Luxury Goods: French Fashion Freight [PODCAST]

 

 

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Chris Parker: Hello, everyone, and welcome to The Expeditors Podcast, where we look at the logistics and freight forwarding industry through the lens of a global logistics provider. I'm your host, Chris Parker, and today's topic is high fashion freight. This week, it's Paris Fashion Week, where the world's greatest fashion designers show off their latest ideas to buyers, publishers, and retailers. Now, the pieces shown off can hold extreme value, so as a freight forwarder, how do we support French maisons or houses to get their products to customers worldwide? And what goals do they have as global brands? Joining me today from Paris are Global Account Manager Sophie Duquesnoy and District Manager of Paris Marc Rached. Sophie, Marc, welcome to the podcast.

Sophie Duquesnoy: Hi, Chris. Very happy to go over this topic today with you.

Marc Rached: Thank you, Chris, for having us.

Chris Parker: It is my pleasure to have both of you. So I know we've got, okay, this sounds like a really cool topic. I'm actually really excited to talk about this one today. But before we get into that, I wanted to get to know both of you first a little bit. So, Sophie, starting with you, could you walk me through your career and how you got to where you are today? And what do you like about supporting these fashion maison or these houses that you work with?

Sophie Duquesnoy: Yeah, I would say that I'm a pure baby of Expeditors. I'm 20 years with the company and just joined the family after high school. And I went through the different departments and learned a lot. And joined the account management program in 2006, and it was really something that fit me. It's a pleasure to work with the customer; it's really what fit to my personality with Expeditors. And I was all the time with retailer customers, and the nice thing about being an account manager at Expeditors is really that you have different customers, and each time it's different. You always learn. Always learn.

Chris Parker: Then, what would you say is the biggest lesson that you've learned from your time?

Sophie Duquesnoy: It's adaptability and resilience, I would say. Through the different customers, different industries, and different expectations, everything is always new. You build each time with your new customer, and you learn a lot with them on their supply chain approach, their vision, and even the company itself.

Chris Parker: Fantastic. All right, Marc, your turn. Walk me through your career and what you do as a district manager. What do you love about working with fashion houses?

Marc Rached: So, I've been with the company for 19 years. I started in the Middle East, so I've worked in different offices, and I've been based in Paris since 2013. So, my responsibility is to oversee the operational part as well as the development part in the territory of Paris. And I work a lot with Sophie and other stakeholders in the district to support our clients in the high fashion industry.

And I've learned a lot because, well, obviously, Paris is the epicenter of high fashion in Europe and globally. So, that interaction and that exposure taught me a lot. One thing I've learned, and the most important thing, is no client has the same requirement. Never take things for granted. Always be proactive and very reactive. It's a highly demanding industry. People are facing a lot of stress, whether in the logistics or in the creative departments. They are all facing tough timelines and tough requirements. So, we have to be there for our clients, and it's a totally different industry from the other industries that we serve.

Chris Parker: Cool. Well, with that, let's go ahead and dig in because I want to know more about these requirements, too. But first things first, when you look at high fashion, how do you define it, and what do these products and pieces look like? Marc let's start with you.

Marc Rached: High fashion is all about luxury, beauty, finesse, and elegance. It's about products that everyone desires, but not everyone can afford.

Sophie Duquesnoy: It's a lot around all the design, the innovation, and the creativity that are brought by all those luxury designers. I think it's all around like Marc mentioned, a desirable product. It's a lot about that. And I think also the high value may attract people, but the high value is really based on the quality and the long-lasting product. And also, a kind of heritage of the different maison and the culture and the art that they want to put in their product to make them very attractive.

Chris Parker: So, when an event like Fashion Week comes around, what does it mean to the fashion world and French culture?

Marc Rached: It's a highly awaited event, whether in France or internationally. It brings a lot of attention, whether it is from the local or the international media. One reason for it is because it showcases French creativity, buyers then set the tone for other creators on what the fashion will look like for the coming season. So, it's highly awaited, and it gets a lot of coverage from the media.

Sophie Duquesnoy: Yeah, it's a lot about branding. We want to be the leader in the luxury market. So, all those maison, that's really the time that they want to show the prestige of French art, and that's their moment to shine, I would say.

Chris Parker: All right, so Sophie, let's start with you for this one here. What kind of factors are drawing the most attention from high fashion brands today? What are they most concerned with nowadays?

Sophie Duquesnoy: Yeah, and just as a quick intro for me, it was important also to highlight just the revenue that was generated last year for the global fashion industry.

Chris Parker: Yeah, please.

