FASHION MADE: On-Demand Manufacturing with UNMADE
In this interview, Hal Watts, co‑founder of Unmade, explains how the London‑based SaaS company enables fashion brands to offer on‑demand and customizable manufacturing through a cloud platform that manages the entire order‑to‑production workflow. Watts describes Unmade’s evolution from a consultancy to a VC‑backed software business, highlighting the heavy investment (£7‑8 million) that allows brands to access technology cheaper than building it themselves. He discusses why on‑demand production is becoming critical as the fashion industry struggles with overstock, waste, and margin pressure, citing examples from ASOS, H&M, and Burberry. The conversation moves to the limits of current “pick‑and‑mix” customization and the potential of true custom manufacturing, where each product is made from scratch per order, enabling richer brand experiences and localized design variations. Watts stresses the need for brands to rethink design as parameter‑based rather than static, and to set guardrails that preserve brand identity while allowing consumer input. He outlines the cultural and change‑management challenges of shifting to an on‑demand model, noting that sustainability is a compelling business case only when it aligns with customer demand and profitability. Finally, he shares performance metrics (3‑week to 5‑day fulfillment) and envisions a future where most fashion is produced post‑purchase, reducing waste and improving cash flow.
Chapters
I'm here with Hal Watts from Unmade. Hal, hello!
Hi there.
How you doing?
Good, thanks. How are you?
Yeah, very well, thank you. For those who don't know what Unmade do, could you give a brief explanation?
Sure. So Unmade is a fashion software business based in London, and we build software that enables brands to offer online on-demand and customizable manufacturing.
Okay.
So that could be the typical user experience, something similar to Nike ID that a lot of people will be familiar with. So offering everything from the front-end solution to that, to how we then manage the flow of all of the orders, organize and structure it all around production, generate production data, and then ship from factory to consumer.
Okay.
And there's also a number of other ways that could be used. So it can be used for on-demand production that isn't custom as well.
Okay, fantastic. So, which kind of brands are you working with at the moment?
Yeah, so I can't talk about most of the brands by name that we work with, but in— That's usually a good sign. Yeah, yeah, yeah, everyone— no one wants the others to know, which is a good thing.
Excellent, excellent. Is it going well?
Yeah, yeah, so I, you know, of the— we've got, we have contracts now with 3 of America's 10 largest brands. Using the technology, and a number of other European brands. So that gives a kind of flavor of the types of people that are using the technology.
Yeah, really good, really good. So how was that jump from consultancy to suddenly being a software company? Was it a big leap?
Yeah, I mean, it's interesting because, you know, when you are a consultancy business, you're basically profitable all the time because you bill out yourself at a day rate and you do work for people, whereas as a SaaS company and a VC-backed startup, you're inherently building an unprofitable business with the goal that at some point it becomes highly profitable. So, it's a very different way of working. But I think for me, the interesting thing is it means that you can invest far more in the technology than what your customers are paying for it. You know, at Unmade, we've invested over, over £7-8 million in the software that we sell to our customers. And we're able to sell that to customers because it's SaaS and because many people use the software. They're able to get it at a much cheaper price than if they tried to build it themselves or if we weren't VC-backed.
Yeah, yeah.
So I think, you know, ultimately a VC-backed company is a company that's able to build stuff that is very hard to justify a company building themselves internally.
Yeah, yeah. It's a very exciting world. Talk to me about on-demand manufacturing. Why is this so prevalent now?
Yeah, so I think interestingly, it's not yet. It's getting there.
Like, I'd say in the last 6 months, I guess that's in my world where I'm constantly dealing with sort of the intersection of technology and manufacturing within apparel. But I guess you're right, in, in the general scheme of things, it's—
I think it's becoming very prevalent in terms of what people are talking about. In terms of what people are doing, it's almost nobody has even put their toe in the water yet, I would say. There's very, very few companies doing on-demand manufacturing. But everyone's now talking about it. You know, José, the CEO of Farfetch, did an interview this week where he said that he thought it was the whole future of the industry depended on demand. You've got companies like ASOS coming out with massive profit warnings because they're not able to get rid of the stock and they're having to discount it. H&M have announced this year they're sitting on 4 billion of stock that they don't know how they're going to sell.
So Burberry are burning theirs.
