Hello and welcome back to the Retail Podcast.
I'm joined by Senior Vice President Eric Linksweiler from
Trade Beyond. I think we're set up for an
interesting conversation just by the a snapshot that Eric gave me
what what's occupying his time right now?
But Eric, for those who don't know who you are or what trade
beyond are above, sorry about, if you could just give us an
overview that would be phenomenal.
Yeah, fantastic. Hey, Alex, thanks so much and
really appreciate the channel and the opportunity to to chat
with you today and tell the folks, you know kind of what we
do here at Trade Beyond. So we are a global organisation
and I manage the team around the globe, from North America to
Europe to our headquarters in Hong Kong and throughout Greater
Asia. We're in the business of helping
Tier 1 retailers and brands to streamline their processes,
manage their extended retail supply chain as it pertains to
private label product development, sourcing, costing,
compliance, quality to the container.
Our customers enjoy our platform in that it, you know, reduces
time to market, creates efficiencies and allows them to
have greater visibility in their overall day-to-day operations.
Wow, that's a, a pretty impressive list of activities.
You, you obviously must spend a lot of time I #1 travelling the
world and #2 meeting executives at these Tier 1 retailers.
Given the diverse sets of operational environments across
the world, what's keeping people awake right now?
What's what's the number one thing people want to talk to you
about when when you're meeting execs?
Well, yeah, in in our world we have gone, we've gone into a
time of high regulation through legislation.
As it relates to the retail supply chain in particular, the
execs that I speak with, you know, around global sourcing,
supply chain management, around governance, finance and
compliance are deeply concerned about making sure that they are
doing the right things to not impede the delivery of their
shipments of direct import. And to do that they are they are
grappling with how to create digital chain chains of custody
to document the flow of their merchandise from early stage raw
material development through finished goods.
This is a topic that we talked about every single day.
Of course, the cost of shipping of cost of moving goods is top
of mind, creating new opportunities for source,
exploring opportunities to move into new geographies.
And what that does to the business is the infrastructure
available. Are the people trained up and
able to to enter into a new market or a new geography to
help bolster their sourcing strength.
You know, that's a lot. Those are four or five topics
jammed in there, but those are the kind of things we hear about
everyday. What's?
In terms of if, if you were going to break that down in in
into the various categories of, you know, stuff that's going to
impact the product arriving, stuff that's going to impact the
product being produced and the whole traceability.
And then you've got sort of sustainability that sort of
covers all the areas. I mean, sustainability is a
really interesting one, especially like.
The. In a cost of living crisis when
consumers were given the choice, do you want cheaper products or
do you want more sustainable products?
I think there's a very sort of mixed response there.
I'm just curious how retailers see that problem because is, is
the legislation, especially in Europe going towards more
regulation and more sustainable like, you know, understanding
where your raw materials coming from having product passports
for, for products. Yeah.
What's your view? Yeah.
You know, Alex, I've, I've, I talked about this with others,
others in, you know, that sit in chairs like yours as well as,
you know, our clients and, and, and, and and other folks in the
ecosystem that I work with. And the way I see it.
And you maybe I'm, maybe I'm a bit of an optimist, but you
know, this whole topic of sustainability, it's not new,
OK? It's been, you know, we've been
talking about this for a while and some of the better companies
are actually say the leading companies, not better leading
have been, you know, exploring opportunities of becoming a more
responsible sourcing organisation, a more sustainable
organisation as it comes to material consumption, waste,
circularity, et cetera. So those conversations have been
going on. What's new is that folks are now
forced to do something about it, right?
What becomes law becomes, you know, and what becomes
measurable, you know, now becomes action.
And, and, and, and I, I see that as a good thing, frankly.
And it's just, it's, it's taking the leaders and it's putting
their thoughts into actions and it's helping what I see that
from an optimistic perspective is the leaders are dragging some
of the laggards into the conversation and into the action
plan with them. You know, I see, you know, we
operate in a, in a global shareable world, the global
shareable economy, a global, I mean, gosh, we share, you know,
we share rides with each other. We, you know, we, we share, we
share seating at the table and at restaurants together.
And, and everything is becoming more, more community driven.
I see this, you know, I see this particularly in the apparel
space. You know, the leaders in the
apparel space in particular are helping each other to partner
with their common supply chain suppliers and, and developers
and, and mutually helping each other to realise goals and
targets around sustainability. So I think I, I, I think the
future is, is challenging, but bright.
I think the road to brightness is going to be bumpy, but I
think the future is bright. Do you find?
