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HSBC’s Serai, a tech-based solution built on Google Cloud to cater to the trading needs of SMEs, has partnered with two digital applications for the fashion industry, Coats Digital and Res.Q, to reduce inefficiencies in clothing supply chains as the Covid-19 pandemic batters apparel trade.

“The apparel industry has been devastated by knock-on effects of Covid-19 and requires a reset,” says Vivek Ramachandran, CEO of Serai. “The industry must rebuild relationships and respond to new demand patterns that will emerge as part of the new normal. This will require retailers, brands, manufacturers and suppliers to increase their digital engagement, make new connections, share more information, and systematically address pockets of inefficiency across the supply chain.”

Launched in February 2019 and led by Ramachandran, who left his role as global head of growth and innovation at HSBC to run the project, Serai is a B2B platform where suppliers and buyers can search, find and connect with each other via their trusted networks.

Coats Digital, developed by industrial thread company Coats last year, is a suite of software solutions that streamline end-to-end processes, from design, material and product development, to supplier capacity management and purchase order tracking. Res.Q, set up by Sri Lankan apparel manufacturer Hirdaramani Group, is a cloud-based quality management application.

The partnership will bring these solutions together on Serai’s digital platform, providing the apparel industry with real-time data and end-to-end supply chain transparency at a time when it has been hit hard by the virus.

“Companies are going to have to find ways to showcase themselves digitally, they’re going to have to share data digitally, and that is with existing buyers but also with new buyers,” Ramachandran tells GTR. “How do you choose a new supplier when you can’t visit them and you can’t do full audits? In a world of tighter margins, how do you stamp out inefficiencies? How do you measure productivity and minimise wastage and rejects? How do you mitigate the risks upstream and downstream with buyers and sellers? The industry is going to have to start using data in a much smarter way, and this partnership offers a means through which companies can do this.”

The partnership is also exploring risk mitigation and financing propositions that capitalise on the data that emerges from these digital solutions, but Ramachandran is keen to stress that the initial focus remains on digitising the physical supplier relationships. “If you can’t digitise the underlying trade, everything else becomes a sideshow. You have to get to the underlying business being digitised, and only then, whether it is risk mitigation of financing, can everything else follow on the back of that,” he says. “The ability to develop innovative financing solutions is going to be enhanced hugely by having much more transparency into production and data.”

So far, Serai counts as members apparel companies from around the world, including Turkey, the US and the UK. Ramachandran says that the platform will continue to focus on the apparel industry throughout 2020, and will then expand organically into adjacent industries.