fashion industry is at a decisive point | My Assignment Tutor

P a g e | 1TECHNOLOGY AND ENTREPRENEURSHIP ASSESSMENT – IIBY SAYANTANI BOSE (77212094), SWITZEL TACITA LUIS (77212812), NICHOLAS MUDALIAR (77211833)AND CHIRAG ISRANI (77212833)SUSTAINABLE FASHION AND TECHNOLOGY START UPP a g e | 2Dear readers,The fashion industry is at a decisivepoint in its life. In the past fewyears, comments have emergedrequesting more sustainableproduction. Following the tragedy ofthe 2013 Rana Plaza collapse inBangladesh where 1134 peoplewere killed, various issues like thepoor operating conditions ingarment industries, lead to thecreation of the #FashionRevolutionmovement. This inspired brands tobe clearer regarding theirproduction chain by utilizing thehashtag #WhoMadeMyClothes.Therefore, we are very happy tounveil that our start-up will also besustainable in consideration ofenvironmental impact and will alsouse the Artificial Intelligence (AI) tokeep the designs trendy & fresh.It is sure that consumers areincrementally value-driven whilstpurchasing goods like shoes. Asper the Pulse of The FashionIndustry’s 2019 report, 38% ofconsumers found switching to afavored brand depend on its socialor environmental practices. Thus,our mission is to give sustainableproducts which will be the solutionfor those consumers. We hope youenjoy our Sustainable Fashion andTechnology Start-up 2020 BusinessReport!We wish you a Pleasant reading!Best Wishes,The Subgroup 6 Team*Heuritech, 2020. FASHIONSUSTAINABILITY REPORT. [Online]Available at:http://www.heuritech.com/sustainabilityreport/[Accessed 1 September 2020].Highlights…Why we have chosen Hemp as ourprimary material rather than juststicking to conventional cotton.We have developed the AI torecognize the characteristic of theapparel in photos and search forpatterns.With the pollution caused due to thefashion industry, our business willsoon become a need rather than anoption.Fashion Industry is the 3rd Largestrevenue generating industry since2015.CONTENTSHighlights…………………………3At a Glance…………………………4Our Material analysis……………5Our AI and Technologyanalysis…………………………….6Viability (and Models) ……………9Costing……………………………18Our Business modelanalysis…………………………19Appendix (PeerEvaluation)…………………..…21At a Glance….OUR VISION AND MISSIONThe huge amount of socialmedia influencers around theglobe are constantlyinfluencing people with theirideas, and today’s sad truth isthat people are drowning intosocial media.OUR VENTURE BRIEFOur Start-up business will be using AI to track the early signs of afashion trend and provide the said designs to our clients. We willalso be providing them with Hemp to create the given designssustainably.However, we have got a sad news for all rebels anticipating rollinga joint from a shoe!So basically, we will be using Hemp as a material which is in realthe ‘sober cousin’ of marijuana, to design shoes using AI. It is theindustrial hemp which comprises just a little amount of thepsychoactive substances of cannabis. So, the only high you will getfrom this material is the moral high ground you will stand onknowing you are using a sustainable fabric!P a g e | 5Our Material Analysis…WHAT IS HEMP?Hemp also known as IndustrialHemp, the form in which we wouldbe using it is one of the eco-friendlycrops. Reasons as to why it isclassified as an eco-friendly crop isbecause of its growth in theenvironment. It does not requireany pesticides yet it capable ofrenewing the soil with each cycle ofgrowth. Hemp in general requiresminimal water to reach its full-lengthgrowth.Industrial Hemp producingcountries have a regular checkdone by the government thatlegislates a limit over the THC forproducts that contain Hemp.BENEFITS OF HEMP*Hodkel, B., 2020. What is Hemp Fabric: Properties,How its Made and Where. [Online]Available at: http://sewport.com/fabricsdirectory/hemp-fabric[Accessed 12 September 2020].Moving on to the benefits of thefibre:Now we will discuss why wechose Hemp over Cotton:P a g e | 6PROCESS OF CONVERSIONOur AI and Technology analysis….Before getting down to explaining what our services are,we need to brush through a concept called ArtificialIntelligence (AI).AI is the technology that enables the computer or systemto think and act more like a human. This is possible bycreating an algorithm that makes the system collect datafrom its various surroundings and create responsesbased on what it has already learnt. AI integratedsystems are developing at an increasingly