Innovations shape the way businesses engage, transact and thrive.
If they didn’t, they wouldn’t be advancements; they’d be duds. But sometimes even the most promising advances, such as the ongoing digital transformation of commerce and payments, need a little push forward from the macro environment.
“[The COVID-19 pandemic] helped drive a permanent change in the fashion industry,” Kristin Savilia, CEO at online B2B wholesale marketplace JOOR, told PYMNTS CEO Karen Webster for the “B2B Payments: Outlook 2024” series.
“You don’t have to be at every trade show or every showroom,” she said. “There are certain levels of buys that you can do remotely and be just as successful.”
Digital and mobile payments were accepted pre-pandemic, of course, but the idea of virtual showrooms was entirely foreign. Now, a fashion industry without virtual showrooms feels just as foreign.
The role of trade shows has evolved into fostering connections rather than being the primary buying grounds, Savilia explained.
“Personal connection, especially in our industry, is really important,” she added.
Innovation in payments, digital adoption and artificial intelligence integration are reshaping how businesses operate in the dynamic fashion sector, but Savilia explained that despite the industry being early to embrace digital, online buying and selling for the wholesale side of the industry took longer to implement.
“The fact that [wholesale fashion buying and selling] was left for so many years to excel spreadsheets and paper line sheets is really shocking,” Savilia said.
She added that there are, still to this day, certain popular brands that haven’t made the switch to digital.
And that’s despite the opportunities and optimizations that digital brings to the everyday commerce-driven contexts that make up a fashion brand’s runway.
“Our data told us months ago that larger department stores have shrunk their buys,” she said. “They’re expecting a tough holiday … but, interestingly, the small- and medium-sized businesses (SMBs) were up slightly in their buys. They are looking for a flat holiday as opposed to a down holiday.”
Other insights that can be derived from purchase orders at major fashion weeks include upcoming trends, like the emergence of liquid gold patterns and the resurgence of the white Oxford shirt.
“Sky blue is going to be a big color coming this spring, and we are able to share that information with our audience in case they might have missed the trends, and we’re able to show them exactly where to buy it,” Savilia added.
Savilia explained that the supply chain issues of the past years are behind us, and stores are now strategically managing open-to-buys to avoid overstock situations.
“[Everyone is] being very cost conscious of their dollars and how they’re spending those dollars and trying to keep those buys tight,” she said.
New digital payments innovations are helping businesses navigate the ongoing macro uncertainties with real-time insights and transaction data that can lead to mutually beneficial B2B payment dynamics.
“I don’t think we truly understood how backward this industry is in payments until we launched JOOR Pay,” said Savilia. “[Digital payments] bring transparency, they make it easy … the hottest selling point is digitizing this process.”
After all, once B2B payments go digital, the businesses on either side of the transaction now know either where their money is, or when they can expect it, and reconciliations become a breeze.
“We [basically] built an invoicing system … the concept of bringing it to digital has changed the dynamic of how quickly you get paid,” she said. “From our own information and data, people were getting paid 30 days-plus from invoice when the invoice was manual or an email that got lost. With our platform, they’re getting paid in under 11 days on average.”
Still, she noted that real-time payments, at least for B2B transactions, “come with a premium” that the industry isn’t willing to pay at the moment.
When it comes to AI, though, Savilia said she sees a runway as compelling and attractive as any fashion show.
“We have so much data on our platform around who pays whom, when and how often, and there’s a future where AI can come into this and streamline and speed up approvals,” she said. “Right now, it’s a manual process, and I see a world where this matching happens more quickly, as does the surfacing of the right candidates for lending.”
She said the best way to evolve a product is by “listening” to the frictions.
As for the further role digital innovations like AI can play, Savilia said there is potential for the tech to be leveraged to improve language translations and, more ambitiously, create a platform where small businesses can easily access unique merchandise data, fostering their distinctiveness in the market.
“The dream [with AI] I have is someone coming to our marketplace who wants unique items,” she said. “They say, ‘I want to carry merchandise that nobody else in Paris is carrying.’ And to ask that as a simple question and get a simple answer because we have the data to feed you that.”
While she acknowledged the tough macroeconomic conditions predicted for 2024, she emphasized the importance of continued digital adoption for long-term cost savings and transparency in the fashion industry.
For all PYMNTS B2B and Retail coverage, subscribe to the daily B2B and Retail Newsletters.