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Itochu rides digital wave with online bespoke shirts in Hong Kong

Japanese trading house ties up with Shenzhen startups to showcase new business

Digital measurements can be shared directly with clothes manufacturers for increased efficiency. (Photo courtesy of Itochu)

TOKYO -- Japanese trading house Itochu launched an online bespoke clothing brand last month in Hong Kong with Chinese startup Shenzhen Tozi Technolgy in an effort to digitize its supply chain amid the COVID-19 pandemic.

Itochu's new bespoke service Inishirt uses Tozi's size-measuring technology. Customers can buy a tailored shirt without visiting a store just by sending in two smartphone photos and choosing a design. A business shirt goes for 690 Hong Kong dollars ($89).

The product of research at Hong Kong Polytechnic University, Tozi uses artificial intelligence to create 3D digital avatars of bodies from the two photos. It can measure any part of the body -- including the neck and hips -- with 98% accuracy compared with scanning devices, according to Itochu.

For the Japanese conglomerate, which began as a textile business about 160 years ago, partnerships with startups like Tozi reflect its plan to "continue evolving in order to be in the textile business for another 160 years," said Hiroshi Morita, managing director of Itochu Textile Prominent Asia. Building a value chain using information technology is one of the ways the company is transforming itself.

Online size measuring has long been seen as a key technology for change in the fashion industry. The new system allows online customers to obtain just the right fit and design, something that has always been a challenge.

Shenzhen Tozi Technology can create a digital avatar out of just two photos. (Photo courtesy of Itochu)

In Japan, online fashion mall operator Zozo launched a system in 2017 to take measurements with a smartphone app, but it failed to take off due to problems with accuracy and production.

But the idea never died. Itochu started looking for partnerships with fashion technology startups in Shenzhen and Hong Kong in 2018. The company invested an undisclosed amount in Tozi last fiscal year, and is planning to spend more in the region, according to Morita.

Compared to other high-tech hubs like Silicon Valley and Israel, Hong Kong and Shenzhen have an advantage in the garment industry due to their proximity to manufacturers. Startups in these regions "can immediately bring and apply [their technology] to existing manufacturing bases," said Akira Sakai, IT business department manager of IPA.

With Tozi, Itochu plans to integrate the measuring technology with Itochu's sourcing capabilities. It has already created a system that links Tozi's measurement data with fabric cutting machines produced by French company Lectra so that individual sizes can easily be reflected in the patterns of partner factories.

Itochu rolled out a tailor-made shirt service in Hong Kong. (Photo courtesy of Itochu)

Inishirt targets 1.5 million dollars in sales to general customers, but the brand is designed to be more of a showcase for other brands and retailers looking to launch similar services using Tozi's technology and Itochu's networks. Itochu hopes to contract with over 30 companies in fashion and other sectors, including health care.

It already hooked up with Japanese apparel maker Taka-Q, and Morita says the company is also in talks with retailers from Vietnam. "With the coronavirus, the digital and e-commerce shift is accelerating; not just in Japan but also in the rest of Asia," he said.

Meanwhile, demand for business shirts and formal clothing in general is cratering as more people work from home. Itochu is adapting factory lines to produce casualwear, and bespoke services can also cater to such changes in demand, according to Morita.

As part of its Asian investments, Itochu is also in talks with a company that aids supplier networks, Morita said.

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