London Fashion Week 2013 is showcasing to great success this year. The British talent today will exhibit its creative power and label muscle alongside the power houses . Many shows have gone mainstream thanks to live digital broadcasting. Technology indeed has democratised what only a few years ago was the realm of the PR houses who were the gatekeepers to the shows and their individually tagged seats. Still, the London fashion tech scene doesn't have much to celebrate because just days before this unmissable date in the fashion calendar, Lookk, the London-based fashion tech startup invested by the big and the mighty, has gone out of business after 4 years. Its CEO exited in August declaring that, while they succeeded in creating a nurturing community of fans and designers, they failed at creating an e-commerce market place. Though this may surprise the Silicon Roundabout dwellers, it is hardly news to the fashion insiders for the pieces of the puzzle to solve if tech startups want to disrupt and improve the Fashion industry, are a lot more than just "discovering" labels.
What makes Fashion a multi-billion dollar global industry is above and beyond discovery. Discovering new designers is not the gap to solve because thousands of media professionals, bloggers and stylists are at it 24/7 on a worldwide scale. While thousands of students graduate from fashion schools, only a few have real 'genius' worth backing financially. The creative industries, namely film, TV, animation, special effects, even source code writing, have tough recruitment requirements: only the best make it. Same as the restaurant business: discovery is not the major pain if the chef is a true artist. Anyone who has travelled to El Bulli or Thomas Keller's The French Laundry will confirm how out of the beaten track these Michelin star temples are, yet their reservations list is booked up six months in advance.
Any industry that turns creativity into a business makes it or breaks it because of other 'unsexy', 'little known' background factors, namely production deadlines and deliveries. This is why the fashion insiders can't stand Mary Portas and their stomachs churn at the mention of Hollywood pearls like Devil Wears Prada or Zoolander. Profit margins in the pre-a-porter or couture are tough or almost impossible to achieve, so the big houses build pyramids of product lines that allow them to create EBITDA at group level thanks to scalable and cheap to produce "lower entry products" such as accessories and fragrances. The esoteric formula creates a brand promise sustained by the genius and aspirational elements of the top line products, in order to successfully sell at higher volume their leather goods and perfumes. It is as fragile an ecosystem as an orchid garden. It requires perfection, genius and obsessive work.
Financial backing for a fashion label is not just about financing talented designers. While one is funding a creative genius that sometimes dictates collections based on costly fabrics and artisanal processes, this is just the pre-production side of the business. The bigger hurdle to conquer is to secure infallible supply-chain and manufacturing mechanisms like only the Spaniards at Inditex, MANGO or Textil Lonia (CH Carolina Herrera) know how to conjure up. And then, if producing a collection every six months was not straining enough, there's the deliveries of merchandise, something that deprives all retailers of sleep and profit margins, as the revered Burton Tansky, CEO of Neiman Marcus Stores declared at the Annual Vogue Retailers Breakfast in Paris.
"Designers need to recognise", Mr Tansky pleaded to Anna Wintour, a fashion editor of true vision and a real mentor to many designers, "that the worldwide demand for their products is expanding at a rate that even they themselves don't understand, so they are not keeping up with the production as demand is (currently) outstripping supply." Mr Tansky was not talking about amateurish designers from up and coming labels that are learning the ropes. He was referring to the heavy-weight houses in luxury prêt-a-porter. His angst was a torrent of despair. "We are waiting longer and longer for deliveries, and these mostly come at the back end instead of the front end of the delivery process". What Mr. Tansky unveiled is that discovery is really not the point: "Fashion is fun and we all love it, but with the ads out there in the media and no goods to sell..." Bingo. Here is your Lean Canvas's Problem to solve for all of you Google Campus crowd that want to get into Fashion by way of coding software.
When you are a buyer at a retailer, meeting amazing genius at the fashion fairs is really not the problem: the real pain is to find labels that can guarantee a certain stock of deliveries so that when you spend thousands of dollars in shooting ads showcasing their new collections, the products can be put on sale as soon as possible to cover your investment and cash exposure.
Enormously talented designer labels coveted by clients and industry have gone out of business because of deliveries. Even when they had funding for a given collection, it is the manufacturing, the supply-chain what makes or break a fashion business. Sourcing materials is as hard as getting a place in the queue of a reputable manufacturer. Successful labels use the same production lines, believe it or not. Ask Luxottica, the Italian eyewear manufacturer that in addition to its acquired brands (Oliver's People, Ray-Ban) produces the entire eyewear collections of PRADA, Dior, Chanel, FENDI and pretty much the whole world of couture. A good supply-chain executive can help an up and coming label get into the production line of a top reputable name in manufacturing, but it is done in the gaps in-between the big names. And if the big names have their own production troubles, guess where your place in the queue goes if something gets delayed. Lookk may have created a phenomenal fan base for your collections but you cannot supply their demand because you've been delayed by a major name out there.
The Fashion world does not need more designers to be discovered: it needs more high quality goods manufacturers that can produce and supply on time and in flawless condition the sizes and pieces that a collection has been paid to deliver to retailers; it needs shipping companies that can price their fees still leaving margins for the labels, with logistics that reduce costs and reduce time; it needs governments that reduce taxes on artisanal businesses that employ local people so that the labels do not outsource to third world countries where women and children are exploited. The latter is what has allowed the Spaniards to cost-cut and oversee quality at close range.
I am hugely annoyed when the tech media calls tech fashion the businesses of ASOS, Yoox, Fab.com, who are simply helping out getting rid of excess inventory. This is not innovative and this is not the business of Fashion: it is called "outletting". It is like putting Poundland in the same vertical of Waitrose. Let the stylists, the bloggers and the press discover creative talent. If you really want to help transform the Fashion industry, don't showcase emerging talent that cannot supply or produce proper collections. Fashion is not the Art world in need of curation.
Fashion is big business, it is part of the GDP of many nations, and it is a business of talent and perfection in the background. When this week London held its Fashion Week, the average collection run through is about 12-16 minutes. The rest of the seconds, minutes and hours towards and after that moment is a clockwork industry of talent and precision. That, the behind the scenes, is what needs your entrepreneurial innovation.