How do you manage, you know the different cultures specifically
in Europe or in Asia where you know it is higher on on the menu
compared to North America or the United States?
It is sustainability from your experience as much of A issue in
in the US or not? Well, I don't know.
It's a question rather than a statement.
Yeah, Yeah. I believe we're, I believe in
the in the US and North America in general.
We're certainly catching up, catching up to Europe, Europe,
Europe seems to act faster and with more depth and more
diligence around these topics than we do in North America for
sure. But the North American consumer
is, is driving the market. It's driving the turn as well,
as well as the, as, as well as the legislation.
And, and I, I, I, I believe we're seeing, you know,
certainly a, closer to the middle, a closer to the evening
or the levelling, I should say, of all regions around this
topic. And, and do you see in terms of
the category of product or retailer gross, I mean, I
remember reading a fantastic transparency in supply chain use
case for I think it was LVMH. So you know, 3-4 years ago they
wanted to on one line of products bring that traceability
to life. Do you see a certain category
having more focus on by retailers or are they all?
It's across all categories right now.
I believe, which is not uncommon in our business, certainly
around digitalization, that apparel, footwear, wearable
apparel, footwear and accessories are leading the
charge. You know, I, I remember I'm 100%
retail. So I'm, I'm a bit biassed, but I
and I work across all product assortment or merchandise mix
retailers, hypermarkets, DIY specialty, this department
store, you name it. But, but clearly with the amount
of consumption that we see in apparel, you know, obviously
food out out stripes it of course, but with count of
consumption as it relates to material usage, apparel,
footwear, outrace, everybody at this point, at this point that's
where the majority, that's where the movers are.
Yeah, well, and what are the sort of quick wins retailers can
do in this space apart from obviously picking up the phone
and speaking to you guys? But what what's like when they,
when they come to you again and you're having these
conversations, they how how are they, you know, what's the
outcome that ultimately they're there trying to get to that you,
you will help them with or the the the major one that you're
you focus on. Yeah, what I try to do is strip
people down to the basics. You know, most, most folks come
to us with a very long wish list and they want it all and they
want it all tomorrow. They don't have the foundation
in place. They don't have the building
blocks in place. The building blocks of your
supply chain is just that. Your supply chain partners, your
ecosystem, your supply chain community.
And in in what we do is we emphasise the importance of
identifying to the 3rd, 4th and 5th tier every member of your
supply chain and actually getting it into a visualisation
map that allows you to see the inter and intra dependencies of
all those members. And then begin your segmentation
of that map into certain certain like types, certain certain
performers and non performers, certain folks that can impact
your goals in certain areas at a significant level.
So where is my biggest opportunity for scope free
reduction if I have a supply chain made-up of 15 to 2000
active supply chain partners? It's not in all of them, but
until I get them all mapped and can backwards to the top 100, I
don't really know where to start.
So gaining visibility into your true supply chain community and
that community of partnerships is job one.
And it's very low hanging fruit, by the way, it is a place where
we can to your point, Alex, you asked where's the quick win?
I mean, it's a, it's, it is a quick win.
It seems elementary, but you'd be shocked at how many folks are
trying to do this manually on paper in Excel and just can't
keep up with it, right. And and so these are the tools
we bring the market that we help, you know, we help make
that. I won't say make it more simple.
I don't like that word because everything is work, but make it
possible. And that, that's where I like to
emphasise. Do you has anyone's?
Oh, again, because I, I'm definitely not a supply chain
expert, but in terms of the single modality of a lot of
supply chains not having redundancy built into Geo
geographies where there may be tension somewhere in the middle.
And you know, therefore they have to then diversify to
another region or country. Again.
Is that is that something people are like going to bimodal supply
chain models in terms of, you know, I've got something in Asia
or China and I need to get something in, in, I don't know,
Brazil or something in case something happens.
Is that is that the level of depth people are thinking about
or is that just very like they're?
No, no, they, they, they are absolutely at that level of
depth of thinking and a conversation and of modelling
and of seeking outside counsel and outside support and outside
advisorship on how to make that happen.
That being said, I don't see a tonne of execution from that
perspective, you know, from using your words, you know, by
bimodal. Now what I do see that is being
executed is the elimination, you know, of redundancy on maybe on
a, on a single modal perspective as an example.
