapt the partnership and the type of teams that work on a specific project. We have built an interesting adaptive model, addressing case-by-case needs and being as relevant and as optimised as possible.

What are the new use cases for 3D product imagery? How have they evolved?

Utilising 3D to sell is still a new and compelling strategy. Some brands have begun to experiment — one specific style, one specific drop in 3D — but, up until now, I haven’t seen any brands utilising 3D at scale to showcase a digital window of their product offering. Brands are still adopting 3D as a tool to help product development, like sketching, playing around with options, interacting with what’s feasible or not. However, 3D is much more powerful than that.

Every single brand is using physical stock to sell and those samples require physical raw materials, water, energy, physical labour, logistics. Using 3D can drastically reduce the amount of physical goods needed in that selling process.

Beyond this, at Platforme, we have created a specific unit internally just to identify those opportunities. For instance, we are working within the [realm] of digital fashion for video games and immersive concerts. Earlier this year, we created the outfit worn by Madison Beer within her digital concert powered by her label and Sony. We want to support those incredible new use cases, but if we need to focus on one thing to make an impact, let’s start by utilising 3D, not just as a reference for product development, but also to start as a key sales tool.

How do you expect demand-driven production to evolve in the mid- to long-term?

I believe that the industrial model will change in many ways — some that will feel slight and some that will be entirely disruptive. First, nearshoring production with smaller, agile factories will become common. For this to work at scale, we will simply need fast, localised factories with just 20 or 30 employees. From Covid-19 to carbon consumption and trade wars, the world is becoming so unpredictable that having things managed is unlikely to give you the reactivity that you need to serve your brands and your clients better.

Second is this evolution of the application of technology — having more digital experiences connected to sales. Physical stores will be managed by the same engines that are powering e-commerce, with stock reactive to market feedback, so we can have smarter ways of predicting what we need to accelerate or decelerate in all senses, from new machines to new raw materials or reducing labour capacity.

Saying, “I trust that we will sell 10,000 t-shirts next season” is a financial and environmental risk. Smarter prediction models with AI tools that learn over time will be much more powerful that having silos that command a source of truth.

Now is the time to prove that this works at scale and it’s not just made for specific price points or specific large companies. It should be democratised. We want to be leading that space, opening the industry to the capacity and the viability of all of this. It’s early days for this new process of consuming and producing fashion.

This is a sponsored feature paid for by Platforme as part of a BoF partnership.