Richard Atkins is a renowned denim product developer from Hong Kong and has worked with some of the most well known brands and supply chain companies in the world . Sandeep Agarwal spoke to him to get his unique perspective of the current situation as he is based in HK and works with clients in US/ Europe and supply chain partners in Vietnam, Bangladesh, China etc . He shares his views of the crisis and how it affects us all.
Sandeep
Hi Richard. Hope you are doing great . I would say HK seems to have managed the current crisis pretty well.
Richard
Hi Sandeep . I am fine and hope you are as well !
Yes, it’s good actually and also we’ve had this for a long time, and we all need to sanitize our hands quite often every hour and the mask has always been a dominant thing in Hong Kong. When we first saw it, it was quite, as a westerner, confusing where our beliefs were if you wear a mask something is wrong with you, but now if you wear a mask, it has been considered a protective thing.
Sandeep
If we see from this perspective and compared to Europe, US and other countries, then, of course, HK looks pretty good and China has already recovered from the crisis and is in good condition and Taiwan is okay, Vietnam is okay. I would say this region is better off.
Richard
I think the problem we Hong Kong got caught up in to be honest, is that it’s not just Corona. But for the last six-eight months, we have had multiple problems. We first had the trade war with the USA and China and Hong Kong sat in the middle as a trader. Then we had the Hong Kong protests for six months, and then I think the corona came in around the end of January. Which was the same time as Chinese New Year when everybody migrated to go to see their families and obviously that was the time it started spreading globally, in a freaky way.
Sandeep
It’s really freaky and the way things are developing is still really serious, and we don’t know actually how things are going to be shaped in coming times, but looking at Hong Kong and also China, it gives you hope that at least you know you can control it to a certain extent.
Richard
It’s tough, and I think for the 1st-month people we were all in denial that this was happening and I always carried on working and travelling. Then a lot of people started saying I don’t think we should be travelling, but I had a job to do so I didn’t really think about the consequences.
Sandeep
So you travel most of the time to Europe and Bangladesh?
Richard
Most of the time I travel to Vietnam. Obviously at the moment, Bangladesh is closed for business until the end of the month as well as Pakistan.
Sandeep
Now coming to our industry , you are into product development and you develop collections and you interact with all the brands and clients in the factory, how has your work has been changed due to this virus ?
Richard
At the moment, my job has changed a lot, my travel plans on freeze, so everything I’m doing at the moment is digitally remote so I’ve got my team’s working on whatsapp or I’m using a kind of system to trust their eyes and their taste. I’m sure you know everybody’s got different tastes. I’m pretty good at taking the designers’ inspiration and trying to get their taste level. The guys in the laundries, they’re not into that kind of aesthetics kind of feel to anything.
As a product developer, I work with the designers and their expectations. To create beautiful garments which they’ve designed. If I allow the factory to work 100% on that and then we send the garment to them. I don’t think their expectations will be made. I’m not saying that the workers can’t do what the designers expect, but their interpretation would be very different.
Currently, the process is slow as I do it digitally, I’m talking to them on every process. I need to see photographs of each stage which takes time and a lot of patience as well some of the guys get so mad with me because I want to see high- resolution photographs just to see if there are highs or lows are different or is it correct.
I’m basically watching individual sign-offs that create the product. We also need to handle sign off in Hong Kong for the majority of our stuff for the German market. German shops are closed, and all the teams in Germany are working from home. I have to be kind of babysitting the whole process and work with our technical team. We have to evaluate and process for each garment to go forward into production. We kind of need to believe in our team that it’ll be okay in the future because we’re not even sure if it’s accepted once it all starts up.
We’re trying to keep it as a high standard as possible; nothing is missed before we go forward on a style. Our customers are still asking for the products, and they are not asking to hold back or stop it. So we still have our supply chain, we have actually quite a lot of okay smaller orders going forward.
We don’t just do denim here; we also do knit. We’ve actually been able to handle slowing down cut dates or reducing units that are already in work. We still need to have a reduction or percentage overall. If its late though into the market for knits they cancel but knit categories were down 30-35 % of the production, which is so sad but we can’t stop it either.
Sandeep
So denim is in a better place compared to other products ?
Richard
The beauty of denim is that it is a sustainable kind of garment, so it doesn’t affect our sales so much. If the shops open, it will sell. Compared to other types of seasonal products. For example, if a sweater is put into the store for the summer, you never know if it’s gonna sell. It might be hot, but as far as the jeans are concerned, everybody still buys jeans. It might reduce in quantity a little bit, but sales are similar all year round.
Sandeep
Are you working on seasons, I mean, is there any product development undergoing?
