WFX is moving fashion to a digital, sustainable & transparent future
WFX - World Fashion Exchange is the world leader in providing digital solutions for the fashion industry. Founded in 2000, WFX provides a modern, comprehensive yet easy-to-use cloud-based suite of software solutions that includes WFX Cloud ERP, PLM, Smart Factory and Virtual Showroom. The company works with global fashion brands and manufacturers of all sizes to implement these solutions both as individual products and as an end-to-end digitally integrated system. In an interview with Fibre2Fashion WFX CEO Jatin Paul discusses how software and digitalisation will shape the future of fashion and apparel industry globally.
What role will Web 3.0 play in future for the fashion and apparel industries?
Web 3.0 is all about the decentralisation of information, blockchain and token-based incentives. For the fashion industry, this means that designers will have the opportunity to create a system of digital ownership for the first time through non-fungible tokens or NFTs. This in turn enables us to also trace the evolution of any product through the blockchain. Web 3.0 will bring better visibility, traceability and immutability as products flow through their supply chain. This will be a big boon for customers who want to know how the products are made, who made them and what the entire supply chain looks like.Going forward, Web 3.0 will play multiple roles in the fashion industry as we’re already seeing in the proliferation and adoption of digital fashion across video games and metaverses. This will be especially important as digital fashion becomes more popular. People will be able to buy digital clothes and accessories, then use those digital assets in augmented or virtual reality (AR/VR) environments such as video games, metaverses and more. We’ll see more brands experiment with digital-only clothing, digital replicas, and twin virtual-physical collections as well as setting digital store fronts, also called virtual showrooms. This will open a new door to experience apparel and give customers and brands to create immersive virtual retail environments. Thanks to this, technologies in the virtual try-on and sizing space will also grow much faster.The other aspect is the creation of new business models for digital fashion designers and creators who can use blockchain technology to sell their designs as NFTs via virtual fashion/NFT-specific marketplaces. This will allow designers to benefit from any future transactions of their products, as well as prevent counterfeiting.
What kind of revolution will Web 3.0 bring to PLM (Product Lifecycle Management), ERP (Enterprise Resource Planning) and other software solutions for the fashion sector?
I think the most immediate direct impact of Web 3.0 and blockchain on fashion-tech solutions will be on traceability and tracking capabilities. There’s rising demand for greater supply chain visibility and transparency in production from consumers and that demand is being relayed down to brands and eventually suppliers.
With blockchain-powered technologies, fashion businesses will be able to provide better visibility and traceability of their products, maintain transparency in their sustainability practices as well as certify authenticity of ownership to eliminate the rising problem of fashion fakes. Web 3.0 technologies will ensure immutable traceability of fashion products through ‘Product Passports’. These passports will enable consumers to verify any ethical or sustainability claims from brands.
The second big shift will be in connection with digital fashion products and how they interface in different metaverse marketplaces. PLM will be the place where these digital products will be ideated, designed and developed. For example, WFX PLM already allows you to link 3D design functions, so once your systems are linked, you can manage the entire product lifecycle of both your physical and digital products in the same place. The next step will be to link these virtual products to virtual metaverse stores which will give customers and brands new ways to visualise and test products.
What is the size of the market for fashion and apparel software globally? Which are your major markets?
The last few years have been quite dynamic for the fashion industry. In terms of the overall market for fashion and apparel software, a recent report valued the fashion-tech space at around $1.6 billion in 2021, which is projected to double by 2027.
We have also seen a fast-growing trend for digitalisation in the fashion industry recently. This trend further picked up pace and accelerated with the rise of COVID-19. Today, everyone is employing specific digitalisation strategies to go through business transformations and streamline their supply chains, whether it’s internal or external, to automate manual functions wherever possible. As a market leader in digital transformation for the fashion sector, WFX has grown from strength to strength in the last couple of years. We offer a basket of technologies for both fashion brands and manufacturers and have been able to take advantage of the growing demand for digitalisation.
We currently have presence in over 50+ countries and we service to more than 600 customers who are leaders in their own field. Our customer base is well diversified across the world with our biggest markets distributed across Asia, Europe and North America. We are now also making inroads into the Middle Eastern market and plan to continue expanding our global reach.
How has the pandemic and the Russia-Ukraine conflict impacted this market?
I think the biggest disruption has been from the rise in energy prices across Europe, which has had a cascading effect on living costs. The rise of sanctions on Russia also played a role in the dampening of demand for a lot of big brands who are reliant on that region. With a steep rise in cost of living and inflation, demand for fashion has slightly softened which you can see from statements from the big US retailers in their recent quarterly reports. People are putting off discretionary spending which means fashion brands, especially in the most affordable category, are the worst hit.
Apart from this, the crisis has also highlighted the importance of having a resilient supply chain. It’s no longer feasible to buy from a concentrated set of a few suppliers. Companies are working towards creating a more resilient sourcing strategy for their supply chain by trying to near-source and remove reliance from a single supply source, vendor or country. Companies are trying to mitigate supply chain risks through distributed sourcing in different geographic regions rather than putting all their eggs in one basket.
