How the Fashion Industry Is Using Blockchain Technology To Reinvent Itself
The fashion industry has always been one of the most demanding and competitive sectors in the world. It can be difficult to detect any parallels across brands and designers as they attempt to distinguish out from the crowd and put their own distinctive twist on trends and fashions.
And in today’s fast fashion world, where practically everything is created as inexpensively as possible and shipped to you within days of its creation, it can appear that every brand is nearly identical to the next… That is, until now.
A Brief History Of Fashion
The development of fashion design as an artistic expression and a form of creative art. It is credited to Francesco Albani in 1796. He was a Roman artist, who was into various painting styles, but he is best known for his fashion drawings. He brought his love and passion for art from Rome to Paris, where he became one of France’s most influential artists during his time. The term Haute couture appeared for the first time in 1826 in France. It referred to high-quality dressmaking that used luxurious fabrics and detailed embroidery.
In fact, Haute couture remains popular today, focusing on custom-made clothing created by hand from start to finish. In America, ready-to-wear fashion made its debut at New York’s Seventh Regiment Armory in 1913. It featured clothes created by famous designers like Paul Poiret and Jeanne Lanvin. However, they were only available for purchase at select department stores. This is because they weren’t sold directly to consumers until after World War II. Today’s technology has changed everything about how we live our lives – even how we shop!
Supply Chain in Today’s Fashion Industry
Before blockchain, there were no real solutions for a problem plaguing fashion for years. And that is a result of the fact that intermediaries have too much power in today’s supply chain. They can leverage their market dominance to drive prices up and take a hefty cut on all transactions.
As was recently exposed by The New York Times, they have time and again played a part in perpetuating modern slavery throughout global supply chains. Until last year, thousands of companies (including Nike) who pledged to rid their supply chains of forced labor continued to purchase clothing made through such practices until last year. How is blockchain helping with these issues?
Today, it’s almost impossible to know exactly where your clothes come from or how they produce them. But blockchain technology could change that by creating a decentralized ledger system where data about each garment’s origin would be stored securely and transparently. This way, consumers could see every step along the way, from raw materials to the final product. And if you want more transparency than that? You can even choose to share your information with other consumers! What we get out of it is a more trustworthy industry overall. What brands get out of it is more trust among consumers and fewer PR disasters like those faced by Zara over recent years.
3 Ways Blockchain Technology is Transforming the Fashion Industry
If you are looking for a way to reduce counterfeiting and fraud in the fashion industry, then Blockchain technology is a great option. Blockchain technology can help align teams within a fashion brand so that no one loses a record. In addition, it saves days and even weeks because a single platform can trace the entire production chain. Here are three ways Blockchain technology is transforming the fashion industry.
Blockchain Technology can help Reduce Counterfeiting and Fraud
In the world of counterfeit goods, the impact on the economy is considerable. The value of counterfeit goods was about $461 billion in 2013 or 2.5 percent of the global imports. Counterfeit goods are unsustainable for the economy, but they also threaten the livelihood of millions of people. In fact, if these trends continue, counterfeited goods will threaten 5.4 million jobs by 2022. With this in mind, companies are turning to blockchain technology for a more transparent supply chain.
Blockchain technology is an appealing solution as the fashion industry works toward greater product traceability and supply chain transparency. Blockchain technology can help companies prove the authenticity of their products and create greater transparency related to the environmental focus. In addition, fashion brands have more interest in proving the authenticity of their suppliers.
In this way, blockchain technology can protect companies. Furthermore, as more consumers shift their purchasing habits towards sustainable products, more companies will adopt the technology.
In addition to preventing product piracy, blockchain can also reduce damage caused by counterfeited goods. The amount of damage caused by counterfeited products amounts to 10% of a company’s revenue. FC3 is part of a government-sponsored blockchain project. The government’s push to implement blockchain technology aimed to protect the Made in Italy label.
Align Teams within a Fashion Brand
Implementation of blockchain technology could be a significant step forward for traceability and efficiency along the fashion supply chain. However, two main groups of obstacles prevent its full implementation. The first group is a low level of understanding of the emerging technology within the fashion industry. Consequently, it views itself as not yet ready for the technology from a technological and cultural standpoint. The second group of obstacles is the lack of collaboration between stakeholders in the industry.
TextileGenesis, a blockchain startup, is already testing this technology with 120 customers in Bangladesh, Pakistan, and India. Florian Heubrandner, vice president of global business management at Lenzing, says the tech is beneficial to brands because it provides transparency and helps them meet sustainability goals. The company plans to work with other brands, manufacturers, and suppliers in China and Bangladesh. Further, the technology can be used to track products’ origin and ensure that the clothing they buy is of high quality.
Another group of problems faced by fashion brands is proving worker welfare to the industry and authenticating resale luxury items. Blockchain development can help fashion brands overcome these problems. In addition, it can help them achieve their sustainability goals while maintaining quality, margins, and revenues.
Designers can sell directly to customers without going through traditional retailers like Amazon or Macy’s. The inventory stays with the designer until a customer buys it. So there are no extra costs when producing clothing upfront. The designer simply sets their price, creates an item using something like Adobe Photoshop, and uploads it onto an e-commerce platform. Once they make a sale, they earn money on every sale without worrying about third parties taking cuts along the way.
Blockchain also helps because transactions are secure and can be tracked throughout their lifecycle. This makes it easier for brands to trace where products came from and whether they were made ethically.
For example, if you buy an organic cotton t-shirt from a company that sources fair trade cotton, you can be sure that your purchase will benefit people who work hard for what they have earned. In addition, if your t-shirt gets damaged or lost during shipping, you can use blockchain to track down exactly where it is so that someone can deliver it back to you as quickly as possible.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
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