And from a systems management perspective, you know, I do see
of most organisations moving forward with digital
transformation projects to get their entire organisation on a
single backbone whereby they can be communicating more
effectively. Everybody's hearing the same,
everybody's on the same channel, everybody's getting the same
message, everybody's understanding exactly where they
are in time and motion and in critical path and in milestone
because they're all on a single sheet.
That has happened. That is, that's what we do and
that is absolutely happening in the biggest organisations in the
world. Go ahead.
How, how does that compare? So where, where does it again,
theoretically, I read a lot about, you know, how retailers
are optimising their supply chains to finish at the
customer, not at the point of entry at some port in country.
And again, I, I haven't because people don't really talk about
this trans, this sort of transparency.
How much of that do you see from your experience in terms of have
you seen good examples of supply chains finishing with the
customer as in you know end to end visibility on that?
You know what's interesting about that is you do hear a lot
of people talking about it and what I the success stories I see
are with the smaller organisations that are do a
better job figuring they do a better job figuring out the last
mile than the large organisations.
You know if you are $150 billion top line, $50 billion US top
line retailer, yeah, the volumes you are working with make it
challenging to have the supply chain end at the consumer,
right, At least, you know, at least from finished good to
delivery. So we don't see this much there,
but in the mid tier, in the mid tier, we're seeing more and more
of that and they're getting better at it.
I mean, I was in Shanghai in couple of weeks, 3 weeks ago
doing a, a bit of a recce safari with some retailers and I was
really impressed with their sort of sustainability, how they're
trying to drive sustainability through their different supply
chains and operations. But again, it's a big, you know,
there's a big diversity in terms of people who, who are nailing
it and people who, who are, are still, you know, doing things
the, the old way you mentioned earlier in terms of the quick
wins. What's the one thing that's
surprised you when you, when you speak to retailers?
Is there any themes that like you're like, oh, things that you
thought people had already done or doing and they're not doing?
Is there anything that's really surprised you when you're having
these conversations that you can share?
Well, I'll tell you, you know, it's I, I take it back to that,
to the dinner conversation. You know, you go to dinner with
your wife and you sit down, you're having dinner with a
couple you you don't really know very well.
Maybe it's her girlfriend and her meeting the husband for the
first time, right? Yeah.
And you get into the conversation.
So what do you do? You know, and I start to
explain, well, I help retailers that are developing private
label and this and that and, and, and then they kind of drill
in a little bit and they go, well, gosh, you know, if
they're, if they're already creating, you know, if 50% of
their assortment is already private label and they're
managing all that on their own, I mean, it seems like they've
got it pretty figured out. What else can you possibly do?
And I said we need be surprised. You'd be surprised to walk into
$100 billion retailer and see how much they do on sticky
notes, on e-mail, on WeChat. And this hand's not talking to
the other hand. And yet they're managing this
massive business. I mean, and yet they're doing it
from a state of pencil and pad. That's the biggest thing that I
see. And, and, and then on top of
that, once you see it, it's the inability for so many
organisations to make a decision and get started on an
optimization and a transformation programme.
They are just, they are just hypnotised and paralysed in, in
their ability to move forward quickly.
That's the biggest surprise I see.
It's, it's, it's a bit frustrating to me actually,
because I see so much opportunity and so many dragging
and so many dragging feet. And every year you'll get the,
you know, you'll get the Gartner report and here's what we're
going to do. And here's how much money we're
going to spend. And here's the projects that
were, you know, that are top of mind.
And these are the things that we're budgeting for.
And, you know, the numbers at the beginning of the year never
seem to match up to the numbers at the end of the year.
Yeah. I mean, look, I the, the allure
of private label is you know, from a, a return on investment
is fantastic. And that's why, why I understand
it coming towards the end of, of our, of our chat, 2 sort of
areas that I'd like to focus on and, and I'll let you decide in
which way you'd like to answer them.
Circular and sustainability and how practical ways you can help
retailers or what retailers should be thinking about is, is
one question around, specifically around circular and
sustainability. And then the second one, when
you look to the future and you look at, you know, OK, not
looking into the looking glass, but what you think is going to
be on people's agendas going forward, Is it going to be more
regulation? Are there other things that you,
you see on the horizon? Yeah, 2 questions.
Yeah, both of them pretty busy. You know, the circularity
conversation is an interesting one and you know, certainly one
that I, I embrace. I'm not an expert in
circularity, but we're getting more and more into these
conversations 11 place where people are using the tools that
trade beyond to assist them here and other tools, not just sorry,
of course we're getting we're we're beginning to do a better
job incorporating the. The end life of a product and
the voice of the customer utilising the product playing
back into the early stage development of the next
generation of a collection or of a product.
