How Technology Can Help to Empower the Future of On-Demand | DXM, Lectra | PI Apparel

Okay, I know it's September, and also I know I'm not as good a singer as Mariah Carey, but this is super important, so we just thought we would make this PSA for you.

You won't get a lot this Christmas. Everything has been delayed. If you want any Christmas presents, you need to order them today. You just may be out of luck. Waiting here for all your stuff, there's not much we can do. Pretty sure this Christmas we're screwed.

Oh yeah, here we go!

Shipping containers are stuck on the coast of California. And a Hong Kong port shutdown that ships 1 billion pounds a day. My kid wants a Snacking Grogu. Yeah, I know that's kind of weird, but it doesn't really matter. It won't get here until next year. Even with Amazon Prime, it might not get here on time. There's not much we can do. Pretty sure this Christmas Yes, we're screwed!

Gotta work on the falsetto part, don't I? Okay, here we go.

There was a huge COVID outbreak at the Chinese port Guangdong. So when you do online orders, you might notice something's wrong. Yesterday I ordered sneakers, gave my credit card, hit next. After they processed my payment, I got a red angry text. FedEx says this item's been delayed. I'm like, what? I already paid. So this is a PSA. Get your Christmas presents today.

So, so somebody sent that to me early September from a very large retailer. Friend of mine, and I immediately, no matter what you celebrate holiday-wise, and I celebrate several holidays through integrated marriage, I immediately said to my kids, "I need what you want now." Okay, and I ordered everything, and everything I ordered, I'd say by the end of September 20th, I got the last thing, okay, last week for them. In fact, I ordered a necklace for my daughter and it had charm on it. They only sent the charm. They didn't send the actual chain. So I got on the phone with them. I said, they're like, oh, the chain's on backorder. I'm like, but wouldn't you tell me you're going to just send me the charm? It doesn't work without the chain. So look, anybody experiencing problems in their supply chain? Hands up. Anybody company-wise?

Yeah?

OK. Yeah, full working. I think we're going to talk about on-demand, aren't we?

Yeah, exactly. And Matthew, DXM is really a startup. So you're working with a lot of startups. So what are you seeing right now in the startups world? What are the most valuable? What's happening?

Yeah, well, I have it on the screen, and it's purposeful you can't read them all except for maybe the one at the end. Anybody heard of Shein? It's pronounced she-in. Yeah, hands? 2. 1, 2, 3, 4, 5, 6. Damn, I said there was only gonna be 3. So they're valued right now, number 18, in the startup world. I think Carvana's over there, if I'm not mistaken, a few other companies in there. They're Epic Games, you could see up there in the middle or whatnot. So they did a little bit of revenue last year. I think they started about a year and a half ago. Chinese company. So for those of you who, again, a little more global. I apologize to anybody who's in the room who has a logo up. I already apologized to one of the brands in there. They did over $10 billion in revenue in a year. They're only going towards the Gen Z as far as their customer base, who I believe is about $130 billion of active disposable income, which includes their parents' wallet, by the way, but it's still active disposable income. And really what we're talking about when you talk about startups is, look, you see the fast fashion, and again, I won't say any names on the bottom, You see really ultra-fast fashion, that direct-to-consumer layer. And real-time fashion is really where SHEIN is trying to target. And I see a head or two nodding. Sounds like— have you actually used SHEIN? And? Yeah?

It's cheap, but I hate it.

OK.

It doesn't fit right, but it comes quickly, but it's—

Right. Super cheap, super fast, right? I'm not telling you that's the way to go because maybe not sustainable, right?

Yes, a question?

I probably bought 8 bathing suits this summer and they all rock.

Really?

