With The Interline turning its attention to the processes of sampling and production, and how digitisation is becoming the engine for global transformation post-pandemic, we spent time with Chris Govier, who heads up the EMEA business for digital printing giant Kornit.
In this exclusive video interview – and shortened written transcript – we discuss the role that digital print can play in sustainability, high-fashion creativity, personalisation, and in unlocking the possibilities for entirely new business models built around producing on-demand.
(The transcript below captures only parts of the full video interview, which have been edited for brevity and clarity.)
The Interline: Over the last twelve to eighteen months, a lot of businesses have had to reckon with the consequences of holding inventory that they couldn’t sell. That was one of the most sudden and acute problems caused by the pandemic, but the question hanging over everyone now is how permanent a shift we’re seeing. Has the industry experienced a short, sharp shock, or are we witnessing the beginnings of a longer-term shift towards on-demand production?
Chris Govier: That’s a great question, and I think the answer is that it’s difficult to predict how things are going to develop. But it’s impossible to ignore that we saw 10 years’ worth of eCommerce uptake crammed into the three months from April to June – and that’s in the US alone. From Kornit’s perspective, we’ve seen exponential growth in the last twelve months, and we’re not seeing a slowdown in interest in digital and on-demand now that retail markets are reopening.
In my experience, brands and retailers today are desperate to evolve their business models to create better value for their consumers, and the traditional trend of buying in bulk to drive unit prices down just isn’t sustainable any more – ecologically or commercially. The initial supply chain crash last April and May has had a domino effect, and now people are looking differently at their supply chains. Something like 30% of clothing made is never actually sold, and as consumers, how long are we going to be satisfied paying for those write-offs? And as professionals working within the fashion industry, how ready are we for change? I think there’s a mindset shift happening on both sides.
The Interline: It’s hard to imagine many other industries where leaving 30% of products unsold would be considered normal.
Chris Govier: If you look at other industries, digital transformation has happened already. My background is in digital print, and in that sector we saw significant change that was driven by technology, but accelerated by consumer demand. The situation today feels very familiar: digital fabric and garment printing has been viable for a while, but it’s been waiting for the market to catch up and to understand how to utilize it. Now, all the stars are aligning: consumers want things that are personalized or customized for them, and if possible they want them tomorrow. And that combination is impossible to deliver with traditional supply chain models.
The way fashion has worked until now, if you don’t have a product available, you can’t sell it. With a digital, on-demand model, you can sell it and then make it – quickly enough to tip the entire process on its head. And that’s the really exciting part of what we’re seeing at the moment.
The Interline: So are you finding that more brands and retailers are now receptive to flipping the model in that way?
Chris Govier: Very much so. I recently spent a week in the UK, where we were visiting traditional fulfilment networks and Kornit customers that use our technology to produce for the major high street brands and retailers, and that vision to let go of the shackles of the traditional supply chain was everywhere. Producers are ready to demonstrate that they can do things differently, and better – not just for profitability reasons, but from a whole business model transformation perspective. Because if you look at the traditional method and compare it to digital like-for-like, comparing just unit costs, then it doesn’t make sense. But when you start to release the costs associated with holding inventory, and the cost of markdowns and write-offs, and when you start to consider the lack of consumer choice and the sustainability impact of traditional methods, then the possibilities of digital are incredibly compelling.
The Interline: We’re talking about product-level agility and flexibility here – having something the consumer wants available the same or next day. The other side of that is category agility; COVID was an extreme example of the flexibility of needing to pivot to a new product type, with everyone offering masks, but that’s also emblematic of the requirement for brands and retailers to respond to shifts in the market. What role does digital have to play there?
Chris Govier: When you look at social media platforms, and influencers, they have a huge – but unpredictable – influence on what people are buying. So we have the ability to be extremely reactive because of technology, producing something new to meet an overnight spike in demand, but there is no way that the traditional supply chain methodology can respond to that. Even in a best-case scenario, traditional production will take ten days from order to receipt of goods, and ten weeks is more likely.
Critically, that initial order may have been for 3,000 or 4,000 pieces, and when they sell out the brand has to make a choice as to whether to order more, to see if the demand is still there, but to wait another ten weeks for it to happen? Or do they accept that the opportunity has run its course, and that they will leave the potential revenue on the table. Without the capabilities of digital, that’s the choice brands and retailers are having to make. But with digital, that product can be made much faster, and also kept available online – so that whenever the customer is buying, you’re still making and selling.
We have a microfactory set up London that includes our direct to fabric system, Presto S, and an automated cutting machine, with everything in-line. We recently had a UK brand come through and spend a few hours with us, learning about the technology and testing the potential. Within 45 minutes there was a dress, printed, cut, sewn, and ready for them to take away. And if that’s not agility, then I don’t know what is.
The Interline: When we’re discussing speed in fashion, it’s important to distinguish between bringing products to market faster – responding to micro-fluctuations in demand – and the established model of fast fashion, which is predicated on speed married to high volume and disposable end results. Where do you draw the line?
Chris Govier: For Kornit, fast fashion is a negative concept because of that disposability. It’s like single-use plastic, because people are buying in bulk, selling cheap, and creating a model that’s horrific for the environment. There’s also little value in fast fashion for consumers, because they will wear a garment once and never touch it again, but because that’s been the primary model of fashion, consumers are being conditioned to believe that it’s the only model that’s available to them.
Smart fashion, on the other hand, is about having consumer demand for newness addressed through the ability to design and customize a product for an audience of one, and to therefore create something that the buyer wants to hang on to for a longer period of time. Any garment that’s worn more than once is a win for us, and it’s a win for the environment. And crucially I think we’re seeing that there’s real consumer demand for a new model.
