Founder’s Letter: Kingpins Exchange
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New technologies, and changes in paradigms always cause serious and memorable decision making. On Nov. 6, 1980, IBM agreed to pay Microsoft $430,000 for what would be called MS-DOS. But the key provision in that agreement was the one that allowed Microsoft to license the operating system to other computer manufacturers besides IBM — a nonexclusive arrangement that IBM agreed to in part because IBM did not believe in the personal computer. Simply put, IBM were large main frame computer producers and felt their business and model would never end. Furthermore, IBM viewed the personal computer as being for homes and kids and not a competitor to serious business computing.
The train industry looked at the Wright brothers and their developing invention which they called the airplane from afar. Right from the beginning of this invention, the train industry had to decide, “are we in the transportation business or the train business?” It was the same decision IBM had to make.
If the answer was that they were in the transportation business, it was obvious they needed to invest immediately in airplane development. If they decided they were in the train business, then the airplane had to be regarded as a competitor and business foe.
We all know the train industry, like IBM, made the wrong decision and considered the new tech as unimportant and allowed their own businesses to crumble by making the wrong selection of the future. Think of Netflix suggesting to join up with Blockbuster and Blockbuster laughing at the offer.
The same thing is going on with Kingpins Exchange, our digital platform that was created in partnership with Material Exchange. Some people are not really getting it the way they should. Digitalizing our industry is natural, obvious and necessary and was happening with or without COVID-19. In fact, Material Exchange was created and had initial funding in 2017 because the need was so obvious.
I can’t stop thinking about how many emails we all receive or send each day asking questions where the answers should be in the public or customer domain. Digitalization stops questions like “What is the price, or the width or composition?” It stops “Is this product cradle2cradle or is the cotton BCI??” Eventually it can end “Are you on time?, Do you have sample yardage available?” etc. etc. etc.
All textile mills have their product data in their computers. What is needed is for that data to be taken out of their machines and put into a form that customers can use. What use is data in a textile mill’s computer to the buyer? One of our denim mill customers recently realized with our Kingpins Exchange, their overseas salespeople could see historical samples of what their mill made years ago, enabling them to sell more because they could find previously-made things they love.
We have ambitious plans for our Exchange platform. In March, Kingpins 24 used Kingpins Exchange to host their digital event. There were annoying bugs in the release because we went public too quickly and were too ambitious but there are always bugs in new technologies and no matter how prudent you are the bugs come. Now the software has been upgraded and the bugs should be gone although it is conceivable, that one or two minor ones could still appear.
“It’s always a difficult decision to say yes to something when there is a rush, and your natural inclination is to please your audience and push your team to the brink. Our partnership with Kingpins suddenly thrust us in front of thousands of denim mills and buyers, who have different expectations. We have learnt a lot in a short time and will improve together” says Darren Glenister, CEO Material Exchange
Now we are moving on to inventory. Imagine this because I can’t stop thinking about it. Imagine the whole global denim industry putting their inventory online.
When I worked with FIT annually for 15 years, students would ask me in the most genuine, earnest way, “Mr. Olah, what is the most sustainable thing we can do with jeans?” My reply was always the same, “Never buy new jeans or anything new. Buy used jeans, used furniture, and used cars. Nothing new. Always used. The only new things you should buy if you seriously wish to be earth friendly is toilet paper and underwear.”
Probably the next best thing to do besides wearing jeans that are used is to manufacture jeans from fabric that is already available– in stock. We are working diligently on what we call “LiveStock,” where we will create software that mills can use to load in their inventory. In keeping inventory fresh on a daily/weekly basis, buyers globally will not need to buy new fabric, but can look online and see where fabrics are available in every country.
And then we are also working on order protocols. “What if” are two of my favorite words. What if Kingpins Exchange went past ordering samples or stock and extended its help to garment factories in organizing online denim fabric delivery and quality protocols with regards to master shade, shade blankets and shrinkage etc.? What if our system helped all mills see and follow the best possible steps in delivering best in class denim?
Currently every garment factory and every mill have alternative relationships and protocols. The truth is that there is a right way to do things, and everyone should follow the one right way that is the best way. A digital platform will do that and just like a Youtube video teaches you how to put Ikea furniture together, Kingpins Exchange can help garment factories by showing and leading mills through the perfect workflow online.
Imagine the day when buying and paying for denim will be like buying a book from Amazon. That’s the view we have in our heads and that’s a lot of amazing people working on bringing this vision to life.
I hope everyone has a great month. See you soon,