high rate asthey are learning from their mistakes and change theirapproach for the next time.P a g e | 7The answer to that is not very straight forward but let us try making itsimple.AI uses cognitive reasoning to solve problems like pattern recognition,image recognition and forecasting. There are 3 major learning modelsthrough which AI can learn this cognitive reasoning and improve itself tobetter fulfil the requirements namely:A. Reinforcement LearningB. Supervised LearningC. Unsupervised LearningReinforcement learning develops the AI’s knowledge through trial and errorinteractions with its surrounding. Supervised Learning assumes that there will be ateacher/supervisor that will train the AI into what is required. The last model and theone we are using is Unsupervised Learning, which identifies patterns heuristically.This broadens the scope and approachof the AI thus allowing it to go beyondthat of human capabilities.To facilitate this learning, there are various tools and services available in the world.Google’s Auto ML Vision or Amazon’s Recognition are 2 of the biggest and mostwidely used API’s (Application Programming Interface).APIs are like frameworks that people can use to develop their AI algorithms and makeit more advanced. These APIs (Auto ML Vision and Amazon Recognition) train the AIas per the user’s requirement for their custom AI model for a fee. This not onlyreduces the time required to develop the AI but also makes it more efficient andreliable.The benefits of using APIs are:Technology development:To begin with, the process ofdevelopment begins with firstdeveloping the AI algorithm. Thealgorithm however needs to be savedon an Application server (Anapplication server is a space on whichthe AI will run its calculations andperform its functions). These serversare going to be purchased by us as it isgoing to be in constant use. Once thisis set up, the developers will create thealgorithm for the AI and set up variousparameters and conditions to triggerthe responses. For example, in theimage that follows the AI will have torecognize the various characteristicsand log it as data for furtherprocessing.The AI technology needs do recognizethe image with respect to its attributesand then cross reference it with theP a g e | 9number of times it has come up in anypost or hashtag. By doing so it cantrack the sudden surge in hits assimilar to that of when a trend isemerging and after learning this fromvarious re-runs it will soon be able totrack the early signs of an emergingtrend. Thus, making it easier to make aforecast of the upcoming trends anddesigns.The next phase is to deliver this dataas useful information to our clients.This we will be doing by using cloudspace. Through Amazon Web Servicewe will be hiring a cloud service andallow temporary access to our serversso that they use any information theyrequire. The link will direct them to adashboard with a well-designed webpage which they can easily navigate toretrieve the information they require.The last step of AI is to merge theforecasted design trends with thesustainable material Hemp to create aproduct which will not only be up todate in style but also beenvironmentally friendly.Brands can then use these designsand material as a base or framework,add their own signature to it and sell it into the market as new and sustainable.Development of the AI and all aspects surrounding this including web page designwith regards to User Interface will take roughly 18 months. However, with theunsupervised learning model and constant development and maintenance over timethe margin of error will become almost negligible.Viability (and Models) …Fashion is a huge industry, thus as a start-up we are mainly focusing on shoes sector.In total this sector is projected to generate a revenue of US $125,752 million in 2020.The annual growth rate (CAGR for 2020-2024) for shoe sector is 7.1%, which willresult in increasing the market volume to US $165,452 million by 2024. Userpenetration of the shoe sector is 22.6% in 2020 and is expected to hit 34.3% in 2024.By 2024 the users in this sector will mount to 2650.8 million in shoes. Hence, we cansee that the customer base of this sector is huge and investing or penetrating in thesegment can prove to be fruitful. In our business model, hemp is of utmostimportance, as that is the prime sustainable material that we shall be using to produceshoes. As per the current market leather is forecasted to