Burberry are burning theirs. So you can see that there's, there's clearly an issue with the industry, which is that the way consumers are behaving doesn't match the supply chain we have available today. And so I think the reason the whole industry is starting to talk more and more about on-demand is that it's becoming really, really obvious that it's essential for the industry to survive. And actually, the reason we've started with customization and we focus on customization is because that's something that the industry is already doing. And if you think about a customized product, it has to be made on demand. You have no choice but to make it on demand. So it's a really good testbed and a really good environment to really mature the technologies that are going to be needed to do on demand at scale. Because, you know, if you imagine the way a brand works today, customization, you know, if you do a lot of custom, it might represent 15-20% of your business. But for most companies, it's a lot less than that. And that is going to grow and it's a decent market. But the really interesting thing about custom for me is that it showcases the future way everything will be made. That's how we're going to have to make everything if we want to preserve margin within the industry. And that's without even talking about the waste issues and the kind of sustainability issues around that. Even if you ignore those, you know, currently most fashion brands are experiencing drops in profit margins, not increases. And a big reason for that is not selling. I mean, the way we talk about it on MADE is saying it, and it seems quite boring or basic, but to say fashion driven by demand, which you'd think, well, fashion is driven by demand, but it isn't because the way the industry works today is 9 months ahead of time or 12 months ahead of time, someone decides this is what we're going to sell in 12 months. And then they make it, store it in a warehouse, and have to market it and hope they got their guess right. And that means you have to overstock everything so that whichever guess was the correct one, you've got product for. So it's not driven by demand, it's driven by guesswork on significantly ahead of market. For it to be driven by demand, you have to significantly, by an order of magnitude, accelerate your supply chain. Then you can truly drive it by demand. So you only make what people are buying and you only sell what people want. And like, that should be the goal. And it's kind of weird that it isn't already the case, but it isn't.
No, no, it's driven by supply, as you rightly say.
Yeah.
You know, people brainstorming a year in advance thinking what, you know, AW20 is going to look like. Yeah. Do you think that the fashion industry, and I'm talking about maybe the more fashionable side of the fashion industry, is ready for that change? Or are they going to cling on as long as possible to this current model?
No, I mean, I think we have to be honest in the fact that the fashion industry is probably behind a lot of other industries in this regard.
Undoubtedly.
And I don't know why that is. I think it's because it's— I think it's because over the last 50 years it's built quite a separation in its supply chain. So you have brands who design product and who retail product. Then you have factories who make the product, and they're very divided by, you know, geographically, but also in terms of the way they operate. And I think the main conversation between brand and factory has been, how can you make that cheaper? And that isn't how you foster innovation. Um, and I think a lot of the success of the sportswear brands is that they've been able to have a different conversation with their suppliers. I mean, undoubtedly they've had that conversation as well, but they've been able to develop products that differentiate them in the market. Whereas I think increasingly fashion brands, the products they're releasing and launching have tended to uniformity. You know, if you see a product now, I think if you look 30 years ago, if you saw a product, you can have a pretty good guess at which brand it was from. Yeah, there were fewer brands, but also people had differentiated product offering. Whereas as every brand started to use the same factories and the same supply chains, product has— there's more variety of product, but it's much harder to say whose it is. So I think as the industry starts to improve the relationship with the supply chain, I think that will unlock a lot of potential.
Yeah. Do you think the sportswear companies maybe had more of a— they could justify their price a little bit because of the sort of technical side of of their product offering. Yeah. You know, they could justify having their clothes made in, I don't know, maybe better factories or closer factories or having better relationships.
Yeah. I think the reality is probably not that they have worked in better factories or closer factories. It's that their scale has afforded them the ability to have a much bigger conversation around investment in product. So, you know, Nike and Adidas are, what, $20 billion plus turnover businesses? Yeah. So they're 10 times bigger than your average fashion brand. Well, than your top-tier fashion brands. So they've been able to say to a factory, I want you to invest in this type of hardware because I'm going to order so many units that it's worth it for you. But I think more recently over the last decade, the sportswear brands have, have gone to their suppliers and they've— and I think it's because they're from a performance background, they understand that innovation comes from manufacturing. If you think about a fashion brand, I think very rarely they would think of going to their factory for innovation because for most fashion brands, innovation traditionally stems from you know, I'm going to come up with a new silhouette or I'm going to come up with a new pattern or graphic or style. And that— and they've innovated in design and they've been massively innovative in design. But I think this idea of innovation in a technology sense, if you're a fashion brand, has become quite alien, which is strange because a lot of the fashion brands established themselves through technical innovation. You know, you look at Benetton established itself through P-Styling. They were the first business to manufacture, or one of the first to manufacture everything in white. And dye it as they went, which is why they were United Colors of Benetton and all their marketing was about diversity. So they were a business that became the largest knit retailer in the world through innovation, technical innovation. Or Missoni with the zigzag, you know, the reason they could do the zigzag is they innovated in the way they manufactured fabric and that differentiated them. So a lot of large brands today historically were built on technology innovation, like hard technology innovation. But I think very few now still think in that way. I think they think as marketing organizations primarily.