Sophie Duquesnoy: We are talking about $1.5 trillion last year. For me, post-pandemic, there is a change. The supply chain really rethinks the priority for the fashion and luxury industry. Of course, they are looking for a more agile supply chain, and that definitely now integrates more of a sustainability approach into their business model.

What we have seen also is that the younger generation is really expecting more transparency on the sustainability program that the different brands can have. This generation also creates a revolution in the speed up to the pace of the luxury industry.

For me, there are two new fundamentals now for the industry: the value of time and sustainability. Also really important is that they're expecting those maisons or those brands really to have an ethic, really an ethical governance that also includes compliance. And if we are much more in a technical aspect, I would say everything that is also around the regulation and the customs regulation that we have.

And we were talking about branding. For me, it's key for the high-end fashion brand. And this means that for them, they must achieve to have a branded supply chain. Because it's not only having products that are desirable by people, but they need to have an excellence in the distribution. And this also goes for the supply chain model.

Chris Parker: I love that a branded supply chain as if each fashion maison does things in a very specific way. They've got their own style of moving their goods around. I think that's a really cool idea. Marc, what about you? When you work with your customers, what are the kinds of things that concern them or that they are really prioritizing right now?

Marc Rached: High fashion customers are convinced that having an efficient supply chain is crucial for their development. Making sure that their shipments and their products are moving in a safe environment and especially in a compliant manner. There are a lot of restrictions. There are a lot of regulations that surround some of the products, especially when we're talking about animal products or other origins that can have certain restrictions in certain countries. And when you're a famous brand, sometimes bad news hits the press really quickly, and we want to make sure that the image is protected, and that is an important factor for the continuity of the brands.

Chris Parker: So, I guess then, how does the fashion industry engage with logistics? And what are the particular needs that it has to move these kinds of products?

Marc Rached: Security is very important for our customers. They do feel that those products are recognized almost everywhere, and everybody wants to have them, and unfortunately, not anyone can afford them. And it is very important that the supply chain is secured from end to end. So, that's the first requirement. Reliability and the security of the supply chain.

Another thing that is important is the visibility. Having an integrated supply chain, whether with your forwarder or with your service provider, is very important because customers are very anxious and very eager to receive their goods. The last thing you want is not knowing where they are, having them delayed, and having, at the end of the day, an angry customer who might go to another brand. So, I would say those are the most important factors. Sophie, anything to add?

Sophie Duquesnoy: Yeah. I totally agree with what you said. The visibility and the security are crucial for those fashion supply chains. And also, I would say that as they are very integrated because it involves design, then they have to do the sophisticated manufacturing. They also use transportation plans. So everything has to really connect and be efficient in this regulation worldwide. It includes adopting a faster process and doing so urgently. There's no room to fail for this kind of product. They really need to have the expectation of the customer for the product, but they have also to continue the unique experience until it's delivered to their final customer. And generally, you have, like Marc mentioned, we have to deliver the high-value product sometimes in a hotel or for a trade show or for shooting photos. So, it has to be done really in a secure manner.

Chris Parker: Sophie, you brought up a good point that they're delivering to either hotel; they're delivering to, it sounds like, a lot of temporary locations. These aren't just regular warehouses that they're bringing in product to where it's going to be there for years and years. These final destinations change constantly, so we need to be accurate with where we're delivering them to. That, with you calling out an integrated supply chain, leads me to believe that a fashion maison does not work with a lot of service providers. Is it common for a fashion maison to have its own delivery service under them?

Sophie Duquesnoy: No. They really rely on service providers. And yeah, they generally have a long-term relationship and confidence. We know that in this industry, it's a lot on reliability, and they expect the service provider to cover all this, I would say the transportation and logistics part. The maison are working on everything that is design, creativity, and innovation, and they partner with service providers to be excellent in the distribution of their product covering those different aspects.

Chris Parker: So, they're working directly with their service providers quite frequently, very closely. My next question for that one is, what role does a freight forwarder have to play within this environment? Because I mean usually, we're the ones who are working with the service providers on behalf of our customers, so what do we do for a fashion maison?

Marc Rached: I think it starts most importantly with understanding well the requirements, what do they need, when do they need it, and how do they need it? And those requirements are very specific when it comes to high fashion. Not every transporter can commit to that, so they would need a lot of flexibility, a lot of innovation, and a lot of reactivity from their partners.

The human factor is very important because the relationships that are built with our customers are relationships that last because they go through a lot of challenges. And that experience and sometimes failures and successes create a strong bond, and that bond is something that will last for a long time. So, I think, most importantly, the industry looks for reliability and an understanding of their sense of urgency. And also, very important to note that even though these are expensive products, it doesn't mean you have to pay a million to move a bag or a shoe, which still there are a lot of constraints on cost on sustainability, and you have to adhere to that.