So, So what do I mean by that? So if you are a, you know, if
you're let's stick with apparel, I mentioned that earlier, you
know, if you're an apparel or retailer and you're, and you're,
you're creating a, a new material, let's say a new
material blend that hasn't been in market before, proprietary
material blend and you're, you're, you're building that now
it's taking you 18 months to get it to a role and now we're in
production and we're producing product and that product,
product is in the market. In the past when that product
has been returned for a quality issue, a performance issue,
etcetera, we never get that information back to the front,
back to the early stage product development cycle so that we can
improve upon it. We just sort of forget about it.
We throw it away and we leave it.
We leave it to the past and we just start working on a new
product. We're seeing a much better job
now, new tools available. AI is helping out a little bit
here. You know, we're able to deliver
and anticipate some of the reaction from the market and
we're pushing that reaction into the early stages of product
development for the next generation of goods that that's
happening, that's happening. It's slow, it's got a ways, it's
got a ways to go. But, but that's what I would
say, you know, about circularity, I'm very bullish on
it. I, I really believe, you know,
again, it's my optimistic side. I really believe as a, as a
human race in general, you don't, you only hear the bad
news, you don't hear a lot of the good.
But we're beginning as a global society to understand the
importance of that and understand the importance of
taking care of things longer term.
As for the future, I do believe that we are going to see more
people jumping on the artificial intelligence machine learning AI
bandwagon. Right now the use cases
impracticality frankly are limited in our in our business,
in our world, particularly around the area supply chain.
But we're working hard at it. Other folks in our business are
working hard at it and we're beginning to at least get a
vision towards, you know, what does 12 months outlook like for
tools that we can deliver to our customers that would be
meaningful and help them. Automating the onboarding, the
vetting and the actual activation of new source, new
sourcing agents, new sourcing the supply chain partners is, is
a key. Being able to anticipate the
performance of a particular product in market in different
climate, in different use patterns, that's coming and it's
helping our designers that are on our platform in the early
stage. Being able to do cost
optimization using AI is something on the sourcing side
of the business that we're that we're seeing start to bubble up
to the top that you really can't do with a lot of manual
actually. I mean, you can, but you know,
obviously we, we speed up, we speed up the process with AI,
the whole, the whole topic of traceability, traceability of
labour, traceability of slave labour, of, of illegal underage,
socially challenged labour. This is a huge opportunity for
AI, one that we've already employed and we do have an
action. So I think that's where the
future is. Lots of opportunity there that
we're not there yet. People want to rush it.
People are trying to rush it. It's not there, but the
practical use cases are starting to come out.
That's fantastic. Thank you.
Eric, a side note, will you be at any of the conferences in the
final sort of quarter of the year you is trade beyond
expoing? We, we do, we, we actually find
a lot of opportunity in some of the smaller or some of the non
profit events. We do a lot of work, for example
with the American Apparel Footwear Association.
A A Of course, we attend some of the larger retail events.
NRF, right? I think you guys had a big
presence at NRF this. Year certainly NRF on an annual
basis in New York shop Hawk these larger events we do you
know one of our most successful events not to plug but we have
we have an event that we run in Hawk in Hong Kong every November
called Global Sourcing Day. Oh, we sponsor and produce this
event ourselves 100% full full full day.
And you know we're in the heart we're in the heart of global
sourcing for Consumer Packaged Goods and products and
merchandise there in in Hong Kong.
And so we have leaders, managing directors, supply chain leaders
from all over greater greater Asia and and several from Europe
actually that come in for that, that day.
So people can see that on our website actually.
What's the, what's the outcome of the event?
So is it, are you, is it like people talking about various
elements of supply chain? Is it?
Is it some workshops or bit of everything?
Yeah, yeah. It's we primarily bring in
experts in the space of supply chain, supply chain
optimization. We bring in efforts in the
around topics of environmental, social, governance and
compliance. We bring in logistics experts,
run panels, offline workshops as well, and of course give folks
exposure to a lot of a lot of digital tools and platforms that
we either connect to or that we develop ourselves.
That's fantastic. What's the event called?
Sorry. Yeah, Global Sourcing Day.
Global Sourcing, I was just going to I'll put, I'll put the
I'll put the link in the show notes.
Eric, thank you so much for giving up your morning.
It was really great pleasure and hopefully maybe see you at NRF
in January. All right.
Fantastic, Alex. Look forward to it.
Thanks for the opportunity.