The fashion supply chain must accept that digital adoption is the only way to survive!
Coats Digital was formally launched in September 2019, as a unique, multifaceted business offering, incorporating the integration of three acquisitions – GSD, FastReact and ThreadSol. It is the software business of Coats Group, the world’s leading industrial thread company and a trusted industry player. In a conversation with Fibre2Fashion, Coats Digital’s Managing Director Akash Shah explains how the company has proved to be the key catalyst for fashion supply chain industry change, by playing an instrumental role in its digital transformation.
Why is digital technology and software imperative for any fashion brand today?
If we think about the important priorities of speed to market, agility, efficiency and sustainability along with the everchanging supply chain disruption, we simply cannot get there in a manual way. Technology brings data visibility and transparency to the forefront. This drives high-value insights that enable better decision-making and ultimately, step-changes business performance to the next level. Traditional methods that rely solely on gut feelings are not going to help take businesses forward, nor build the necessary operating excellence that brands and consumers are increasingly demanding. In a nutshell, technology enables businesses to act with greater speed and agility, while also lowering costs, to ensure they can remain competitive in a notoriously cut-throat environment. Brands are asking for more to meet the needs of tomorrow. Legacy manual methods are not going to pave the way for a more sustainable future that also adequately meets other changing consumer demands. The rapid adoption of 3D technologies throughout the COVID-19 pandemic is a great example of how both brands and manufacturers realised just how much technology is necessary to solve critical needs in a short space of time. Regardless of whether the focus is on speed, cost or creating operating excellence, technology has been vital to overcome obstacles and achieve workable solutions. Digital is, consequently, the only route to improving agility, speed to market and efficiencies that will not just strengthen a fashion supply chain business, but will, ultimately, ensure its survival.
The making of an apparel is a long process beginning from sourcing raw materials till it is sold to the end consumer. How does digital technology and software help in this journey?
Digital technology significantly helps when it comes to streamlining processes. Are you continuously driving operating excellence? Have you implemented best practice processes? Do you have data visibility? All these factors ultimately drive better decision making, and improved operating and financial performance. Think how much you can save and how much better it is for the environment (i.e., less waste), for instance, by optimising the cutting area and buying less fabric? Or the myriad of positive outcomes that could be realised by improving your SMVs through implementing best-practice methodology and processes? There is nothing to lose. Your cost base reduces – your speed and flexibility increases – all because of taking onboard the mindset to go after operating excellence through technology and digitalising core processes.
Speaking from a brand perspective there are several challenges including supply chain hurdles, garment costing, production efficiency, managing inventory, etc. So how does Coats Digital help overcome these?
That’s the conversation we are currently having with brands, along with their supply chain partners. They go hand-in-hand – especially as we are now seeing a greater emphasis on more strategic relationships between brands and manufacturers. Brands often have a ‘manufacturing excellence’ team which is accountable for helping the manufacturers achieve better visibility, increase operating excellence, and ultimately improve their business – which directly helps the brand meet its goals at the same time. We work with brands to influence their supply chain partners, so they can evolve to effectively meet what the fashion industry requires. We’re also particularly well-positioned to help solve the brands’ own sourcing pain points – whether it be product development, planning or costing. Given our in-depth and embedded expertise on the manufacturing side of the coin, imagine what’s possible when we not only connect the dots across the elements in the manufacturing supply chain, but also on the brand side of the equation as well.
What made the world’s leading industrial thread manufacturer to venture into technology and software?
At the end of the day, it’s all about creating exceptional customer value in the fashion supply chain. Coats Group already does this through its product portfolio built upon our strategic pillars of digital, innovation and sustainability. The question was how do we create another business line that can also deliver such value to the same customers. The foresight was that digital was, and is, - the future. The end result was a decision to build a technology/software business that serves these very same customers, and successfully delivers 100 per cent on our strategic pillar of ‘digital’. We, consequently, acquired GSD, FastReact and ThreadSol over the past five years to create the foundation for this new business line to build a robust, multi-faceted ecosystem of best-in-class technologies that enable brands and manufacturers to solve critical pain points seamlessly.
I took over Coats Digital just over a year ago to integrate the acquisitions into one business, one organisation, one culture, one strategy. The focus has been on establishing our one “Connected” Coats Digital purpose, vision, mission and strategy; transforming the operational (structure, capabilities, investments); and operationalising the ecosystem strategy to deliver rapid growth.
How has industry accepted the evolution of Coats Digital since its inception?