So, there are a lot of requirements from the customers, and it takes time to understand those. And it's not just about moving a shipment from point A to point B. It's everything that happens before that shipment is ready: the products are ready, the planning of it, making sure it's moving in a secure way. Once it gets to its destination, final destination, all that compliance part, making sure it goes through customs in a very compliant way, but you have to make sure all this is ready before even the products move. So, there's a lot of proactivity that the freight forwarder should demonstrate in order to make sure that that movement is successful.

Chris Parker: When I'm looking at the types of things that show up at Fashion Week or at the MET Gala, these outfits, dresses, and suits take all sorts of different forms and shapes, using all different kinds of materials to put them together. How hard is it to classify high-end fashion when you're trying to get your customs in order?

Marc Rached: It's very tough. It's very challenging because these are not common products. Those products have just been released, so there's no historical data that you can use. Classification sometimes can differ on the color, size, and whether it's high heels or small heels, it's five centimeters. So, once those products are released, there's a lot of work to be done to make sure that each product has the right classification.

Sophie Duquesnoy: The complexity is also because, as you mentioned, it's a prototype or a really unique piece. And then, when you have to classify or ask a consultancy to classify those products, you need to provide a lot of information. And that's the more complicated things to do and can be classified differently depending on the market they are going to, let's say, the US regulation and the Chinese regulation. When we are talking about fur specifically, this is the very difficult part for the maison for this unit piece to have the right classification.

But generally, they got the support of the consultant person and with the customs authority. Again, when they know and have confidence in the brand and the name of the company that they are working properly and what they are doing, they work together with the customer authority to confirm what has been classified. But yeah, I would say the complex thing is the fact that it can be a unique product that has no history. And also depends on which market it will go to and the customs regulations for each of the markets based on the product itself.

Marc Rached: It's an excellent question on classification because it'll also bring out another aspect of the logistics and the day-to-day that we deal with, which is communication. Because once source products are made available, then you need to identify what is the right HS code and what classification will fit to that product. And that information usually is available to many people within the organization. So because you have to check what is the origin of the raw material, what is the percentage that is used from that particular raw material? So, it pushes the forwarder or the customs broker to be very proactive but also to be very reactive from the moment those products are made available to make sure that they capture and ask the right questions to every stakeholder within the organization. And sometimes, it's more than one person, and sometimes it's in different locations as well. So, it requires a lot of coordination when it comes to getting that information available.

Chris Parker: Sophie, you mentioned the younger generation now with their greater expectations from the fashion industry with transparency and sustainability. Talking more about customs, what kind of compliance or regulatory challenges does high fashion face that requires so much of its attention right now? Is the industry changing, or is the compliance changing?

Marc Rached: Given the high value of those products? There's a lot of scrutiny when it comes to customs. In a sense, customs authorities want to make sure that those products are authentic, and they are what they claim to be in terms of the material that is used for production. And most importantly, the valuation of those products is correct. The biggest challenge is CITES. They want to make sure that they have the right licenses and the right documentation for that. Perhaps you want to talk about that, Sophie?

Sophie Duquesnoy: Yes. CITES is in fact regulation of the animals and species that are protected. My thought is that with a much more approach in terms of environment and protection, there is much more regulation on everything that is around animals and nature. And then it asks those high fashion brands to be much more compliant and to have awareness of what is able to be done or not anymore.

If we take the example of, let's say, California, you cannot send some crocodile belts because they are totally under protection. So, in this sense, they had to be much more compliant than before. I'm not sure when those CITES regulations started existing and the protection around those species and protected species, but definitely, it has an impact on the high fashion industry to be more cautious and more compliant on what they were using as raw material. They cannot let the designer do everything that they want to do like before. Now, they have to be compliant with the protected or new regulations on the environment.

Chris Parker: I recently learned that fashion labels want to be able to provide; they want to make their products available to the market within 48 hours of announcing or releasing a certain piece or showing and presenting it to the public. With speed to market being part of this luxury experience, how are they making changes to better meet their goals, but then also still keeping this luxury experience available to its customers?

Sophie Duquesnoy: Those fashion brands have made sustainable development a strategic priority for years now. It's true. They want to deliver to their customers or their stores or give a very VIP experience in 48 hours, and then they have to be also neutral carbon. That's an objective. But they have to find some ways, I would say, to minimize or decarbonize their supply chain, particularly when they are using the air mode of transport. So yeah, there is some initiative that has been done. We can talk about the SAF fuel; I'm sure that you have heard about that. But this has helped to buy biofuel and then reduce the global CO2 footprint on their overall movement by air.