Okay, so what she said is she bought 8 bathing suits this summer, they all rock, super fun or whatnot, but no one's ever heard of them, right? Just like no one ever heard of Reels until a year ago through Instagram or whatnot. So these companies, the point is, are just coming at us because they're serving a shifted consumer. Is what's happening, right? So again, this is real-time fashion. And how do you do that? Well, you can wait for shipping containers to come in from overseas, right, if you want, or vice versa, or airplanes. I think I got a quote the other day at $25,000 for a 40-foot container to come in from Asia. Usually costs about $1,800, so someone's making a lot of money on that stuff.

And they are coming in the US, but they are out of China?

Yes.

So have you noticed anything new or new business model coming out of the US US?

Yeah, so look, I think what there's been is continued talk about how do we develop more local, more on-demand manufacturing. I think cost usually always winds up being the bottom line discussion that we'll get to, but it is coming to the US. Anybody familiar with the Ariana Grande concert that they had actually on Epic in August? Epic Games? Yeah, you may have seen it. Anybody anybody familiar with this launch? This first launched on Epic Games. Balenciaga, right? $725 for a hoodie. I know my son asked me if he could buy it, and I said, sure, with your own money, no problem, but not with mine. I think they had a $1,295 jacket on there also. The demand was crazy. I was meeting with Epic a couple of weeks ago, and I just, I couldn't believe what they were basically telling us about the demand on this stuff. So it's here, it's now, it's digital, it's actual, it's virtual. So how do you then come about handling all of that?

So that's completely new business model and new— well, new for us. Some of us even don't know us about SHEIN already or these kind of things. Our kids may know more than us, that's for sure. But then behind this, on the reality of the manufacturing side, how is it possible? How can we do that, this real-time fashion? How can we make this happen? So what's the technology behind it that could make it possible today?

Yeah, well, I think what we need is we need a reality check, right? Everybody knows where we're sitting. Industrial Revolution 1.0 or less in the apparel industry. Yes, there are companies out there that are doing great things, right? One of them sitting in the room, a couple of them, a lot of them are actually downstairs trying to get us out of that. In fact, a lot of them downstairs are trying to get us to move forward in the space. So credit to every one of those organizations. But I would say that everybody's down there in their own booth, operating in their own lane, trying to get you to buy their own product, right? And is that how aerospace got to Industrial Revolution 4.0? Is that how the auto industry got to Industrial Revolution 4.0? Is that how the electronics industry got to the Industrial Revolution 3 and change up to 4.0, right? It's actually not how that worked, right? How it worked is it worked in that circle, right? And you have to bring together, and yeah, everybody can talk about IoT and cognitive computing and, right, IoT, it's just connecting everything. That's all it is. There's no big definition around IoT, right? You're just connecting everything, right? Like the circle states, it's pretty simple actually. And anybody wants to make it about complex stuff, that's okay, right? You do need to understand actual and virtual worlds, right? You do need to understand about advanced manufacturing. That's how the auto industry and aerospace industry, right, really have— they just kept working with the robotics companies, working, right, with the technology companies, how to integrate things together. And that's really where we need to go. And I'm not telling any of you anything you don't think or know, probably, right? Then why are we still stuck on the left side? That's the question. Anybody have a view on why we're still stuck on the left side? Ada Sunneson, do you have a view on why we're still stuck on the left side? I told you I was going to pick on you at some point, Ada.

You did tell me that you were going to pick on me. I think just as with everything in life, change is hard. People get stuck into their own routines. I think that can have a big impact. People can see the vision of where to go, but It's like, how do you get there?

Yeah. Anybody else have a point of view on that? Yeah.

I think it's hard to work around existing tools or processes that you have and the required investments that it takes. I think if you're starting from blank slate, you start with industry. We're not open to transitioning that way.