Richard
We went to European in the beginning of February to introduce spring/summer collections to the designers. They were picked and were ready for the next stage, we came back, and we started to do the second kind of fit garments, and then we had this huge problem. Which led to the complete stop of the supply chain. We’re lucky that all garments didn’t go into production.
But last week, we sat down around the table. We discussed why we don’t look at autumn winter because even if we make the spring-summer and put it into production, they probably would deliver into the shops in the wrong season. That’s the pipeline, so messed up at the moment because nothing is open. There’s no need to make the garment at this moment in time which is crazy. I’ve never seen this ever in my career.
Sandeep
None of us knew situations are like the second world war similar kind of situation
Richard
I think ten years ago we had a recession in the UK and we understood that there’s a recession in the UK. We all focused on the US trade to move the sales away from the UK. This time issue is global and when you sit as a product development that’s in the middle, we see the both ends erode together, there’s a huge issue!
We can see the shops at one end and what they’re doing online and what they’re talking about, reading it in the news. Then we sit and listen to the factories and the weavers, and the dyestuff chemical companies. Telling us a very different story. We are supposed to be transparent in the supply chain but it’s interesting when we read the news where it’s just a blanket of false interests. What I’m hearing sitting in the back is it’s not reality it’s crazy, it’s scary!
Sandeep
So your production mainly takes place in Vietnam?
Richard
We split our production into three different countries. Vietnam is one of our main destinations for our mid-range, and that’s with a majorly with TNT (factory name) then we got our Bangladesh set up. We have an office in Dhaka and are just building more of a denim team kind of push. Then we also have Pakistan with DCC and Dubai (desert studios), so we are covered.
Sandeep
So out of these three locations in next one year where do you see that it will be probably a little bit safer for you, not too safer maybe which might be more focused ?
Richard
At the moment, I don’t know what the future is when they open up. When I’m talking to the factory owners they’re very positive, they have optimism, and I like that. They need that drive because what I’ve seen in the last five six weeks, they’ve handled the situation exceptionally well with the brands but basically brands have bruised their relationship. I won’t even say bruised I think they have destroyed their relationship with some of their orders.
Sandeep
Are these brands really going out of the market or they will try to come back?
RIchard
Some of the big brands have bigger orders and quantities haven’t just destroyed the factory itself, they destroy the workers, their lives. I can’t see some of these factories surviving so that they’re gonna have to be redundant because no one’s gonna support them.
Sandeep
What about the garment factories, let’s say in Vietnam, all they were dealing with these customers, will they survive this cancellation because it’s huge?
Richard
It’s a terrible thing, because everybody I look at…. just say the UK as a front-end part. All these people at the moment are staying at home and when they start to shop, will their response be similar before the lockdown? Will these big boxed brands survive again? I’m hoping that while people stayed at home, they started to appreciate quality garments. Garments that don’t fall apart because they’re on just the tenth wash. They might have a better understanding of quality. In the future when we talk about quality, then it’s sustainable, and they don’t need to buy that many t-shirts. Who needs that many t-shirts anyway?
Unfortunately, our culture at the moment is about the budget – how much can we buy? How much you feel proud that you just came out of a shop with five items of garments. Just buy one that will last several years. We need to change that mentality, maybe during lockdown people start realizing that it’s good not just to keep spending. I hope, but maybe I’m just dreaming.
Sandeep
We can also get some idea from what’s happening in China because in a way they’re ahead of us. They got the crisis first and they came out of first, so looking at the consumer behaviour there, what do you think?
Richard
They’re very cautious buyers at the moment, which is really interesting, before that they would buy something very similar to Europe. They would buy in mass, a lot of it, but one thing about China was they weren’t just buying the cheaper garments, they were buying the expensive stuff in mass as well.
So they have the money behind them, and this is one thing about Hong Kong, our tourism from China was one of the big things that kept our economy booming. Then because we’ve had trade war, the protesters and corona we are not seeing many mainland buyers shopping. They feel quite threatened to come to Hong Kong and then that’s another political problem that we’ve got to look at, but Corona has definitely pushed the barrier that’s affected China’s shopping slowing down. People are going shopping but very calm and responsible, and they’re not buying huge quantities.
Sandeep
Do you think online retail will win ?
Richard
I think obviously the digital platforms, not just the shops but shops online. I think that they’re definitely going to have the advantage just because people are gonna be so scared to touch people. They just order online and all of a sudden they can get the garment that they wanted. So I think the pros out of this is that the digital world will be the winner, but also on the supply chain we can’t do everything digitally like the shop. At the front will be pushed more into the digital age but the supply chain still needs to be handled by a person.
Sandeep
So this is from the consumer side and as you said I believe also In the USA and EU that the consumers will be reacting cautiously and probably as you said that quality will be the key for consumers if they’re buying less, they will buy higher quality.