So, they have done top priority, but it's not only on the transportation. They also have a very high target in terms of sustainability, and they work on everything that is packaging. They want to make sure that all their production sites can be carbon neutral or have a very high-quality environment. And they developed a program around the environment, and they had an objective for 2030 to have 100% of their new products will result from sustainable raw materials. The wine and spirit sector worked a lot because we have seen even this year with the climate and the water that was missing, they try in the vineyard to use also some sustainable way to reuse water and minimize the consumption of water in their vineyard.

Marc Rached: One thing that is also important is that every customer is challenging us for the most sustainable solution. Sometimes, it might not be there, but what we can see is that they are always on the lookout for what is the best way and most eco-friendly way to move their products. This might be asking us to use electric trucks, asking for different modes of transport that can meet their requirement. But there's a lot of work to be done to attract the younger generation who is very self-conscious and conscious about the impacts of global warming and are looking for products that are more sustainable and eco-friendly. We're still not there yet. There's a lot of work to be done, but it's still a challenge given the fact that you have this speed to market and that the product needs to be available as soon as they are released.

Chris Parker: With high-end fashion products, we're looking at one single item, some with long histories, and therefore tracking is important. What is the latest with keeping these high-value shipments secure?

Marc Rached: I would say the most innovative thing that is happening today in the market is real-time visibility, understanding, and knowing exactly where those products are in real-time. And that would reassure our customers, but also, it'll reassure their customers knowing that at any point in time, they can locate their products or their purchased goods. And it's not about just the standard visibility. There are solutions being put on the market, whether it is packaging or tracking devices, and those are becoming very handy and very much used and consumed by the high fashion industry.

Sophie Duquesnoy: We have a team that is trained and skilled to orchestrate those high-value cargo movements. In fact, the concept is we never take our eyes off your shipment. So, for that, it'll be a human, and it'll be, like Marc mentioned, that innovation with the device. But this is definitely monitored 24/7 and it can be around, depending on what the requirements are and what is the type of product, but it can be a security escort or a corridor routing that is agreed with the police. Can be overpacking with sealed, not seeing what the kind of product is. And using those cargo sensors, we can have real-time data. And you can even have that on the map of your phone at any time. You can see exactly where your cargo is or where your product is. So, we have a kind of package of different security measures that can be deployed, depending on the expectation and maybe the high-value cargo. But it's a lot about a team orchestrating everything around that.

Chris Parker: All right. Last question for you guys here. We've been talking a lot about high-end fashion, the luxury experience, and the specific needs of this industry. Why is it important to know how these kinds of products are moved? What does it matter? Why should any of this be important to the retail customer, the common folk as it were? This whole world, the high fashion world, is inaccessible to me, right? I'm never going to buy one of these things. Why should I care about what we're talking about today?

It's a pretty deep question.

Marc Rached: I would say it's very interesting to see the standards that are in place because of that industry when it comes to security when it comes to moving shipments end to end in a secure and compliant way. They set the standards really high when it comes to customer requirements. It would be inspiring for others to see how this is being done and the amount of resources and effort being put into it. Whenever you see a nice bag in the display, it's not just someone who grabbed it and put it there. There's a lot of work; there's a lot of people who invested to work tirelessly to get this bag on display. It might not interest a lot of people, but it is also an industry that has an impact of $1.3 trillion on the global economy. There are a lot of people who work in that industry and gain their living because of this. So, even though the products are not very accessible to the common people, it's still a very important driver in the economy.

Sophie Duquesnoy: It's the French prestige that is showing there with this industry. And we need to keep in mind that they create something. We are talking about craftsman, artisan. We are talking about the heritage of savoir-faire. There are many French words, but that's what we want to show.

And when we have this fashion week, it is to show what France, Paris, and the different fashion brands are still able to create as heritage of value and art. And we need to keep that. And that's still something that is important for the world. Also, this fashion industry because it attracts a lot of people around that. And it generates a lot of pride. But also, the high fashion industry, they hire a lot of people, and they train those people also. They even create a program that's open to everyone, and they really want everyone to have this success in high fashion. It can be any person. And then you have a mix of celebrities that are now, and we take the example, but we can have celebrities be the edgery of this brand. And so, for me, it's much more like a kind of recognition of French art, culture, and heritage, but in high fashion. It can be with the music, but we are talking about high fashion.

Sophie Duquesnoy: And everybody has to wear something every day.

Chris Parker: Thank you, France, for everything that I wear.

Well, Sophie, Marc, thank you so much for the time that you took today to chat with me about this. This was really a lot of fun to talk about.

Marc Rached: Well, I really enjoyed that discussion. Thank you for having us, Chris.

Sophie Duquesnoy: Yeah, thank you, Chris.