So that's a great tee-up for 4 slides from now. Thank you. Right? So essentially what she said was it's really hard to relearn, right? I'm going to paraphrase. 'cause I'll butcher exactly what you said, lost in translation, to relearn and change things essentially, right? Versus if you're starting new, you're just starting fresh and you can actually bring it from that fresh view to a new view. But it's also pretty hard to start fresh when it's like, what's DXM? I don't wanna come to this presentation. I don't really care, right, who they are. I don't know them, right? Well, I've spent my last 20 years working, or 20 years, 30 years in the industry, my last 10 years running supply chain at PVH and Walmart, But no one knows that when they put it out there on the thing, right? And I know a little bit about the supply chain problems we're having, which is why I bought all the Christmas and Hanukkah, Kwanzaa gifts earlier, right? Boxing Day gifts, right? That's why I bought them earlier, because I do believe that'll be a problem. And I'll do a PSA right now. Anybody wants an iPad, I'd go get it now from what I hear. So yeah. But I think one of the things that the auto industry has done, and some of the others, They've really become consumer-centric. You build your own car right now. And you could say Tesla changed the model with electric vehicles, right? And no car dealerships, but there's showrooms and you can go test drive. But even Mini Cooper, right? Some of the other brands. You just go online and buy. The pandemic, right? All of a sudden, why are there no menus at restaurants? Did that QR technology just start yesterday? Last time I checked in 22 years ago at NRF, that's what they were showcasing, right? Literally, I think I walked in and it was like, wow, this cool new thing. Except for we had to wait till a pandemic to get a QR code, right, at our restaurant. Well, I think the waiting is over. The talk has to be done.

So, and yeah, and the technology exists, is in action. I mean, it's connected and we are starting now a lot of websites using this technology going direct to consumer. But then What about the consumer? So you talk about technology being customer-centric. So what do the customers, the consumers want? What are you seeing? And while we have Gen Z coming in, changing also a little bit, shaking everything to make things new and different. So what do they want? What the consumers really want today?

Yeah. So look, I think the consumers want to be part of the process today. The next generation is not Generation Alpha. That is the order. Z goes to A. It's Generation E, Generation Everything. They want it sustainable. They want it fast. They want the corporate social responsibility to know that people are participating and are being treated well, paid well. Not a minimum wage, a living wage. And they want to participate actually in the process, whether it be just on a monogram, an embroidery. They're not looking to design the product themselves. They're buying that brand from that retailer because they feel good about that. But if you just look at— and look, this is the boring part. 3 slides of the boring part of the statistic— of little statistics here, right? So consumers are interested in personalization, right? There are consumers willing to pay more money for sustainable product, right? They're willing to pay more money for personalized and customized product. And that's real. That's not something that doesn't exist. And you say, well, 80% of my business. Yeah. What about the 5 to 10% of your business? Right. And you'd say, well, there's an 80/20 rule. Well, that 10% is going to be 30% in a few years. So if you don't address it now, you're going to miss. Right. And that's the point. We're not standing up here and telling you that 50% of your business should be done in customization or personalization. Right. Or on demand. No. What we're telling you is, is don't miss the boat today.

Right?

If not, you're going to completely miss it, and you're actually going to lose the consumer. Why? They're not brand loyal. 18 to 24-year-olds are not brand loyal, right? Because the next influencer or YouTuber who does something, they're following them. So I have 4 of them in my house, 18 to 26, and I know, okay? So I know they're loyal until they're not. That's very unlike us. That's very unlike us. Still go to the same places, like the same restaurants, do the same stuff. So, but take a look at that, right? And look, there is a quote on there. Again, it's public information, took it. Another statistic here, right? This is from Marketers 2019.

So it's been a couple years already and we've seen this trend increasing. I think that's That's a great percentage to see and explain how customization is becoming important in everyday life.

Yeah, that's to remain competitive, right? Think about that. $133 billion of disposable income. It's a lot of money to leave on the table, right? So again, I told you this was part of the boring part of the presentation, statistics. But Kedi?

Yeah, from 2019 again. And these— I'm really intrigued with those 60%. 60% of people wanted this personalization and being really mainstream. So, and that was within 2-5 years.

Yeah.

