Effective supply chain management in the fashion industry is what will determine if the product will reach the customers on time, and in the best condition. Any clothing brand that doesn’t have a supply chain strategy will struggle to compete in the market. And it will only be a matter of time before they will be kicked out of the market.
What is Supply Chain Management in the Fashion Sector?
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The fashion supply chain can best be defined as the process of tracing each step of the clothes manufacturing process, from sourcing of the raw materials, to the factories where those materials are made into garments; and the distribution network by which the clothes are delivered to customers.
To grow a successful fashion brand, you must understand how the supply chain works.
Importance of Supply Chain Management in the Clothing Industry
Why is managing the supply chain in the clothing industry important? This is because a well-managed supply chain can to a large extent reduce your company’s operating costs and increase the profitability of your business.
Why is optimizing your supply chain important in the garment industry?
Automating Operations Will Give Your Fashion Business More Flexibility
Efficient supply chain management means that the operations within the supply chain are being carried out in the most optimum manner possible. Therefore, you will not have to worry about optimizing operations further. When such is the state of your business, you can focus on business development. This will also help you to get a greater degree of operational flexibility since you will be automating many operations.
Effective Management of Resources
The only way to fully utilize your resources in the fashion industry is to manage your supply chain efficiently. To get the best of your fashion business, you must learn to manage your raw materials, warehousing capacity, packaging, and transportation effectively.
Businesses in the apparel industry do not joke with their supply chain management because of how it helps them to cut off the waste.
A Good Fashion Supply Chain Helps You Satisfy Your Customers
Would you like to increase customer satisfaction in your fashion business? The easiest way to guarantee that is to ensure your customers get their product delivery on time. I know you’ve learned how to explain a late delivery to a customer but you don’t have to wait to piss the customer off.
To retain more customers and also grow your customer base, start implementing effective supply chain strategies. Doing this will help you grow your garment-making business and expand it to more locations.
Why Zara and H&M Supply Chain Strategies Work
With an employee capacity of over 165,000 people worldwide and over 10,000 in Spain alone, Zara is one of the largest fashion brands globally. Zara has nearly 3,000 stores across the globe with 547 of them sited in Spain.
For Zara to have managed to sell 85% of their clothes at full price, therefore, means that there’s a supply chain strategy they are using that every fashion brand needs to learn.
To achieve an efficient supply chain, Zara determines only 20% of a season’s line 6 months in advance, entering the season with 50% of committed inventory. For the remaining 50% of its line, it adopts just-in-time production, a practice that helps them to respond to any “of the moment” trends or customer preferences.
The key to Zara’s ability to establish an agile Supply Chain rests on the following unique approaches: Procurement Methodology: Zara’s Procurement team doesn’t work on the number of finished clothes but on the number of raw materials needed to manufacture the clothes.
H&M’s supply chain strategy is based on speed, agility, and short lead times, which have been a major factor in its success, giving it a clear competitive edge by allowing collections to be changed regularly.
This supply chain strategy has helped H&M to be able to build 4,801 stores across the globe and establish their presence in 75 markets.
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