From August 14-17, 2016, SOURCING at MAGIC took place in Las Vegas, bringing together thousands of brands, retailers, manufacturers, and experts to buy and sell for the year ahead, as well as discuss the future of the industry. This summer, the focus was on the future: sourcing trends and what’s next, the quest for sustainability, and how tech ties it all together—plus, what exactly is going to happen on November 8th.
Slow is the new fast.
The United States Fashion Industry Association (USFIA) led two of the most popular seminars during the week, bringing together fashion and politics. During “It’s Not Where You Source—It’s How!”, USFIA President Julia K. Hughes talked with three of the top minds in sourcing and sustainability about how they meet their customers’ needs on price, but also design, quality, and speed. And, today, the product must be produced in an ethical, sustainable way—even if it does increase the price.
Michael Kobori, Vice President of Sustainability at Levi Strauss & Co., spoke about Levi’s move from regional sourcing to a truly global, full-package strategy. Levi’s uses 40 percent fewer vendors today than five years ago, as they have shifted to building long-term relationships with larger, more capable vendors who can serve global needs. Sustainability is a critical aspect of the brand strategy, and Levi’s takes pride in “slow fashion” as opposed to “fast fashion,” making items that last.
David Miller, Senior Vice President at Hudson Bay Corporation, which includes Lord & Taylor, Saks Fifth Avenue, Home Outfitters, and other retailers, noted the change in how sourcing execs have become both product development and logistics experts. His company sources all over the world, as they aim to find partners who think like them, and who want to innovate.
Amy Leonard, Vice President of Sourcing for STITCHFIX, a start-up, direct-to-consumer company, takes a unique approach by using algorithms and stylists to match customers to clothing, which is shipped to them directly. When the company started, they bought items directly from vendors at MAGIC. Now, five years later, they use a combination of in-house, exclusive brands, as well as department store and name brands.
And as sustainability and compliance continue to grow in importance, other sourcing executives discussed how you can mitigate risks. Jeffrey Stone, Vice President of Merchandising & Product Development for Cabela’s, explained that the sourcing business is moving away from a centralized, “sourcing silo” mentality. Additionally, investing in the countries in which you’re sourcing, by opening offices on the ground with employees who speak the local language and understand the customs, can be a sound business decision.
And pretty much every sourcing exec we heard from during the week agreed: cheaper is not always better. Focusing on creating quality product, with vendors you know and trust, in a sustainable, ethical way, is almost always the better way to do business.
The intersection of fashion and politics.
From the sourcing discussion, we moved immediately to the topic we can’t ignore: politics. During “Washington Comes to Las Vegas!” USFIA’s Julia Hughes led a discussion with D.C. insiders on how trade policy and the election could impact sourcing and business decisions.
First, Bill Jackson, Assistant U.S. Trade Representative for Textiles, discussed the importance of the Trans-Pacific Partnership (TPP), explaining that the Obama Administration is still hopeful for a lame-duck vote at the end of the year. The sticking points in the agreement, like biologics and tobacco, have nothing to do with textiles or apparel, and all major associations representing both the domestic manufacturers as well as the importers support the agreement. Currently, the President, Senate Majority Leader, and Speaker of the House all support trade—but this is unlikely to be the case next year, so it’s important for Congress to act now. The Peterson Economic Institute estimates just a one-year delay will cost as much as $94 billion.
Jackson also touched on other topics, like the Transatlantic Trade & Investment Partnership (TTIP) between the United States and European Union, which has “flown under the radar” and largely been ignored while TPP has been lambasted in public discourse. The U.S. and EU are committed to reaching agreement this year, and are working on market access, to try to remove almost all tariffs upon entry into force. Of course, the Rule of Origin for textiles and apparel remains to be resolved, as the United States is still calling for a yarn-forward rule, while the European Union uses process and transformation.
Following Jackson’s remarks, Hughes sat down with USFIA Washington Counsel David Spooner of Barnes & Thornburg LLP and Jon Fee of Alston & Bird LLP. They agreed: the outlook for TPP’s passage this year is dismal, and think we’re looking at 2018, at the very earliest. Spooner explained how this could occur despite the fact that both presidential candidates have spoken out against trade. While serving in the U.S. Senate, Barack Obama voted against the U.S.-Colombia Free Trade Agreement. But, after being elected President, urged minor changes to the agreement, and proclaimed he “fixed it.” He sees the same possibility for Hillary Clinton, who he expects to win on November 8th, especially since she’s previously been pro-TPP and pro-trade generally. Fee agreed with this logic. Both, however, thought the Senate could flip Democratic, which could make TPP’s passage slightly more difficult. Join USFIA on November 9th, the day after the election, for our annual conference in New York City to hear more from Spooner and Fee on the results!
The future of fashion is now.
If there was one overarching theme throughout the week, it was the idea that tech is changing the industry—and as we’re now printing our shoes and wearing our tech gadgets.
First, technology is changing the manufacturing process. In a session moderated by Eddie Hertzman, Editor of Sourcing Journal and VAMP, we heard from Feetz, a shoe company that started as a tech company, uses 3D printing to create affordable custom shoes. The customer takes a picture of his or her feet, swipes left or right to see styles, and receives a completely custom shoe made with 3D printer technology. What if it doesn’t fit? The 3D printed material is 200 percent recyclable, and it can be recycled up to 20 times! For other companies, especially big retailers, returns are no longer a problem—but a solution, to get customers to come back into the brick-and-mortar store.
Second, technology is changing the experience of shopping for clothes and wearing them. New augmented reality websites create a virtual dressing room with a model of your body so you can see exactly how an item will look—and this technology is being brought into in-store dressing rooms, too. And then companies like Anatomic & Co. are creating shoes with chips that literally shut down your smart phone, forcing you to get off your device and interact with the humans around you.
Save the date! The next SOURCING at MAGIC will take place on February 20-23, 2017!
