SaaS startups tailor new green solutions for fashion industry

Time of India

18-07-2025

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Frequent returns, oversupply and environmental concerns are among the challenges the fashion industry has been facing for a long time, and it is no surprise that the UN has said that the fast fashion industry accounts for about 10% of the total global greenhouse gas emissions. As consumption of fashion rises, artificial intelligence (AI) is stepping in to reduce the ecological harm.Software-as-a-service (SaaS) firms like GreenStitch and Stylumia are helping brands and manufacturers automate climate compliance, track carbon emissions with precision, and make more sustainable operational choices across their supply chains.These startups are using their AI-driven platforms to help brands with audit-grade carbon accounting across Scope 1, 2 and 3 emissions, manage inventory, reduce wastage and move beyond fragmented, manual processes of compliance. Scope 1, 2 and 3 emissions are three categories of greenhouse gas emissions to help organisations understand and manage their carbon footprint accordingly.Data is key: platforms collect huge datasets from the brands and manufacturers to help them become sustainable. For instance, the AI-backed data platform of Bengaluru-based startup GreenStitch gathers millions of unstructured data points from brands and manufacturers. This includes product-level details such as energy and fuel types, material purchases and water intake and sources. It is then used to identify and fill knowledge gaps within a brand's environmental reporting.GreenStitch also produces reports with actionable insights for the companies. 'Brands first need to understand where they stand in terms of sustainability, before modelling a plan forward,' founder and CEO Narendra Makwana told ET.Brands traditionally used consultancies to understand their sustainability and then to scale it across products. Greenstitch automates these processes in order to prevent companies from seeing sustainability compliance as a burden. About 40% of their reporting workflows are already AI-powered.'Let's suppose a company wants to shift from normal cotton to the more sustainable BCI (better cotton initiative) cotton. How would this decision help in terms of their entire emissions? If they want to move from coal to biomass, what sorts of emission savings are they doing? How would that impact costs and returns on investment (ROI)? That's what we attempt to answer,' Makwana told ET.Wastage is another concern for the fashion industry. The traditional fashion supply chain struggles with inefficiencies in production and a tendency to overproduce, according to experts. Platforms such as B2B clothing manufacturing platform Zyod and trend forecasting solutions company Stylumia address this issue.Zyod, which has Reliance Industries Limited, Aditya Birla Group, Van Huesen, NEXT and Firstcry, among its clients, uses AI to streamline its manufacturing process. It also aims to cut waste by optimising resource allocation and production schedules. By analysing data from previous collections and current market trends, the company forecasts demand, ensuring that only necessary quantities of materials are used.'If we take a simple example of fabric planning. Maximum loss – which is about 50% – is incurred from material. Using nesting software, which optimises the fabric usage and demand supply planning, one can have at least a saving of 8-12% of fabric,' said cofounder Ankit Jaipuria.The Gurgaon-based startup, set up in 2023, uses AI to also address labour efficiency. Using AI, the platform expects to help brands achieve labour efficiency of 90-95%, up from 50-60% now.Stylumia claims that current expert-led wastage control mechanisms are broken, noting that waste generated is in the order of over 70 billion garments a year and growing at 6% per annum. It uses its proprietary AI platform, Demand Sensing, along with machine learning algorithms to read consumer demand signals.It was set up by former Myntra chief operating officer Ganesh Subramanian in 2015 to help fashion and lifestyle businesses take decisions based on data mined from user behaviour and social media activity, among other tools.Fashion brands and online retailer giants are going beyond the AI assistant feature on their platform and using data and AI to predict demand.For instance, new-age fashion brand Newme is among enterprises prioritising sustainability through tech and data solutions, with a team of about 30 members dedicated to the task. It also uses AI for supply chain management.'AI has been deeply embedded in our supply chain – from design creation to demand planning. We are also exploring AI now in trend prediction and finding ways to identify hero styles based on past data and browsing behaviour of customers,' cofounder Sumit Jasoria said.Through efficient supply chain management, brands reduce oversupply and wastage. 'We have inventory write-offs in very low single-digit percentage points and it is at least 10 times lower than the industry average,' said Jasoria.Bigger online retailers like Myntra and Flipkart are using website data and AI to identify emerging trends for forecasting demand.'Our AI-powered trend tech stack synthesises internal data such as search, browse and purchase behaviour, with external signals from creator content, brand intelligence and specialised research agencies to codify both macro and micro fashion trends,' said Lakshminarayan Swaminathan, vice president for product management & design at Myntra.Similarly at Flipkart, senior vice president Pranav Kumar Tiwari said, 'Our AI models identify emerging trends across the internet, from across the social media channels, and map those trends to its catalogue in real-time.'India is estimated to generate 7,800 kilotonnes of textile waste annually, according to a 2022 report by Fashion for Good, a global platform to support innovation in the fashion industry.