Yeah, they want to create stories rather than, you know, do really cool things and then tell that story.
Yeah. And actually, what's the difference maybe between Nike and Adidas and their growth over the recent 5 years, 10 years into selling within the fashion space isn't that they're better at telling stories than the brands. It's that the stories they tell are more meaningful because they've been able to innovate. So like when Adidas put out a story about using, you know, recycled— this new recycled plastic in their shoes, it's not like they're the only people using recycled plastic, but what differentiated them was the fact that they managed to achieve this innovation. They didn't tell the— I mean, they were good at telling, really good at telling the story, but lots of other brands can tell that story. So I think What brands are now seeing is that if they want to be differentiated in the market, they have to be more innovative.
Yeah, yeah, you have to be different.
Yeah. And if you think about it, when you used to get labels on clothes, you know, in the '50s, if something had the brand's label on it, it's because it was made in their factory. You know, it was a mark of differentiation and quality because they'd manufactured it for you and they put their name on it. Whereas now that's very rarely true.
Yeah.
So they have— so they've different— they've, you know, the way they've differentiated themselves in today's market has been heavily based on branding and marketing. But I think now they've realized that that's got less value to customers than actual differentiated products. So they're going back and thinking, okay, how can we differentiate the product?
Yeah, it's just a stamp, you know, and it does— there's no— it runs no deeper than that, really. Do you now see that on-demand manufacturing customization, this could be a way for people to actually do that?
Definitely. I think customization is still, you know, it's become more common than it was a while ago, but I think we're still only scratching the surface of what brands can offer in that space. I think for me, what customization has been for quite a while has been replicating what Nike did successfully. If you look at most brands' customization, it's what I call pick and mix. It's like part 1's red, part 2's blue, part 3's green, and then we've got a factory full of all of those components, or a warehouse, and after you've ordered those, we'll put them together, we'll stick them together, and we'll make a product for you. And I think the reason that has been is because most customization is custom assembly. It's not custom manufacturing. It's saying you design something and I'll assemble it. And what we're trying to do is really go a step deeper and say, if you want to really offer variety and really give them— because, you know, the interaction of this bit's red or green is meaningful, but it's not super meaningful. And I think if you can go a step deeper and say we're actually going to custom manufacture, so we're not going to hold stock of bits and put them together. Once you place your order, we will manufacture the entire product from scratch. And all of a sudden, I think that offers much more potential in what can be customized and how you can customize. And I think it also then enables you to actually build a narrative around the customization experience and to tailor that for each brand because you can start to make it really different. Whereas if you are doing pick-and-mix customization, there's a limit to how differentiated that can feel. You know, if I'm a fashion brand or a sportswear brand and the options I'm giving you are picking colors of bits, there's only so special that's going to feel and differentiated. Yeah. Whereas if I can really say to you, you know, I can, I can involve you in the story here, I can— you can change patterns, graphics, textures, colors. Then you can start to actually build a customization experience that's relevant to the identity of the brand and relevant to the customer of the brand.
Well, that's an interesting point because some brands have certain signature styles. So, you know, let's take Nike, for instance. If you're doing a Nike ID, it always has, you know, obviously you can't mess with the swoosh and certain elements of the shoe if it's a Jordan or if it's an SB or—
Yeah, yeah.
For other brands who want to keep those rigid elements of design that really portray the brand, yeah, how do you marry that with also a desire to then go like fully customizable, do what you want?
Yeah, I mean, it's super important because ultimately customers are buying into a brand. Then, you know, they might want to change stuff, but they don't believe they're like designers. Yeah, so they need— you have to carry over the design intent. And that's a conversation we have a lot with brands when we work with them is, what is your intention with the product? And how are we going to make sure that not only do we retain your brand identity, but also we build guardrails that mean your customer isn't going to create something you'd be embarrassed by? And I think Nike maybe haven't done that. You know, you can make— you see some pretty hideous trainers.