produce a CAGR of 6.2% by2025.P a g e | 10Asia-Pacific being the fastest growingmarket. Leather goods are highlybecoming popular due to its inherentqualities like fireproof, dustproof, crackproof and durability, which in turn isgiving rise in demand of trendy bags,premium leather wallets, and leathershoes. Europe based companies likeLouis Vuitton, Gucci, Gianni Versaceare the major players in the leatherproduct market. But, when looked at, itis found the earth and its creaturesmust pay a huge cost for using theseleather goods. Raising animals forleather, require a huge amounts offossil fuels, water, and pasturelandwhich causes a lot of pollution. As vastareas for pastureland requires cuttingof trees, it further leads to deforestationeliminating earth’s tree canopy anddriving climate change. According tothe U.S. Environmental ProtectionAgency (EPA) livestock pollution is thegreatest threat to our waterways.Hence, our business model aims toeliminate this harm caused to thenature by bringing into existencesustainable fashion items made ofhemp, which is a natural andsustainable material. Hemp or insimple term weed grows easily withoutany herbicide, pesticides, or fungicides.It dries quickly and does not rot. Henceno processing for prevention of rottingis needed. The way it is grown andproduced is mostly organic. Hemp canbe an ideal material for footwearbecause being organic it is alsohypoallergenic and doesn’t irritate skin,also will prevent the feet of the userfrom sweating because of its thermoregulating property.Its natural anti-bacterial propertiesprevent it from hanging on to odorsunlike many synthetic materials.These fibers are extremely strong,which will contribute towards thedurability of the footwear. There won’tbe any pollution or soil degradationcaused because of hemp as it is anatural fiber and will decomposeeventually and will leave very smallcarbon footprint compared to syntheticvegan leather. Also, hemp plantationswill contribute towards reducing globalwarming as it is after all a plant. Thecannabis grows very fast and yieldsthree to four times annually. Theproduction of hemp is veryinexpensive, and governments of manycountries are legalizing hemp forindustrial use. Soon there will be aneconomic boom as the business ofhemp is growing rapidly for industrialpurposes, which will not only result ingreat sustainability, but a huge costeffective economy will come intoexistence.*Hodkel, B., 2020. What is Hemp Fabric: Properties,How its Made and Where. [Online]Available at: http://sewport.com/fabricsdirectory/hemp-fabric[Accessed 12 September 2020].Policies Affecting the Market forIndustrial HempHemp (Cannabis sativa) has remaineda federally regulated Schedule I drugunder the Controlled Substance Act,which is regulated by the DrugEnforcement Agency (DEA). Recentlycreation of Section 7606 of theAgricultural Act of 2014 (the “FarmBill”) made a clear distinction betweenthe use of hemp (Cannabis sativa) formedical, recreational, and industrialpurposes, which resulted in allowing, alegal path for growing hemp forindustrial purposes with respect tocertain regulations. In 2016, a jointstatement explaining & detailing theguidelines for growing industrial hempwas issued as a part of statesanctioned research program by theDEA, U.S. Department of Agriculture,and the Food and Drug Administration(FDA).Currently, farmers and institutions ofhigher education are participating invarious program legalizing productionof hemp to increase the production ofcannabis eventually with time, so thatthey could be used more for industrialpurposes.So, as we have already found out themarket of the shoe sector is huge andprojected to increase even more in the upcoming years with a good number of userpenetration, therefore a great opportunity can be perceived with this regard.Astoundingly, Instagram fashion sector these days are trending more with sustainablefashion hashtags, that is encouraging the transition towards more sustainable brandpractices. It suggests that the influencers do care about and are leaning towardssustainable fashion, and it is a good sign to bring in a fashion revolution to serve thehuge market base that’s already projected.P a g e | 12 AHP enables managers to make potentially more effective decisions by structuring and evaluating the relative attractiveness of competing optionsfor any type of managerial decision.By doing the AHP calculation for selecting the best criterion for sustainable