Newsletter n.5 July 2019

The work and interest on supply chain management in sectors such as the fashion industry continues to be relevant, given the need, increased in recent years, to optimize and better plan activities. More recently, the issue of traceability, in all its many forms (sustainability, counterfeiting, parallel markets, consumer guarantee, territoriality, etc.) seems to be the prevailing reason to deal with it.

As already announced in the previous newsletter, the eBIZ 4.0 activities have led to the release of the 2018-1 version of eBIZ, new and more extensive (but always backwards compatible) that broadly addresses the subcontracting of finished product (including the transmission of certificates), but not only.

Now eBIZ, for example, supports catalogues of Fashion products (from yarn to finished product), even very complex and completed with multimedia elements, with broad support of multilingualism (including non-Latin alphabets) and diversified price policies in different markets; these are data structures designed to also feed eCommerce and eBusiness platforms.

At the following link an example of eBIZ XML file with an XSL in order to view a more readable layout

Another novelty was the testing of tools for companies’ Use Profiles, used by eBIZ 4.0 pilots with very concrete benefits: with them you can model your own minimum requirements for using eBIZ documents, share them with partners and automatically test their correct implementation from everybody. Custom Use profiles and automatic test systems have speeded up the implementation of solutions and improved data quality.

In this newsletter we will deepen some of the most relevant results of the project and illustrate the news for the future.

From eBIZ benefits that go beyond those normally obtained from digitization

The estimated cut of production costs up to 15%: this is the most significant datum emerged from the analysis of the pilots results of the eBIZ 4.0 project. Adopted in the course of last year in over 100 new companies in Europe, of which a fourth in Italy, eBIZ has shown how the benefits deriving from its adoption are independent of the single architecture and solution. In fact, three different digital platforms were implemented in the three pilots: ClaveI (Spain) focused the solution on an extension of the corporate ERP, Schaeffer Productique (France) used an interchange portal, Kyklos (Italy) used its SCM module integrated into customer ERPs.

The pilot companies are located in different areas of the fashion industry: textiles, clothing and footwear. The geographical areas concerned have included Spain, France and Italy but also, for example, Germany, Hungary and Portugal, with several international connections within the same supply chain.

In Italy, the focus has been on the production of the brands’ contractors of a large Italian group, ensuring the possibility of improving the monitoring and quality of production, the certification of origin, the management of multi-tier relationships and concepts such as the "events", the special series, or the different operating modes based on the different production objectives. The usage with RFID has been experienced. Furthermore, the relationship with B2B online purchasing platforms has been successfully implemented.

In France, the field of application was fabric production: to mention the experience, among others, of a large German brand that aspired to extend the collection of data from suppliers in different countries, so far impossible to connect until now, and to significantly improve the quality of information, using the same eBIZ platform. In this case, the success of eBIZ came from the sharing of a semantic and common business rules.

In Spain, two supply chains have implemented eBIZ and RFID for logistics management from production to around 125 stores in the footwear sector.

Very good results came from the reduction in costs incurred for managing orders for the chain leaders: in the Italian case, this reduction is equivalent to the annual cost of a person who has been assigned to other tasks, thus optimizing the internal resources of the company.

But most of all, the savings in order management cycle times in the other two pilots were considerable: 50% in the French case, 75% in the Spanish case.

At the same time, digitization empowered through eBIZ adoption has led to a drastic reduction of errors and to a real time availability of updated data within company information systems. The consequence is also a reduction in corrections during production phases and a reduced number of rejects or defects.

Moreover, thanks to the reduction of the time needed to propagate the updated data within the supply chain decision systems (DSS) (reduction between 86% and 98%), the companies in the supply chain and the brands are able to obtain greater visibility and greater control over the advances of the production process

The analysis of pilots’ results, however, has also highlighted how the adoption of the solutions based on eBIZ has allowed companies to obtain substantial benefits, which go beyond those that are normally obtained thanks to the digitisation of processes. This is particularly evident when one observes the reduction in the time and cost of setting up collaborations with new partners or new types of data flow: again in the Italian case there was a reduction of 90% (from € 10,000 to € 1000) to manage a new flow, confirming the benefits brought by the incremental approach of eBIZ that allows the reuse of data blocks in separate information flows. This starts from scratch, without considering the possibility of reusing existing interfaces for new eBIZ compatible connections.

The joint use of eBIZ and RFID had been tested in Italian and Spanish pilots.

In the case of Italian pilot, the combined use of the two technologies has automatized a traceability framework from the components to the final product, enabling the following advantages:

• Possibility to trace the single item instead of the lot along the supply chain;
• Possibility of improving quality with the control of components coupling;
• Logistic improvements (reduced time for inbound and outbound processes).

In the Spanish pilot, the issue of re-labelling all good in the warehouse was a strong obstacle to the implementation of the solution as planned in one of the brands involved in the pilot.

Traceability and Transparency for the Sustainability of Clothing and Footwear supply chains: this is the topic at the center of attention of UNECE-UN/CEFACT (United Nations organization for eCommerce and promoter of UN/CEFACT data exchange specifications ), which launched a project on "Enhancing Traceability and Transparency of Sustainable Value Chains in the Garment and Footwear Sector" (TTST) with the support of the European Commission, DG DEVCO, and in partnership with ITC (International Trade Center), and which held a first public event in Geneva on April 4th 2019.

Below are some notes that emerged from the discussion in Geneva.

The concept of Sustainability, in particular, is seen in its widest dimension: environmental, economic and social impact, but also codes of responsible conduct, efficient use of resources, in short, all the conditions that ensure the sustainability of industrial activities in the long, very long, period. In short, the approach aims to be as broad as possible (from the non-use of child labour to the issue of polluting chemicals and of end-of-life of products).

Of a more technical and technological nature are the issues concerning the traceability within the supply chains and the most suitable tools to guarantee the various actors to have greater visibility within them. The proposal of defining a pilot led by a big German fashion brand whose goal is to make transparent the supply chain, understood as set of sub-suppliers of its suppliers, which produces the fibers used in its garments, was reported during the works, starting from the involvement of a large community of farmers from a non-European country.

The activities of UNECE’s project will consist of three main strands / objectives:

1. the development of policy recommendations,
2. the definition of a vision of supply chains and of technical support standards (which will be subjected to the UNCEFACT standardization process) and
3. the launch of pilots on a national scale and the simultaneous dissemination of the results.

In this context there may be a role of eBIZ, which is proposed by EURATEX as one of the standards that can best support the collection and exchange of traceability information in a standardized, digital, ready-to-use format and carrier of a unique supply chain’s know-how.

One of the national pilots that has been announced and will contribute to the UNECE project is the Italian one launched by the MISE for the use of the blockchain for traceability, with the aim of creating new forms of protection for Made in Italy. A feasibility study is currently underway, entrusted to IBM for the technical part and with the involvement of business associations and individual companies.

The study was divided into a phase of consulting the companies and gathering the requirements and an analysis of the possible scenarios of use of blockchains; a report and an operational demonstrator are expected to be released at the end of June.

The activities were also contributed - among others - by ENEA experts, at the invitation of SMI, and companies using eBIZ with their know-how gained in this context.

Between the end of June and July, a public event is scheduled to report on the results of this activity.