One of the biggest learnings of the past two years for most businesses around the world is the importance of digitalisation as working in a physical and manual dependent world is no longer possible. It’s not only about beating the virus and following protocols which make operations in a physical context difficult, but also about the changing nature of expectations along the supply chain, including the end customer. And in all honesty, the world has changed for ever, so those who do not accept, adapt and adopt to the changed dynamics are destined to be left behind in a highly competitive and fast evolving business environment. In such a scenario, companies that have responsive solutions have done exceptionally well in the past 12-18 months and are now not just chasing trends, but integrating with evolving trends to support industry as the trends evolve. One such upfront company is Blue Kaktus led by tech-savvy Gunish Jain, who passionately believes that they are not a software provider but an industry insider offering real time solutions!
Blue Kaktus is already a well-established name in the textile value chain, specialising in business optimisation solutions through their AI based technology platform that enables companies to reduce costs, have a faster speed to market and improve productivity across the entire fashion value chain (right from yarn to retail store). “What really differentiates us from other similar companies is the fact that the genesis of Blue Kaktus lies in the industry having been born as a solution company to address pain-points that our apparel manufacturing company Akriti Apparels was facing working in the global fashion supply chain,” reasons Gunish. He adds that when discussing with clients, the approach is not to sell software but solutions to enhance business by understanding each individual company’s specific need and then offering a solution from their vast range of modules that directly targets the need.
Like everyone, Gunish admits that the industry has changed for ever and the company has actually benefited from the trends in the fashion supply chain that makes visibility very critical to survive and grow, more so as traceability becomes an essential requirement of sustainability agendas. “Digitisation is no longer a fancy tool to impress customers, but an absolute necessity to ensure quick reaction time from vendors and add flexibility to operations,” says Gunish. The success that Blue Kaktus has seen can be gauged by the fact that there are as of today 2500 vendors on the platform, which will reach 6500 vendors by June, when onboarding of current new projects is complete; clients include retailers like Arvind Fashion, Aditya Birla and Blackberrys to name a few. “We have grown tremendously in last 18 months and are picking up customers globally. I can say with confidence that as of today, we are the largest supply chain platform for this industry in the world and around US $ 130 million worth of sourcing is being conducted every month on our platform,” avers Gunish.
As buyers reduce global office presence and let the vendor take responsibility, transparency in real time for monitoring is a reality moving forward. Being so closely related to both the buying and manufacturing side of the business and watching trends unfold at close quarters, Gunish shares the four big trends he sees becoming predominant in the next 12 to 24 months, and for which both retailers and manufacturers have to gear up to remain/become competitive. These are of course in addition to the need to be a responsive nimble supply chain, which is in fact the end solution for all trends.
- The emergence of Micro brands – While national brands have their own fan following, the pandemic has given rise to customised brands centred around influencers to tap into their follower base. These brands are created in conjunction of the influencer and the type of following he/she has. This has become critical as retailers are no longer looking to invest in huge big order single brand collections as the risk factor and chance of inventory overload is higher in the traditional fashion supply chain, as customers are very unpredictable in their choices. Many of the micro brands are growing big and could after few years become national brands offered outside the influencers following base.
- Traceability, circularity, reverse logistics, reuse etc. – These are no longer just concepts and brands are now looking to bring back garments sold in Western markets to the manufacturing destination to be recycled and recreated. This will require strong technology platforms to tie in the loose ends of the supply chain including logistics and also meaningful digital collaborations along the supply chain for seamless transit of the products at all stages, irrespective of the brand they originally stand for. These platforms using technologies like blockchain and vendor management modules will ensure credible traceability that will do away with certifications based on manual verification.
- Simplification of styling – The trend has already taken root and with hybrid work culture, we will be seeing more of core products and less of fashion. This also means that lesser garments will be bought. The two main offshoots to the trend will be quick replenishment of fast-moving products and smaller order sizes, but a greater number of styles. The requirement here is of a very nimble supply chain where standardised raw materials like fabric, accessories are available at short notice on a single digital platform. The technology platform like the replenishment module with Blue Kaktus will have on board green channel vendors where inspection is not needed so that requirements can be met seamlessly with quality norms untampered.
- Nearshoring – Though the industry feels that it is still a very small portion of the business, it is a reality in case of high-end products. Brands are already shifting products wherein price is not a big issue and speed to market is more critical. No brand wants to guess how a US $ 500 garment will work, so small quantities are made nearby and then based on response, repeat orders are placed. In such businesses, everyday nearly 500 POs of 10-50 pieces are placed. A lot of automation is happening for this because it is not possible to do manually. Though this trend is only in the upper crème products and US $ 3-10 mass products are not going away from cheaper destinations, but for India it is a loss as such orders had started coming into the country.
Gunish is very confident that Blue Kaktus has a very important role is supporting the industry to address these trends and challenges that could pave the way for long-term growth. “The industry messed up the opportunity in 2004-2005, when the quota regime was abolished, now I feel that the industry has a two-year window to grab the market, provided we play it right.” he argues. What gives him the confidence to believe in the industry is the evolving mindset of the new generation of entrepreneurs, both coming from garmenting families and the new ones who entered in the last 15 years. “In the phase post quota, the industry was used to huge profits and could not apprehend competitiveness. A generation has changed and 80 per cent of the players post quota are out and those remaining are more professional and committed. Then there are those who entered the industry in the last 15 years and are willing to take risks and invest in the right technologies, but again, consolidation will happen to bring forth the most competitive. Another positive is the hugeness of national retailers and their growing influence that will support the industry in transformation unlike the last time,” concludes Gunish.