I've actually made, I think, the worst pair of trainers ever. Yeah, yeah, yeah. When I was like 22 years old. I thought, you know, I'm gonna have a go at this. And yeah, they are horrible. They've got like tartan on them. Yeah, bright yellow inlining.
But I think that's an interesting thought, is that it does mean that the job of being a designer evolves. You go from designing a static product to designing parameters. You, as a designer within a brand, you're gonna have to start thinking about what are the things that can be changed by how much, and how will they be changed to give them meaning. And that's quite a different way of thinking, but I think it's something that is actually not alien to designers at all. You know, designers normally— it's not that they run out of ideas, it's that they can only afford to make 20 pieces in a collection because they need to do it at scale and they can't afford to distribute more and more pieces. It's not that they don't have ideas. You know, your average designer's got 10 times the ideas of the products they want to make.
Yeah, yeah, yeah.
And I think by building an on-demand supply chain, that's how you could actually deliver that. And even if you were a brand that didn't want to offer customization, today you're offering, you know, every brand's global, and the idea that a customer in China is going to want exactly the same as a customer in Los Angeles is, you know, no one could really, can really believe that. I don't think anyone in a brand really believes that an Asian customer wants the same product as a US customer. But often there's a mainline collection which is sold in both markets. So, so then the question to the designer would be, well, what affordances are you willing to give the merchandising team or the retail teams in Asia? What are you willing to let them change on your design so that it can be a more successful product in that market? Because they know that market better than you do.
Yeah.
And again, it comes back to this idea of designing parameters and what I was saying in what we build is it's not just for end user customization. It can be to customize for an event, for a geography, for a store, and the same tools and the same supply chain can enable that. So all of a sudden you could say, well, my store in Beijing the merchandising people there know that Lumo Green is going to sell really well in the next couple of weeks because, you know, it's this time of year, people like to wear really flashy colors. Your design team in New York or Paris, there's no way they know that. But if you were willing to design a really cool product but then design into that product parameters, all of a sudden your merchandising retail teams are empowered to adjust to that product and make it infinitely more saleable in their local markets. But to do that, you have to have a supply chain that can respond to it because it's useless if those people say, oh, Lumo Green is going to sell really well, but it's going to take us 6 months to get the stock. It's, you know, it's a waste of everyone's time. So the supply chain that you build to fulfill for end-user customization can then also be used to fulfill on other use cases such as that.
Absolutely. I guess what it also helps is if designers do make all of these dozens and dozens of designs, you can kind of put them out there. Yeah. And it doesn't matter if you— there's no risk.
Yeah, great. Yeah, yeah.
And this is the interesting thing, that we're moving into a market of now you design something, sell it, then make it, um, which I find a really interesting, uh, move forward for apparel and footwear industry.
Yeah, yeah, I mean, that's ultimately our ambition as a business, is that if we succeed, brands should be able to make most things post-purchase. I think there's always going to be products that— and, you know, you're always going to have stuff in your store, of course, but you could have almost nothing in your store and you could be replenishing your store every week based on what sells. And there are some brands in the industry that are getting closer to that, you know, there's the classic business case of Zara and how they've been able to speed up the supply chain, but they're still looking at 3 months supply time.
What are you looking at?
I mean, 3 weeks or 2 weeks. You know, some, some products that we, we manufacture from scratch, from order, and get to customer within 5 days.
Wow. In the US, fair play.
Which is, you know, a completely different scale of speed.
Yeah.
That we're looking at. And I think that just opens so many doors for brands to behave differently. But it's a huge shift. You know, it's very easy, especially as a small business, to say to a billion-dollar company, hey, why don't you manufacture on demand? But I think it's important to recognize that there's challenges for them to achieve that. And software is not the only challenge. You know, we think we provide great technology to help that happen, but they also have to adjust the way they think. You know, most brands are massively cash flow negative. They've got hundreds of millions tied up in stock any day of the week, and they have designed the way they operate their business around that. If you're doing on-demand, you're cash flow positive, your customer pays you and you've got cash in the bank before you commit to production. So you have to start thinking of, okay, well, wait a minute, the way I've operated, I organize my P&L is actually going to evolve for the better, I believe. But it is, it is a mindset shift. It's not just a technology implementation. You've got to have a brand that is willing to embrace new ways of operating.