What are the latest developments in the PLM technology? What factors are responsible for them?
The latest developments in PLM technology are being driven by the need for real-time data, the use of Internet of Things (IoT) on the production floor, smart factories, as well as the application of artificial intelligence (AI) in elements of decision making.
The use of IoT on the production floor is one of the biggest trends. For example, WFX Smart Factory connects machines and devices to a centralised cloud-based system where companies can get real-time data on their production line. This allows them to optimise production performance and help identify faults before they happen and eliminate downtime.
Another major development has been in AI and its role in data analytics and decision making. In addition to being able to collect more information, it’s also possible to make connections between different pieces of information that wouldn’t have been possible before and then use those connections to help make better decisions about your business operations. For example, when you’re costing fashion products, the system can automatically suggest and tell you when in the past you might have cost similar items for different prices and their lead times. So instead of just collecting data, you’re also building intelligence in the product creation process.
Thirdly, 3D design is now allowing us to see exactly what products will look like before they are manufactured. This makes it easier for companies to produce prototypes quickly and on budget, which allows for fewer samples and less waste during manufacturing because you know what your result will look like before it’s even created! 3D design combined with virtual showrooms such as WFX as well as PLM means companies can now connect with customers all over the world without having to travel as much for meetings or demos, allowing them to stay competitive despite limited resources.
Finally, sustainability tracking is also becoming more common, as companies strive to reduce their environmental impact and improve their sustainability standards, they want to track everything from CO2 emissions to water quality.
What is the rate of adoption for virtual showroom technologies? Which features have been most exciting for customers?
We have seen strong adoption and it is only increasing as more and more people become aware of the benefits that virtual showrooms provide. While there was an obvious demand for virtual showroom during the pandemic due to travel bans, companies are now looking at it as a great complement to physical showroom appointments.
Our customers, who are both brands and manufacturers, are using virtual showrooms to increase their sales volume without spending more overhead costs or waiting longer than necessary to discuss design iterations and get customer design feedback. It’s also allowing them to reach a larger number of buyers that would not be possible otherwise. WFX Virtual Showroom users can also get metrics like click-through rates, time spent on each design and so on, to better understand what’s working or not working in their lines.
WFX Virtual Showroom is easy to set up, so companies can get started with them quickly. For example, if you’re already using WFX ERP or PLM, you can launch collections to your virtual showroom in just a few clicks.
What are some of the trends that will shape the future of this industry?
In terms of the future of the fashion industry, one of the biggest business trends continue to be shorter lead times. People are trying to find innovative ways to reduce their time to market, such as through nearshoring production. The other trend that we’re seeing is shorter production runs. Brands want to avoid inventory risks and instead use shorter runs to assess what sells and use that information to quickly fulfil stock and avoid any markdowns.
Another mega trend is sustainability. Consumers are increasingly concerned about where their clothes are made, how they’re made, and what their impact is on workers’ rights and the environment. We are seeing sustainability become a priority for many businesses as they try to reduce their environmental impact while meeting consumer demand in a more environmentally conscious way. Brands and suppliers are also looking towards technology to help reduce waste at all stages of the supply chain.
In terms of technology, we are seeing a lot of interest in smart factories, that is, factories that use technology at every level to run more efficiently. For example, smart factories can be designed to use artificial intelligence and machine learning to optimise the flow of materials and products through the factory, saving time and money while improving quality and safety. These types of automated processes are also ideal for companies who want to scale their production up or down quickly depending on demand.
Digital transformation is also a huge area of focus right now with modern technologies like blockchain which makes data sharing and traceability easier than ever before. This means that clothing companies can track where their garments are at any given moment in the supply chain (and even after they have been sold) without having to rely on manual labour or paper records.
What are the future plans of WFX?
WFX is currently one of the leaders for digital transformation in fashion across the globe. We offer a full suite of products for both brands and manufacturers which includes WFX Fashion PLM, Apparel ERP, Smart Factory and Virtual Showroom. We have been working with some of our clients for over a decade. Our focus is to help fashion businesses transform digitally by providing them with tools that uniquely suit their needs. Our plan is to strengthen this position further by deepening our product suite and our offerings.
We have cemented a unique position in the market by building solutions for both fashion brands and manufacturers, so we deeply understand the industry and its needs from both sides of the supply chain. We aim to further drive this digital adoption for the industry because we know that fashion still has a lot of room to grow. There are still many places where the industry can reduce wastage through better optimisation of resources through technology.
We have a strong team of over 250 people who understand the industry and know what it takes to succeed. We’re not just going to sell something; we want to partner with our customers so that we can help them achieve their business goals and objectives. Our future plan is to significantly grow our team size over the next 2-3 years so that we can continue to improve our products/services based on customer feedback and add more product capabilities to keep driving incrementally more value for our customers.