Richard
I hope so this is just my personal thing that I just hope that people realize that buying this fast fashion is not healthy. It’s not good, even when we go into the sustainability side and how much garments we dump into the landfills. I read an article the other day that 95 percent of the garments could be recycled, but we only recycle 5% globally
Sandeep
That’s really sad, even from the fresh production. I believe that 15% of the production is actually going to the landfills without being used.
Richard
I actually had a question, we ‘ve rapidly need these face masks and that they’re needed in society to stop the spreading of corona. Are they made in a sustainable way? Are they made with fabric that is tested? When we make the garments we make with compliance at mind? Can that fabric be recycled as an end process? Is there a circular market?
All of a sudden, I see all these big orders of 10 million masks here, 10 million masks there. Have we done the same research what we do in the supply chain to make the jeans? Because I feel in a year, two years, are we gonna see face masks floating in the ocean instead of a coca-cola bottle?
Sandeep
One new point looking from the retailer point of view: what right now in touch with the designers like you and are asking for new products to be developed, so have they changed their requirements in some way to let’s say to have special finishes in the garment or the special characteristics?
Richard
Basically, at the moment a team is staying at home for the last month so on our side I couldn’t say anything that we’ve gone in that direction. I do know when I’ve been in the laundries that there are several chemicals that are on the market at the moment. People are testing whether it’s antibacterial, reducing bacteria as well as fungi. Must be some kind of fashion kind of driven trend because I still don’t think it has any connection to stop corona, to be honest. Corona is such a small kind of virus it’s gonna go through any fabric that we’re gonna produce especially in the denim field.
Sandeep
What changes do you see in the industry in coming one year?
Richard
At this moment, I think the influence of people being inside is going to be reflected on their denim types and I think it is gonna be darker which I feel is just a comforting kind of colour. That’s just me, I prefer darker indigo to a light indigo. I feel like the lighter coloured indigo shows dirt easier. I can see dirt on darker indigo, even though it might be dirty it’s still crisp and clean looking. It might not be, but it still looks comforting and right going into autumn-winter.
I feel that the internal of the Jeans will be essential and could be brushed. So it’s more like quilting and like being in a cocoon. Simulating wearing your pyjamas, all the time. You know that connection, I feel might be a trend. More stretch and super stretch denim might be seen more as well for comfort.
Sandeep
Any other positive you see from this situation?
Richard
The positives are that it’s opened up the supply chain and makes it a bit more transparent than before. It’s got more transparent and shows the customer’s loyalty. Do you really want this type of customer in your portfolio for the future? This is positive even though it might be a cynical twist. In the end, I want to be transparent or totally visible to all our customers, if there’s a problem we can fix it together. If I’ve got a demanding customer and the supply chain is not transparent, then we have a collapse. It doesn’t matter how many units they might place, if you don’t get paid, you still get zero profit!
It’s useless if you run your factory and place all these garments in the lines but don’t get paid. It’s a good thing where we got all the help from the mills. Being very supportive and obviously, that’s gonna be a positive link in the future. Relationships will be together on the back end.
I’m hoping that there are really good brands and companies in the front end that keep the alignment of the supply chain. Everybody looks after each other and doesn’t just look singular. I also think that the supply chains might grow in the countries where they designed. Corona has basically made it transparent and shows the weakness of globalization supply chain in production. For example: If our production closes due to a natural disaster. Having a closer source reserve reduces the carnage of the ripple effect in the supply chain. I think we should think about this for the future. I don’t think it’s gonna be a huge thing unless we’re more dynamic.
I think the customer will feel more gratitude and feel humble that it’s made in their country as well.…..I’m trying to come up with a word here, just homegrown and they’re not relying on Shipments that take more than 30 days just to ship. I think it’s an exciting kind of future for us all. I think because of this breakdown in the supply chain everything is up in the air, so we need to be dynamic, but definitely, you have to stay together, we’ve got to work together as a team!
Sandeep
I think the relationships will probably be more deep and stronger ,even in terms of buyers and suppliers. They also would like to work much more strongly with each other.
Richard
Absolutely, all of us need to trust each other, and I could say the positive is that the names of the bad guys are not getting away. They are being exposed, showing the world how they have mistreated their supply chain. I just hope that the customer understands and sees and feels what we have to handle. Maybe they think “Oh where’s that wonderful brand that we used to buy lots of garments from…. oh, it’s gone, bankrupt!
I want them to change their mind and to appreciate what they’re buying.
Sandeep
You’re absolutely correct so it has been a lovely discussion with you Richard, so many insights from you because you are so much so connected to the whole all the segments of the supply chain, you know and so deeply for so many decades so it’s lovely to have your views.
Richard
Oh thank you thank you
