At this year’s G7 summit in Biarritz, 32 companies banded together to sign the Fashion Pact, a commitment to solving one of the apparel and retail industry’s biggest problems: sustainability.
The fast-fashion sector has been a main contributor to the problem. With companies churning out more clothing on a faster production cycle, the fashion world now produces 150 billion garments per year. Without foresight into demand, many organizations end up overproducing, resulting in 30 percent of items going unsold and 12.8 million tons sent to landfills.
Luxury brands have been accessories to the environmental impact of retailing as well. To protect brand image, those like Burberry have historically sent unsold items to the incinerator. When these products are burned, they release carbon dioxide and other greenhouse gases into the atmosphere, further contributing to global warming.
How can organizations improve sustainability within their supply chains? One way is through the widely discussed technology of blockchain.
Blockchain Combined With Intelligent Planning Eliminates Overproduction
Blockchain provides a distributed ledger of all activities and transactions in a product’s life cycle — from sourcing and production, through transport to the retail level. The data is decentralized and visible to everyone on the network in real time. This transparency means people responsible for production planning, channel allocation, demand forecasting, and replenishment — upstream in the supply chain — can have visibility downstream into what consumers are buying at any given moment.
They can thereby better plan production numbers, manufacturing only the precise amount of stock to satisfy demand and thus eliminating overproduction. With geographic data, companies can send products to the regions where they’re in high demand to further minimize the likelihood of unsold stock sitting in stores only to meet a landfill or incinerator.
For fast-fashion retailers, luxury…