materials amongst durability, polluting/Harmful, chemical free, we havearrived at the following result:With respect to the percentage of the bestcriterion, we have done further AHP forselecting the best product sustainableproduct namely Hemp, Animal Leather,Synthetic Material & Vegan Leather.And here are the following results that wehave got:P a g e | 15Our productor service has gone through all the steps of building the house of quality, and above is the house of quality of our productand services that we have came up with all.QFD can be deployed across the organization in response to customer requirement at various stages from NPD to production, whichinvolve designing characteristics, specifying components, process of production and quality planning.P a g e | 16Patent is a type of intellectual that gives a right to the owner ofthe product an exclusive right to the owner from preventinghis/her invention from usage by others.Rights conferred by Patents are:• Right to prevent others from making, using, offering forsale, selling or importing infringing products in thecountry where the patent was grantedException: non-commercial purposes (private use,academic research)• Right to assign, sell or license these rightsThe role of a patent system includes the following:• Protection – up to 20 years• Encourages technological innovation• Promotes competition and investment• Provides information on the latest technicaldevelopments• Promotes technology transferFor a product to be Patented it should be:New to the world (i.e. not available to the public anywhere inthe world)Inventive (i.e. not an “obvious” solution), andUseful – susceptible of industrial application.Our business idea or product cannot be patented, as we arenot inventing anything that does not exist. We areincorporating external innovation on already availabletechnology that is Artificial Intelligence along with a naturallygrowing substance called Hemp for preparing our product orservice by merging these two.Hence, we cannot patent our service or product.Hemp has a lot of advantages due to which it is classified asan eco-friendly form of fabric. Some of the reasons arementioned below:On per acre basis, hemp produces more fibre than that oftrees and can be renewed for almost two to three times a year.Compared to other normal trees, Industrial Hemp plantsabsorb more carbon dioxide.Along with its advantage of not using pesticides, the plant issaid to have return 60-70% of the nutrients it takes duringgrowth back into the soil.The entire plant is used and does not go into waste. Startingwith the seeds, they have a lot of proteins and are used tomake oils for cooking and be used for paints. The leaves canbe used to replenish the soil as well as can be eaten andmade into juices. The outer part of the stem is used to maketextiles, rope while the inner core is used for paper, animalbedding.Hemp alone gives the qualities of cotton, corn & soy.Hemp tends to prevent soil erosions with the help of its strongroots that penetrate as deep as nine feet deep into the soilwhich holds the soil together.Another amazing fact that hemp has is that it is used as aplant that absorbs toxic metals. It was famously used duringthe Chernobyl Nuclear disaster and helped remove radioactivestrontium and cesiumIf you did not know, then hemp also helps provide a shelter forwildlife like birds with its growth reaching up to a height ofthree feet. On the other hand, the flowers of hemp are a goodsource of pollen for the bees.Hemp can also help fight against deforestation.We know that hemp take four months to grow while trees takeyears to mature. Hence, hemp could replace trees as a sourcethat provides raw material for the manufacture of paper. Hempdoes have the potential to save our planet that is gettingdestroyed.Converting skin into leather requires huge amounts of energyand usage of dangerous chemicals, like formaldehyde, mineralsalts, coal-tar derivatives, and dyes, oils and sometimescyanide.Effluents from tanneries contain huge amounts of pollutants,like acids, sludge, sulfide etc. The process of tanning protectsthe leather from rotting.Many people who stays in proximity of the tanneries die ofcancer, that is caused by the exposure to toxic chemicals likearsenic, sulfide and many other cancer-causing chemicalsused for processing and dyeing the leather.P a g e | 18Costing…COSTING SHEET (For a financial year): PARTICULARSAMOUNTTOTALMaterial cost: HempSourcing (Cost per metre –$11.70) (900 meters)Freight (125g = 135 cm 100%hemp)Custom Duties (3.5% of $10,500)VAT (20% on subtotal of$10,500+$280+$367.5)$ 10,500$ 280$ 367.5$ 2,229.5$ 13,377AI costAI – Development:1. Salaries (2 Developers& 1 Web PageDesigner):2. Server: maintenanceand purchase3. AWS: Cloud space4. API$ 42,000$ 1,100$ 700$ 500$ 44,300Branding & Selling cost$ 7,000$ 7,000Marketing cost$ 3,920$ 3,920Premises (Rent & Utilities)$ 50,000$ 50,000Total Cost$ 118,597Average profit for shoe line(20% shared and 20%reinvested)40%$ 79,064Potential revenue (Based onother company data &Industry analysis)$125,752USD of its$10,000USD goal$ 197,661 START-UP COST Cost of Incorporationand Registration fees$ 75Contract Preparationand Review$ 140License (Notification toprocess personal data)$ 50IT and Equipment$ 1,000Travel cost$ 1,000AI Initial Development$ 50,000Hemp Licensing$ 800Total Start-up Cost$ 52,990 PRICING FOR SHOES Suggested RetailPrice: (PRICING)RangeTop Designer shoesb/w $300-$600Mid-Range shoesb/w $75-$200Shoe store like Paylessb/w $20-$50 perpair P a g e | 19Our Business Model & Critique…The question you might be thinking about right now is “Is it really this simple?” “Andwhy will any brand use your services?”.Well to answer this lets just go over all that we have learnt. First, welearnt what Hemp is along with its benefits and why it is a better optionover other materials. We explained about our sources and prices,along with the licenses and legal restrictions surrounding Hemp.We then moved on to the see the role of AI in the business. We sawhow it is developed and how it will recognize patterns and images andover time once perfected the early signs of a trend. It will then convertthis data into a forecast. This forecastis based on the upcoming designwhich have the potential to become anew trend. Various such forecasts canbe made based on the requirements ofthe client and then provided to them fora fee mentioned above. This fee isgoing to be our basic revenue and oneof our two sources of income.The second source of income will flowfrom the Hemp material that we willprovide the clients along with thedesigns that we give them. Since wealready have all the required licensesand know-how of Hemp as a fibre wecan provide them the best designsalong with the best quality Hempmaterial at the best possible cost.Thus, our model may look basic,however the work that goes behind thescenes has to be done smoothly tomake it possible.The answer to thesecond question lies inour Viability Analysis &Sustainability report. Itcan be observed thatthe benefits that Hempcan provide along withthe ability to stay aheadof the fast-changingfashion industry is exactly what brandsP a g e | 20need to stay ahead of their competition.Big brands are now being targeted by negative comments due to their impact on the environment and less then friendly processingmethods. Our business can change this with the help of the fresh designs we provide them, the Hemp material which we are fullyequipped to provide combined with their already established manufacturing set up and brand name.Thus, now more than ever, our services of AI and Hemp are of great value not only from a business perspective, but from theenvironmental perspective as well.The start may be a little slow, but once the importance of our business is recognized as we grow, the demand for our services willgrow as well. The AI will also get more efficient with the constant development and learning and as volumes increase our overallcosts will also reduce.APPENDIX (PEER EVALUATION):Compulsory Peer evaluation form to be submitted by every groupGroup Name/ Project Sustainable Fashion and Technology StartupWrite the name of each of your group members in a separate column. For each person, indicate the extent to which your group agrees with thestatement on the left, using a scale of 1-4 (1=strongly disagree; 2=disagree; 3=agree; 4=strongly agree). Total the numbers in each column. Evaluation CriterionGroup member:Sayantani BoseGroup member:Switzel LuisGroup member:Chirag IsraniGroup member:Nicholas MudaliarAttends group meetingsregularly and arrives ontime.4432Contributes meaningfullyto group discussions.2334 Completes groupassignments on time.4333Prepares work in aquality manner.3333Demonstrates acooperative andsupportive attitude.3233Contributes significantlyto the success of theproject.3333Total19181818

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