Factors controlling the fashion supply chain
Accelerate speed to market– There is a perpetual need to reduce all potential process (planning, design, development, sourcing, production and distribution) timelines to hit in-store dates. The foundation of an effective product development process involves optimizing these functional areas.
Effective collaboration– Ensuring the right level of communication improves process efficiency and product reliability. Collaboration is critical to both the internal cross-functional teams (planning/design/development) as well as external partners (sourcing/production/distribution) involved in building the products.
Single source of truth– The fundamentals of product development require visibility to the current product and related information during the particular time-slice. Moving away from sharing physical documents and managing data with systems ensures teams are always working with the relevant information.
Cost reduction– A streamlined process reduces the number of cycles/iterations, thereby minimizing potential issues. Additionally, identifying geographically positioned vendors to optimize delivery costs or recommend cost-effective variations to reduce product costs.
Alignment to seasonal timelines– A tight integration not just between internal functions, but other SCM, ERP, etc. systems is critical to ensure alignment to the seasonal calendar. Brand owners have to constantly track their lines and have the ability to proactively/reactively address issues.
Compliance management– Corporate social responsibility is now widely accepted as a core element of fashion design. In addition to the corporate mandates, brands now need to cater to environment-conscious consumers, for whom compliance is a major shopping factor.
Classification of fashion brands – in response to the supply chain demand
Based on market-focus, consumer demand and their internal operating model, fashion brands can be broken down into 3 distinct types. Each targeting a specific consumer base by following an effectivity delivery cycle.
Traditional fashion– Versace, burberry, yves saint laurent, etc. Each line within a traditional fashion house revolves around a designer. During ideation, they travel around the world, looking for inspirations for their seasonal collection. These new trends could include styles, materials and colors concepts–traditionally based on previous successful lines. Each designer typically works with a specific factory to release the product to market. Prices are typically high with long development cycles.
Private label– St. John’s Bay (JCP), alfani (macy’s), prologue (target), etc. retailers may choose to leverage their larger manufacturing network to produce private label products, eventually sold as their own brand. Typically, these brands have no dedicated designer, as most of the design is outsourced. The concept was to provide consumers, especially those loyal to the retailer, with an assortment of cost-effective alternatives through the season. However, some private labels now position themselves are competitors in the “premium brand” market.
Fast fashion– zara, H&M, uniqlo, etc. Fast fashion brands have a strong consumer focus providing imitations of the latest trends and styles introduced on the runway at fashion week. With a model that involves manufacturing most products in their own factories or those near their design offices, brands can drastically cut down the end-to-end production time and costs. Additionally, these compressed durations allow for a more continuous delivery model by additional seasonal releases.