Yeah, well, it's a cultural change.
Yeah, yeah, yes.
You know, and that always has its own challenges. You know, people are generally resistant to change. And so, yeah, after the technology, which can sometimes be resistant to change as well when you're doing tech implementation, Yeah, the people are the next, the next barrier in that. Yeah, but people do come around, you know, especially if they see the benefit of something. And I think that's a big thing with change management.
Yeah.
Is convincing people of the positive sides of doing all of these things. And if they see that it's going to help them and, you know, and it's championed from the top to the bottom and throughout the company. Yeah, these things can be done pretty well.
And that's a big part of what we do when we work with the businesses, helping them manage change, you know, So if it's— if we work with a number of sportswear brands and it's maybe an easier— there's less change to manage because the likelihood is they maybe already offer customization, but they need it, they need a better technology to do it well at scale and to improve their margin. Or it might be that they're familiar with the idea because they do team kits, they might do local team kits or national team kits, so they're right, they're more used to this seasonality, this need to tailor the product for different people. So there I would say there's less of a need for change management. But I think in a classic apparel business, there usually is a little bit of a, you know, why are we making this change? And you have to explain because there's going to be massive benefits to your P&L and also to what you're able to offer to customers.
Yeah, it is. I guess one really Good way of doing that in today's world is telling them about the sustainability benefits because they are inherently, must be huge. Yeah, it's customizing and on-demand manufacturing.
Yeah, definitely. I mean, I think, I think it depends on the brand. I think from, from my experience being a bit of a cynic, I think brands only care about sustainability as much as their customers do. Which is sort of natural. You know, very few brands, like Patagonia and a few others, care about sustainability more than their customers care about sustainability, because ultimately the brand exists to provide what customers want. So I think the increased demand we're seeing in sustainability, apart from in a few cases, is primarily because companies have become aware that it's what their consumers are demanding of them.
It's a good story. So it's a good story, certainly. Um, and people like telling that story because it makes them feel good and they think that they're going to make more money from it.
Yeah.
Um, there are the— there's all the other elements to it, you know, as well. The circularity, you know, transparency.
Yeah.
All of these, what unfortunately are considered buzzwords, but really shouldn't be because actually they do sort of mean— translate to actually something quite meaningful.
Yeah.
Um, All of these different things contribute to that, in inverted commas, sustainability goal.
Yeah.
And I think obviously US brought in CSR a number of years ago, and I think that's throughout the globe now. Most people are sort of adhering to most of those sorts of standards.
My main driver for this business is to increase the sustainability of the industry. I think it would also be a more fun and creative industry, but my main underlying rationale is the level of waste in the industry is completely unacceptable and we need to change that. And before this, I worked on electronic waste recycling, not on fashion. So, so I completely buy into the idea that sustainability needs to be driven through the industry. I think, I think it is also going to rely on customer demand continuing to grow for sustainable products. I think it's unrealistic to expect that brands are going to make that shift if consumers don't demand it of them. But I think they are demanding it of them. That's why they're doing it. And I think the other one, which is interesting and is kind of the angle we take, is that it's just better business. Yeah. I think if you can show that financially this makes more sense, then people will do it regardless. I think relying on brands' decisions from any ethical perspective is a dangerous strategy. I think brands rarely make a decision that's, you know, oh, this is better for the world, we'll do it. I think if that doesn't cost them anything, they'll do it. But I think the way you really drive change is if you make this change, you will make more money.
Yeah.
And that, you know, that's what businesses are about. And I think if you really want to change their behavior, you have to offer them a better business case for it, which can be because government introduces legislation or tax the hell out of waste. Or just because in the case of Unmade, we think we can offer you a technology which just is a better business case and it happens to be sustainable as well. Yeah, I think very few people would onboard our technology just to be more sustainable.
Yeah, well, it certainly is a nice, uh, filipino on top of it.
Yeah, yeah, definitely.
Oh, good stuff. Well, no, how— I just want to, um, thank you for chatting to us today. It's been really interesting, you know, talking putting the world to rights in terms of what you guys are doing. It's quite exciting. So yeah, hopefully we'll have another chat one day.
Yeah, cool. Thanks a lot. Everybody get up!