The Interline: On completely the opposite end of the spectrum to high volume, we have the demands of high fashion, where quality and a complete lack of compromise will be the key deciding factors in the adoption of any new technology or process. What role do you see digital printing playing there?
Chris Govier: Kornit recently participated in, and hosted, the Tel Aviv Fashion Week, which was something of watershed moment for us because all the collections that were showcased were printed sustainably on Kornit technology. Sadly I couldn’t be there because of COVID, but I was sent a remarkable story of a particular model who originally wasn’t able to participate, but who became available at the last minute – something like 36 hours before the show was scheduled to start. Because her presence hadn’t been planned for, she didn’t have a dress to wear, which would normally have been an impossible problem to solve for a traditional supply chain. But because of the unique potential of digital, the designer drew something, we printed it, and within twenty-four hours the model was walking down the catwalk wearing this amazing outfit.
That speaks to the fact that, right now, brilliant designers are restricted by the fabrics that are available to them, and their ideas are constrained by what’s being produced. When you can remove those limitations, like we did around the Tel Aviv Fashion Week, you see creative people who’ve worked for the world’s leading brands become quite emotional, because the things they had in their minds could be brought to life and altered on the fly. Those high fashion designers have really pushed the boundaries for us, which, being a research and development-oriented technology company, is perfect.
We’re now looking into fashion weeks in New York and Los Angeles, because we believe so strongly in offering that design freedom to the high end of the market: if you can think it, you can print it, and if you can print it, you can make it.
The Interline: What’s your perspective on the future of sustainability?
Chris Govier: Sustainability today can be the foundation for an entire company, and it can be an initiative that people from all different backgrounds and discipline want to be involved in. We’ve all also seen that brands and retailers are advertising senior, director-level roles around sustainable sourcing and ethical production, so there’s it’s clear that sustainability is finally here to stay.
But we also understand that there’s still a need for brands to make money, and that under the traditional supply chain and sourcing methodologies there will be always a commercial trade-off for greater sustainability. That’s why I believe we’re looking at a complete ecosystem change – moving away from some of the KPIs that people have become fixated on, and making savings elsewhere that will still generate reasonable margins on the other side.
If you think of the endless virtual variety that you can sell online – thousands rather than hundreds of options – we’re enabling that through digital, without the requirement to hold huge warehouses full of things that are never going to be sold, and which will eventually be disposed of in a way that’s harmful for the environment.
The Interline: Tied to consumers wanting to buy more sustainable products, and products that last, is the desire for people to buy things that they feel are truly theirs, and that express their identities. That level of personalization is something that traditional value chains have struggled to provide because of shifting timelines, minimum order quantities, and other variables. Do you see digital as being the key to unlocking genuine personalization, and true on-demand production?
Chris Govier: We already see a huge amount of customization in the direct to garment printing side of our business, since the majority of our customers are offering personalization. Whereas you once walked into a shop and bought just what was on display, now it’s possible to choose a t-shirt type and colour, and then to fully customize any artwork that gets applied to it, in terms of size, position and so on. That’s something that isn’t achievable in any other way besides digital, direct to garment printing, and it’s already extremely successful.
The real opportunity now is in the direct to fabric side of our business, and I believe we’re just on the verge of being able to create real customization there. We’re talking about the customer having the ability to fully adjust the pattern of a dress, scaling it and moving it, and putting a huge amount of power in that customer’s hands to create something that’s completely individual and that they want to hold onto for longer. The margin potential for brands and retailers there is also significant.
The Interline: Talking about personalization brings us inevitably to the question of volume. Whether we’re talking about genuine, MOQ-one level personalization, or a broader shift away from forecasting to demand-driven production, people are going to ask whether it’s possible to achieve at scale. Is it feasible to take proof of concepts like microfactories and extrapolate those principles from small production runs to larger volume manufacturing?
Chris Govier: Another great question, and the answer, I think, is yes: we can see scale. We’ve already established that the current model of producing in bulk to predicted demand is unsustainable, but there’s definitely the opportunity for digital to replace it. What that means for us is effectively a globalization of print, with combined print and distribution centres around the world that can be used to break up large bulk orders into bite-size pieces that can be produced in closer proximity to the consumer. Again, that’s something we’re already seeing in our direct to garment business, so we know it’s scalable in a serious way, and the market space it has to grow into is incredible: only about 1% of the t-shirts that are decorated worldwide today are being done digitally, and demand for digital is accelerating.
As we’ve seen in other industries that have gone through their digital transformations, once the tipping point comes, the acceleration is phenomenal. And in fashion I don’t think we’ve seen that tipping point yet, but it’s coming. Consider the digital camera market, which people thought would never take off because everyone was wedded to having their photos developed and printed, and then an entire industry is upended seemingly overnight because consumers voted with their feet.
I see fashion as being at a very similar point, with brands and retailers understanding that they can achieve the same levels of revenue and margin, but actually serve their consumers better, in a more responsible way. The key now is automating that opportunity. Today a brand that sells in Australia will tend to produce in the Far East, and then ship inventory into a domestic distribution centres to hold, when what we’re talking about is holding inventory virtually and printing and distributing it only when it’s needed.
That’s something that we’re confident we can deliver using our printing technologies and our workflow platform. That combination is, we believe, going to be the game-changer because it enables everything else we’ve spoken about to be joined up and to create a superhighway of demand and fulfilment around the globe.