So what does it mean today with this? I mean, where do we stand with the personalization? Where are we between the technology that's available, the consumers, and what you showed on the numbers, what they really want?

Yeah. So another raise of hands. If you're not a brand or a retailer, but you're a consumer, who was more active online purchasing in the last 18 months than they were the previous 18 months? Anybody? OK. So why? Stores weren't open, right? That would be one reason. All of a sudden, I'm buying groceries, and I'm picking them up or having them delivered. I'd never done that before, right, if you will, all these services that I started to use. That weren't necessarily there. So look, it is happening. And yes, the word— it was accelerated by the pandemic, right? All that stuff. Yeah, it was. Is everybody just going to go back once the ships get all out of California, Savannah, and Miami to the way it was? Right. I think it may. Right. I think it may. I think the leaders will actually step up and move forward. But I think a lot of people will get back to that space. So catch it now, catch it while it's hot, right, if you will. Strike the iron. So we'll talk a little bit, I think, about how then this happens. And at the end, we'll do a little bit of PSA, right, for DXM. Just one slide. So at this point—

Can you talk about DXM? You've been mentioning DXM a couple times. So could you talk about the platform, how this is connecting the dots and making this, yes, real-time fashion, connecting consumers, technology altogether?

Sure. So the vision, right? It's to build a sustainable, localized platform with an enterprise scale of ecosystem, best-in-class partners for any creator to customize, personalize. Any creator to customize, personalize, co-create, test, and deliver products in 48 hours or less. Now I know there's one organization sitting in the room saying, yep, we can do that right now. We have that software, we have that equipment.

Right?

I know where they're sitting. You can do that, right? And the rest of you, you're like, not possible, right? Or many of you might be like, not possible. It actually is possible. We actually took orders last week, not big quantities. We made some woven shirts, right? Made them in an innovation center about a 15-minute walk from here in 2 days. And they were fit to the person in which they ordered them using artificial intelligence, machine learning, phone scanning technology. And it works. Can you do that at scale over a mass production? You can if you bring together brands, technology, retailers, manufacturers, advanced manufacturers, academia, and a startup ecosystem. Say, well, how do you do that? Just go talk to Mercedes-Benz. They did it. Go to Stuttgart. They did it. It works, right? The people— if anyone owns a Mercedes-Benz or knows someone who owns a Mercedes-Benz, OK, the system that powers the radio and the technology with that was a startup that they bought that came out of Silicon Valley. And they have a whole ecosystem there, and they bring startups through it every 3 months to see what else they can learn or whatnot. Just one example of one organization in a different industry. So I think what we're trying to tell you is if you get the technology, you plug it into the manufacturing, you enable it with the advanced manufacturing, right? Academia goes, right, and figures out that piece. You can actually get it right from start to finish in a very short period of time. We have built that technology. We have brought together that ecosystem. It took 3.5 years, about 3 years to bring the ecosystem together. When I get to the names who are on the ecosystem, you're gonna recognize all of them. Some of them are in the room. Some of them are your suppliers. So, and they've all basically signed up to be a part of it. So what DXM is, is, 5 co-founders, 6 investors, all multi-billion-dollar companies. And they basically have said, we want to help change the industry and then support from these advanced manufacturers and other organizations who also want to help shift the industry. And we'll go through that a little bit, but how does it work? So here's the PSA for Gerber Electra, but Katie's going to kind of bring you through that.