We’re just starting to get the Coats Digital name out there as one unified business. The feedback to date has been extremely positive, illustrated by the high customer adoption, testimonials, and testament that they now have one partner that has that rare combination of industry depth and technology expertise to solve their key pain points across the supply chain – not just specific, select areas. The industry knows FastReact and GSD as being the “go-to” solutions for solving planning and costing areas in the supply chain. We are now building upon this fantastic heritage, adding on fabric optimisation from the Threadsol acquisition, and establishing key strategic partnerships like the one we have with Res.Q, to develop the essence of Coats Digital. Essentially, we have taken the acquisitions and evolved the solutions forward and further to the latest tech stack while also enhancing the value proposition across the portfolio, all under one umbrella, which allows us to disrupt the market as one cohesive organisation solving multiple critical business issues in the fashion supply chain.
What message would you like to give to your prospective clients for investing in a technology like yours?
First and most importantly, it’s about mindset. Manufacturers and brands need to realise that digital transformation is a must, regardless of the partner or solution. To realistically move forward, to be competitive, to create operating excellence, and to create competitive advantage – you’ve got to invest in technology. The possibilities are there financially, operationally, and from a talent enablement perspective. There are enough use cases and customer testimonials out there to give that confidence. The key message is to be open to the fact that doing what worked yesterday isn’t going to work tomorrow. The only real questions are – what to tackle first? And who to partner with? …for a strengthened technology roadmap and the successful digital transformation of your core processes.
Which major manufacturers and retailers are currently your clients? Which of your products have these companies majorly invested in?
We’re quite far entrenched with both FRP (Planning) and GSDCost (Costing) – areas where both brands and manufacturers have prioritised their digital transformation phases. In general, digital transformation across the value chain, advances further from there. However, since the COVID-19 disruption, we are witnessing a desire to expedite technology adoption significantly, and this has meant digitising processes across the value chain with even greater speed, incorporating fabric optimisation and shop floor execution areas, at the same time. The winners will be those that take bold steps forward and quickly. Speed is of the essence to build strength, and competitive advantage, as well future-proof processes effectively to mitigate risk in a consistently uncertain world.
Whom do you consider your close competition?
I prefer to speak about collaboration vs. competition. There are various global and local players in the market experiencing different stages of their journey and focusing only on specific parts of the value chain. I believe we can create enhanced value for the industry by collaborating across the value chain. For example, Coats Digital plays across the end-to-end fashion supply chain from design and development to method-time-cost optimisation, production planning and control, fabric optimisation and shop floor execution. We have a long heritage and market position in the Costing (GSDCost) and Planning (FRP) areas and chose to create a strategic partnership with Res.Q to complete the full loop with shop floor execution. Naturally, it’s important that solutions are on the latest tech stack to facilitate optimum collaboration.
Do you foresee any challenges for the future?
There are always challenges, and this is what makes life and business growth opportunities interesting. Challenges continue to be there every day – whether it is the “talent crunch”, innovation at speed, or technology adoption, hurdles will always exist, especially in an industry that is at the early stages of its digital adoption curve, requiring further education, comfort and managing shifting priorities. What we have to ask is how can we get to where we want to be fast enough? And how can we innovate ahead of the curve? The key point is that we keep our overarching Purpose and Vision as our North Star. That drives us forward and ensures we are thinking and acting in the long-term to disrupt effectively so that we bring the industry forward into the digital age. Sense of urgency, speed, proactiveness and a true obsession to create customer value drives our teams to ensure we are the catalyst for this revolution and the de-facto digital transformation partner for the industry. We’re making real positive change happen which has been long overdue in this industry. For us at Coats Digital, challenges are merely masked opportunities to fully explore and find meaningful solutions for.
Are your products a one-time buy solution or they need to be refurbished every now and then?
Technology solutions are continuously being enhanced, and those enhancements are typically part and parcel of our partnership strategy – whether on a SaaS or On-Premise/AMC pricing model. Technology will continue to innovate, and we nor our customers can stand still. We continue to build, develop and enhance the very best solutions available to deliver an optimum, connected proposition, and are ramping up our efforts to accelerate positive industry disruption that enables companies to gain operational excellence immediately in the now and for the future.
What all technologies would you suggest for a sportswear manufacturer?
Retail analytics and consumer insights primarily drive views on demand requirements for brands. This then drives supply requirements from the brand, which moves us into the fashion supply chain phase – from “Plan to Pack” – from when brands ‘plan’ sourcing requirements to when manufacturers ‘pack’ goods – and includes all other phases in between. This is where Coats Digital focuses its attention – digitising core processes across the end-to-end fashion supply chain. Technology in each area makes sound operational and financial sense. The decision on where to start ultimately depends on each manufacturer’s own key challenges and pain points. That’s why it is so important for us to set up an initial discovery session to carefully assess the customer requirements before making any recommendations. Our goal is to ensure we can make a real difference and deliver outstanding customer value, from the onset.
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