Spotlight with Amit Gautam, CEO/Founder of TextileGenesis™
With 80% of consumers wanting fashion brands to source from transparent supply chains and up to 30% of branded ingredients such as organic or sustainable fibers discovered as fake, the company TextileGenesis™ serves as a new platform to change all of that.
Founded by Amit Gautam, TextileGenesis™ is a by-product of intensive “grass-root” discussions with the leaders in the apparel supply chain. It is a blockchain-enabled digital platform that pushes transparency in the supply chain. The technology ensures the security of a brand, and combats fakes from fiber-to-retail, driving value-chain inventory optimization.
The start of the TextileGenesis™
During his time working as Executive Vice President, Business Management Textiles of Lenzing Group, Gautam noticed common feedback from fabrics, spinners, and textile industry professionals. This feedback of how to protect the business model of authentic players vs non-authentic is what sparked as the beginning of what came to be TextileGenesisTM.
In his time in the industry, various levels of supply chain and brands continued to ask the question: how can you ensure that they receive what they pay for?
As Gautam ruminated over the question, blockchain technology began to move from fintech into the supply chain. Rather than being applicable for cryptocurrency alone, he found its applications to the real business world incredibly fascinating. The thought of how we can actually start tokenizing the fibers at the point of origin and those fiber coins can pass along the chain as the textile moves along the chain was what inspired Gautam to explore the ideas of exploring token coins.
He then began to build the platform around that idea, spending a lot of time investing in understanding data modeling, data taxonomy, etc. Coming from a consulting background, it was natural for him to understand how the flow of data worked, thus believing in his philosophy: first, the data then comes the technology.
To Gautam, this served as one of the most fundamental important steps to starting the business, as he hoped to build a platform for the entire industry, not simply a few customers. For him, scalability is what stood in mind.
If you do not work on standardized data solution, there is no way you can build a scalable solution. You will not be able to drive scalability.
Penetrating the market
With business development based in London, headquarters in Hong Kong, and production running in India, Vietnam, and China, Gautam expanded the market with the hope of penetrating these major countries, as they served as key markets for the textile industry.
Hong Kong has always been known as a central hub for textile and apparel, and it remains as a global city for brands to connect, along with a great spot to expand the network across the supply chain.
Having established recent partnerships with Lenzing Group, Textile Exchange and Fashion for Good, Gautam moves forward with the company with hopes to continue working with pioneers of sustainability. He believes that it is important to get involved with these players, as they are the ones who push the envelope of the whole industry.
The challenges of changing minds
When it comes to the challenges that Gautam experienced in his journey, he found that one is the ability to educate the market on why existing methods do not work. The pace at which things have been changing in the textile industry has been much slower in terms of adoption of new technology.
The existing transparency and chain-of-custody solutions are based on paper/PDF files, but this raises concerns as they can be counterfeited and duplicated, yet even so, the industry still relies heavily on these methods. As Gautam notes, there is a legacy system in place so when you are trying to introduce new technology, there is quite a bit of alignment between brands, supply chain, etc – thereby making the process of adoption longer.
Beyond that, the second challenge Gautam faced was solving the issue of how to drive convergence. He found that by having too many different solutions, things were not as scalable as hoped. This prevents the company from reducing operation efficiency due to each supply chain’s infrastructure, which is why he hoped to create a platform that could be used across every level.
There are certain legacy systems in place that they are used to. Trying to introduce something new requires a certain amount of trust, courage, and entrepreneurship spirit, and sometimes large companies could be risk-averse. They want to see if it is successful with others first.
The future of fashion and technology
In regards to new technology such as AI in fashion, predictive analytics solutions can help better understand the consumer. Brands will be able to target specific granular consumer segments and reach out to them more proactively and lower their cost of acquisition. Areas in the supply chain need more transparency and with the implementation of machine learning, this can become closer to reality.
There is a tremendous amount of waste, where roughly 40% of garments are never worn by a consumer due to being overproduced. With predictive analytics, companies can help improve, mapping production to demand.
Moreover, when it comes to how new technology as a whole will change the textile industry, Gautam believes that the following areas are worth considering:
- Customer-Centric Interface – The point of focus that many retailers will need to start considering is how to engage the consumer and create that connection between them. Using consumer data can help companies better understand what their customers are looking for, but can also help to completely redesign the retail stores.
- Material Innovation – More retailers will begin to get more sustainable raw materials and the entire supply chain will become circular. Questions like how we can use garments that are at the end of life, rather than sending them straight to the landfill are things companies will need to respond to. Resource efficiency is also key, where companies will have to – more and more – ensure the materials used are either ‘circular’ or renewable.
- Supply Chain Mapping – The idea of transparency and sustainability will only strengthen. The two are deeply connected. Sustainability has become mainstream, and with it comes a push for transparency. This being applied throughout the entire supply chain is where technology can play a tremendous role. By making it more transparent, it will naturally make it more sustainable, both environmentally and socially.
Sustainability is another important thing to be wary of, and as Gautam believes, it is the continued future of fashion. The majority of the top 100 brands are increasingly announcing that their garments come from sustainable raw materials. Unfortunately, less than 5% of those brands can track the garments back to the raw material. On one side, you have a very foundation, but on the other hand, you don’t have the processes and systems in place to retrace the original back to the raw materials.
There is a deep paradox of transparency, as many have a strong ambition to make and be sustainable, yet there is no real system in place to make it happen.
When it comes to identifying the quality of the material used, most brands have the ability to identify Tier 1 to 2 (a finished fabric), yet have very little visibility from tier 3 and below. Gautam also notes that there are very strong movements around the idea of resource, efficiency, and circularity as a whole in the textile industry. The question companies need to ask: how can you reduce the input raw materials to produce your specific output?
Looking forward with TextileGenesis™
As for the future of TextileGenesis™, Gautam hopes to focus on expanding the brand and begin the commercial roll-out of the product by the end of 2020. As he continues to expand the base of the company, working with more players that are involved with sustainable fibers, he hopes to build TextileGenesis™ into becoming the authentication platform where brands and supply chain can verify their entire supply chain.
Using blockchain technology, Gautam aims to have secure digital custody to ensure everyone is getting what they are paying for in terms of raw materials and full transparency from supplier to Tier 5.
It’s all about creating that foundational base. Once the backbone of the supply chain is there, you can build other features that help environmentally.
In the coming year, Gautam hopes to introduce a transparency ranking that will be AI-based, measuring the quality of sustainability. It will allow brands to understand how different players perform.
When it comes to running a company and building a technology business in the retail industry, Gautam notes that some of the most important takeaways are to:
- Value for customers – Relentless focus on value creation for direct customers will help parameters change over time. Although technological adoption is slower than other industries, overall it is a fast-moving field, and so players who do not reassess whether the solution is actually addressing real business will fall behind.
- Don’t do it alone – One of the key components to entrepreneurship is forming partnerships. It is impossible now for a single company to do all the things at the same time. Forming important partnerships in the industry is a credible way to build scalability, so Gautam believes moving forward, people should never try to build alone.