So how does it work? Yes, you said the platform and connected all this environment together. And here, this is the full process. With also the Gerber solutions supporting this DXM platform. So this is also what we have at the Innovation Center, Gerber Innovation Center in New York. Just a question, how many of you did come to the Innovation Center already? Hey, we have quite some people. Okay, well, for the others, just, we are just a few blocks away, so you can experience and see also what the DXM platform is and how it integrates and connects the dots. Of all the ecosystem from the consumer, like from a website. It will be able to take the measurements, body measurements, is just with different techniques. So all the solutions that you see here are not all Gerber solutions. Gerber integrates with some different partners like DXM, but also with some digital printing technology for digital printing for body measurements. We have couple ones for sewing and so on. So our objective is really to create this workflow, this end one-to-one workflow and show what's possible from the consumers when he takes the order right through the production, the manufacturing at the end, and to produce on demand. So it can be mass customization, it can be some small volumes up until 2-1. And this shows how this is scalable. And you mentioned it, Mathieu, with the orders last week. We have some more coming in, a couple shirts completely made to measure. Some are made in a few hours, some are made in a few days, 2, 3 days, depending on the complexity, customization, or made-to-measure. And the way the workflow articulates all starts with some patterns. So you need some pattern at the beginning that you can see in 2D, in 3D. 3D is more and more a very important part, I would say, of the process, not only to make sure you get the best fit, And it's sustainable. You don't have to cut some samples, physical garments. You can be virtual, so it's good for the environment. It's quicker, it's cheaper, but it's also super helpful, especially as you are made-to-measure, to put it on a website. So you can see any color, any print. You can add any embroidery, any personalize, for example, your first name on it. You can— you name it. And adding the 3D make it possible just to make everything, showing everything very quickly, instant— immediately. So right through this pattern, then it goes through some software just to create the markers to automate it, connect with the body, Bodygram, body measurements, anything that's needed if you want to make-to-measure. It's not mandatory to make-to-measure. You can have your regular sizes. That works too. And from this, it can go to a printer. We are printer agnostic, but at Innovation Center, you can see the Kornit Presto being able to print on the fly any kind of color or prints that you want to have, as small as 1 unit. So it's completely scalable and then automatically cuts. And what's revolutionary with that is that usually you have to prepare a cut file. So you prepare your pattern, your cut file, and then you're able to produce. With this technology, you don't need a cut file. You just print the pattern directly, as you can see here on the image. You have some lines that are recognized by the systems on the fly and cut any pattern. So it can be small volumes, as small as one unit. It will cut what has been printed. And then the sewing and final assembly. And that can go through as just 1 hour up to a couple of days depending on when you want to print. And you had this experience yesterday, was the last time?

Yes. And we haven't just done it here, right? The Innovation Center is an innovation center, right? It's not a production facility. And those of you who have been there would know that at this point. There's a microfactory within that that can do to, you know, kind of test small POC type stuff, if you will. So how do you connect this into a larger scale, whether it be a 3D knitting machine, a 3D printer for hardware, whether it be a mass manufacturer that has set up a modular? Our technology allows you to go from a brand or a business or a retailer's website to that manufacturer digitally in less than a minute anywhere in the world. That's what it allows you to do. You have to API and connect into the right softwares, but that's what we do. And you can customize or just personalize. So again, we don't own inventory or any of that stuff. It could be a SaaS model, right? Or it could be a MAS model, manufacturing as a service, right? One way or the other. I didn't coin MAS, but someone told me last night I should. So I might register it later today and see if I can actually do that and then sell it to Amazon or something. Just kidding. So look, but aren't there roadblocks? You're sitting out here and you're like, yep, dream, great, okay. 'Cause look, we showed you before, Industrial Revolution 1, right? High volume, MOQs, long lead times, right? Let's go to the, let's chase to the, Africa's the next frontier, right? Let's get into Kenya and Ethiopia and everywhere. Nigeria's next, there's plenty of cotton, right, et cetera. Just keep going into those spaces, if you will. A lot of waste, right? We have to, as this industry, we have to come together to make and be more sustainable for the world, not just for us as a brand or a retailer individually, right? The consumers are demanding it that are coming up as your consumers shortly, if you will. And you have to move onto a percentage of your business. Only make what you sell, right? So we have a customer based in the UK. They only are on demand. They will only make what is sold. It's their value proposition. They will never make inventory, right? I'm not sure if the business model is going to work, to be honest with you. I don't know, right? I love the business model from a fundamental standpoint. I don't know whether or not it works from a financial standpoint. I don't know if they know, actually, but I like the idea of it. And I'm not saying— that's what I said before, it's not what you should do. I think it should be a percentage of it. And I think that digital connection is what really is important. So again, why is it so hard, right, to move? It's— I think it's 3 things, right? I'll share my 3. I'm gonna let Katty share hers. Mindset, right? Willing, able. Are you willing to take a chance at this? Are you able to actually do this? And I think that's just the simple things. Ada kind of touched on it before, how hard that change is, right? And it's really hard, 'cause now all of a sudden I'm in a big company and I need to go talk to my technology group or my CIO or my IT group, and they have 105 projects that are gonna take 3 years, and then they're gonna implement SAP, and then they're gonna put Oracle on, and I get all that, okay? You guys, I see the rolling eyes. I worked at Walmart and PVH. I get it, right? I've been on the other side of that business. I understand how hard that stuff is. And that's not berating Walmart or PVH. It's just hard to do. There's a lot of stuff going on with these companies, at all of them, right? Katie, what's your thoughts on that?

I think that the mindset— you've got the right word with that. Because when you move from a mass production journey into an on-demand— and by the way, I think that the two can coexist and will have to coexist in the future. Mass production will continue with some basics, with some garments, but on-demand is really the way to go. And as you said, really, we can understand that the consumers, this is what they want. And I have 3 kids at home. When they see something on YouTube, on TikTok, or on Snapchat, this is what they want today because they think that at school the next day everybody will have it. So they need to get it immediately. And that's all the kids. So on-demand And this real fashion is really happening, but coexisting with mass production. And speaking of mindset and what we see on our consumers is, you talked about the profitability model. That's the first question. Okay, but what's the cost? How much is it going to cost me to produce that? Yeah, that rings a bell to some of you. Yep, I see a lot of heads nodding. But the thing is, with on-demand, you cannot just apply the same total cost of ownerships or the same metrics. Because you don't produce, so you don't have your cost per garment on the mass production. Then you add the shipping cost, then you add your retail cost, then you have to add your discounts, and eventually will be thrown away. By the way, on sustainability, especially for fashion, one truck of worth of garment is thrown away every second worldwide. One truck is landfilled Every second of garments because of the unsold, because of the returns, because of the mass production. And that has a cost which is usually not taken into account. So how can you define the profitability, total cost of ownership? How can we assess?

Yeah, I think the business model has to change, right? The P&Ls have to change, right? I've sat in those boardrooms, right? I've gone through those P&Ls. I've been responsible for some of those P&Ls. I understand. Total cost of ownership has to be looked at versus IMU, MMU, right? You need to understand the lifecycle of that garment, not just from a sustainability standpoint, but also from a cost standpoint. What does it cost if it sits on that shelf? What if it is the wrong color, the right color? What if I don't have enough of it, right, and I'm out of stock? Do they go buy it somewhere else? If it's a white shirt, they may. Right? If it's a brand they care about, right, they may not. They might wait for it. But to Keddie's point, very few Gen Zs and young millennials are waiting for anything these days. They just move on to next, if you will. It's a shift in that mindset to total cost of ownership. It needs to be done. It's difficult to do, by the way. Not easy to do. I failed at getting it done, I could tell you that, right? So with that, How do we see the future? Well, these are real statistics, right? And then we'll have some time for Q&A after, right? So these are real examples from real companies about reductions in e-commerce returns, right? Why? Just using either fit recommendation, fit preference, 3D technology, right? Things like that. Those are big numbers, right? They're all double digits, but all of them are above 20% too. Good. All right, so talked about a lot of this stuff. It's the last slide we have. Um, I'd like you to take a look at the value proposition. So there's seamless technology platform, right? And some of the people actually demonstrating here, uh, actually are part of that technology platform. Uh, Unit of One or small batch tests in React, that's a sustainable solution, right? In and itself, it's sustainable solution. Again, it's not everything. It's a piece of, right? It addresses a consumer base. Co-founding members. It's on our website. So you see Carhartt. Anyone not know Carhartt? They're a brand. They've been around about 140 years. So Michigan-based company. Brand X, Busana, Shahi, and MAS. Probably 4 of the top manufacturers in the world in their categories. I would say woven shirts, activewear, woven bottoms. I would say if there's a brand here, I don't think there's a brand here who probably doesn't make product with them. I've looked at a lot of the badges that were going around. I'd say most of the brands certainly would work here with them. So, and again, there's a few of you in the room that I saw actually that absolutely work with them for sure. They're multi-billion dollar companies, they're leaders in their space. Right? Why would they invest in this startup? They believe that the industry needs to shift. They believe a piece of the business they should be involved in offering on-demand, local, Europe for Europe, Asia for Asia. I know Asia's really big, so it'd be India for India and certain parts of Asia for certain parts of Asia, and North America for North America, right? Why would a brand be a part of that? Well, that brand actually has factories in Tennessee and Kentucky. And makes product in the United States of America still, and has for a really long time. And what they want to do is they see a way to perhaps help this with demand, right, as well as help their current manufacturing facilities. And then take a look at the right. So Lecter Gerber, you see two different names. We'll start with them since we're on stage together. Before Lecter bought Gerber, they were sitting at the table together. They coexisted in the conversation about changing the industry together. There was never any major debates. There was a good conversation is what there were, right? So credit to both of them. Is it easier now that they're together? For me it is. Yes, it's a lot easier, right? That's for sure. You see Shima, they're downstairs, they're in the room. Thank you. They've been a great partner also. Of DXM. They also are trying to help shift the industry with their software, with their hardware, right? And they're doing a great job on their own, right? 3D knitting products in an hour or less in some cases, right? And if you haven't checked them out, check them out, right? You should. They've been great supporters. We believe that is some of the advanced technology, right, like Lectra and Gerbers, that helps shift in the advanced manufacturing space. That helps enable you do it, right? It does. And by the way, you also then get to pay people in the United States of America a living wage and get to train them on equipment like you see, we'll see at the Innovation Center, like you can see, they get to learn and upskill, right? So there's something there on the workforce piece too. So I talked a little bit about Plug and, our ecosystem and startups, that's a company called Plug and Play. Avery Dennison, is there somebody at the table? You've already heard a little bit about Kornit. I was just at their LA Fashion Week last week, if anyone was there. That was phenomenal. Do I think the technology is completely there that you can digitally print every fabric? No, I don't, right? But it's a lot further than it was 3 years ago. And all that means is it's going to be a lot further 2 years from now, right?

Yeah, it's improving all the time. Last week they showed for the first time how to print white on black. So that's improving all the time and all kinds of fabric are not there yet. But we can see at the Innovation Center that we can print and cut on more and more fabrics. More and more colors, more and more styles, and the quality and durability is becoming super impressive.

Yeah. And then you see NC State is the last one I'll bring up, university. We have between 5 and 11 students a semester. We make a donation and they are our worker bees. They work on real projects and deliver at the end of each semester stuff we're working for. So not only do they get a learning, we get something out of it and it really works terrific for us. So again, that's who we are. We got about 3 and a half minutes. We'd love to open it up for questions if you guys have any. Great.

There is a question there.

[FOREIGN LANGUAGE] So I was on with a former Assistant Secretary of Commerce yesterday. I've met with the DOD. In fact, we were in a meeting in Boston a few weeks ago, and the DLA, which supplies all the military their uniforms, about $8 billion worth of uniforms and equipment, and the DOD was there, Division of. Look, it's difficult, and I'd say I've made a lot of progress in Michigan with the state and the city, but at the federal level, it's just difficult, I would say, at this point, and you need the right people and the right organizations to come to the table together to go do this, but look, government has to be part of this because I think there's a fund— they're there on PPE. They'll subsidize on PPE, right? But isn't— aren't jobs, really good jobs, something, right? We're putting all this money and sending out checks and all this stuff, right? Maybe things like this could be helpful, but look, it's difficult, but it's a great question. Anybody else? Yeah.

How much pushback do you have on the adoption of this because of the seasonality of sales and the inability to level load your factory?

Yeah, so we're not gonna level load anything. We're just gonna make, so there is an inventory component on the raw material side of things, to your point. Yeah, and that's a—

You don't have people buying it as the speed you make it. You are generating— No.

We only make it if an order comes in.

In my experience, that had to shape the whole good market.

Yeah.

Everything was about level loading.

Yeah.

Maybe what categories we operate in.

Yeah. So look, I think your question— I'm going to break through different— so this is a big idea, right? And we've been at it 3 and a half years. This got incubated with all of PBH's support while I was at PBH. And we decided in order to actually really make this work, it actually had to come outside of PBH, right? And other people had to be involved, right? That's really what happened. It's probably how all those people actually got involved, because I was at PBH at the time, right? So look, I think that you asked a great question. I'd say think big, start small, act fast. Take one category, couple colors, and just go with that.

Custom cycling wear. So that's all—

custom cycling wear.

Yeah.

So but that has seasonality, or you're global, or you're going into wrestling because it's in the winter. Yep.

And that's the kind of— and I believe that that can work because how many different cycling shorts do you really have, or tops? And I don't— maybe your business— and look, I'm a cycler, so I understand it. And we've talked to a few of those companies. And I think that they're trying to solve these solutions right now, some of them.

Oh, for sure.

Yeah.

It still extends to the factories that they have and to their sales team.

Yep, yep. It does, it does. Last question. I think we're just about done. Anybody else? Oh, one more at the end. Take the last one.

How do you make the economics of order of one work?

Yeah, so look, the product costs more money. You're going to pay more money for the product, right? So if this shirt's $98, it might be $150. And the question is, will you pay more for something that's yours, that you've been part of, that you get quickly, that you feel a personal touch on? It's not for everybody. That's why I said it's in that 5% to 15% range. But when you get into team sports— you were talking about the cycling— You also don't know what size. You're sending all this stuff over to teams to figure out if it's right or it's wrong versus right. So there's a huge expense in that space. Look, I understand the space just from the swim side, just from my previous life. But anyway, look.

Yeah, maybe one comment also on the economics of it. I think there are two aspects too. One aspect is also the technology to just streamline the whole process and avoid all the different costs and things that add up pretty quickly that you just remove. And then the second part of it is when you are direct-to-consumer, like with DXM and all this made-to-measure that you just produce for one person, when the person already buy upfront and then you produce. So you have no returns, you have no fit issues, you have no colors challenges. So all these costs just disappear from this model, and that's become some benefits. So there are for sure some additional costs because you— well, we didn't— maybe for another topic, talk about the nearshoring. So you avoid the shipping. So it's a bit more expensive, yes, to produce in the US. But at the end of the day, with all the savings, we could see like in the example earlier, then it's profitable.

And not easy. I'm not going— I want to be clear. I want to clarify. We're not direct-to-consumer. We are business-to-business, brand-retailer. Our ask is put Powered by DXM on the bottom of your website, right? We want to— we'll ship direct to the consumer for your brand or your business, right, or your team or whatnot. We're not direct-to-consumer. We're not a brand, right? We are a technology-driven, on-demand manufacturing platform that's for anybody. So, no, no, no, no. So I heard what you said, I wanted to clarify. No, it's not DTC. Yeah. So anyway, look, with that, I wanna thank—

It's B2B2C.

B2B2C, yes, thank you. So listen, thank you all for the time, we appreciate it. Good question.

Thanks very much.