You want it when?! Fast Fashion and the impact on Supply Chain Design
In today’s world of instant gratification and the need to get things as soon as possible, designing a supply chain that can handle the needs of consumers without exorbitant costs is essential to any new business. This is especially true for companies that rely on customization as their point of differentiation. Sarah Chessis, a former stockbroker turned entrepreneur, co-designed a software called Bespokify which enables consumers to order her custom clothing from her professional clothing company Bespoke & Co. The platform enables customers to input their measurements into the interface and produce designs that are immediately sent to the factory floor. The entire process to get an entirely customized professional outfit takes just 2 weeks. This is indicative of the new trend in the fashion world. That is, fashion is changing at an incredibly rapid pace and suppliers and manufacturers need to create a creative solution to keep up. This is a trend that was spearheaded by Zara, a popular clothing brand that is constantly restocking their shelves with the latest in fashion trends and often doesn’t offer the same designs for more than a few months. The newest trend is called “Click, Buy, and Make”. This means that producers don’t actually start production until after the consumer actually buys the product. This significantly reduces the costs associated with inventory holding costs and puts more strain on logistics and supply chain design.
Companies like Bespoke & Co. are forced to use a lot of the supply chain design and forecasting methods that we have learned in class to ensure their customers aren’t left waiting a long time for their products. Supply Chain strategy is defined as, “Designing a firm’s supply chain to meet the competitive priorities of the firm’s operations strategy”. In the case of the “Click, Buy, and Make” strategy, firms need to be able to rely on their manufacturers and suppliers to enable them to always have reliable access to the raw materials that they need to make any of their custom designs at any time. A good supply chain strategy will help alleviate costs and increase performance to ensure the firm is living up to their competitive advantage. Effectively managing supply chains in a highly customizable setting would require a significant amount of supply chain integration. A company like Bespoke & Co. could not possibly succeed if their supply chain resembled that of the our in-class donut example. The lack of communication would cause a nightmare for supply chain managers and inevitably create a bevy of backlogs and unhappy customers.
Another company that operates similarly to Bespoke & Co. is called Shoes of Prey which is a custom shoe company founded by Jodie Fox. Shoes of Prey struggled in their supply chain design because often times manufacturers require minimum orders of thousands of shoes and require months notice in order to deliver their orders. Her solution was to integrate her supply chain and open her own factory that was able to produce her custom designs in just a matter of weeks. She is heavily invested in technologies that can begin printing new shoe designs the second a consumer clicks buy.
Do any of you have experience with fast fashion? If so, what did you think? How do you think the focus on speed impacts quality of the product provided? Is there a better solution that could maximize their supply chain designs even further?
Sources:
https://www.wsj.com/articles/tech-powered-labels-deliver-custom-made-clothing-shoes-in-two-weeks-1523292648?mod=searchresults&page=1&pos=1
http://www.bespokeandcofl.com/#about
https://www.shoesofprey.com/
Fast fashion has made a significant impact on the fashion industry as a whole as well as the textile industry. Companies, like Zara, are able to launch new clothing lines every two weeks with a set amount of inventory, sell it all and then move onto the next product line. Becuase of this they are able to stay far ahead of trends, shorten their process time, and supply more to consumers. Even when you buy an item, you may not be able to return it after more than a few days because it could be likely that Zara no longer even stocks that product – that is how quickly they are able to move and the limited supply in which they produce each of their products. This has also affected the major fashion designers as they are still putting out 2-4 major lines each year. Zara is able to take the trends from these launches and runway shows, replicate them as a significantly reduced cost, and undercut the designers significantly while also producing at a high speed. This does come with some ethical dilemma of their product means pertaining to child workers, pollution, and poor material sourcing.
Adam,
This is an interesting blog post and it brings up an industry that has been forced to make significant management decisions around supply chain to compete in the retail market.
One company that I immediately thought of when reading your article was Stitch Fix, an online, “stylist-in-a-box” clothing company that utilizes data science and professional styling to predict the clothing a customer wants. Stitch Fix members fill out a “style-profile,” which stylists use to handpick a “Fix” of five clothing items- shoes, clothing, accessories, etc. Customers can then choose to keep or return any of the products they are sent in their “Fix,” and are only charged for the clothes they keep. The company released the following statement: “Our partnership between data science and expert human styling is core to what we do. It’s also what allows us to drive personalization at scale and we’ve been able to apply data science to many other challenges in retail, including inventory management, warehouse management, product development and supply chain — to name just a few.”
Stitch Fix’s innovative supply chain design has allowed it to grow quickly- making $730 million in 2016 and expanding from women’s into men’s clothes and plus-size, all during the midst of a tough time for the industry.
Link: https://www.racked.com/2017/5/10/15616224/stitch-fix-billion-dollar-brand
I have a significant amount of experience working in the fashion/retail space, both in fast fashion stores as well as smaller, custom boutiques. The customers at each store are different in nature, and I have been able to notice some differences in the way that both stores operated. I worked in a ‘fast fashion’ store and everything was controlled by higher management, as one would expect. We would get the several releases of new styles throughout each season despite the merchandise currently on the floor having only been released not long before. We didn’t have the greatest inventory management system so some of our inventory was getting ‘pushed to the back’ when new arrivals came and were getting overlooked, leaving customers without products. When inventory was out of stock, we directed customers to nearby stores or offered to order it. If we ordered it, it was usually a week long wait at the least…so customers would get the product just as a new release of clothing would drop in the store. Overall, the store didn’t operate as efficiently as it could of. The overwhelming amount of inventory led to a disorganization, and at some times, loss of sales. In contrast, the boutique I worked at most recently has a closer relationship with each vendor so despite only holding small amounts of each product, we are able to get the product in the customer’s hands in an average of less than a week. The small scale of the store obviously made it easier to manage the inventory and created a more efficient shopping experience for the customers.
Adam,
Thank you for discussion on fast fashion, and bringing in a company other than Zara to highlight the instant gratification trend in fashion.
Over winter break, I went on the Spiders in NYC: Marketing & Communications student trip held by Career Services where we visit various marketing and communications-related companies and departments where we have alumni. One of the companies we went to was Gap. At Gap, we talked to alumni in the fashion merchandising departments. They talked about how their job included a lot of consumer research on trends and fashion, including how to handle this newer idea of fast fashion. They showed us their “timeline cycle” which showed the start to finish of their business process – from research to the idea to planning to execution to selling point. They also discussed how they have had to find ways to adapt to the fast fashion mentality, and that their timeline, and the average retail timeline, (from research to store) has decreased by months just in the recent years. One interesting way they have done this is find the absolute newest trends by looking at the wealthiest and most fashionable class of people and what they’re wearing. Their research shows that the general ‘fashionable’ public wants to wear similar clothes. Therefore, they take similar fashions, styles, and patterns, and adapt them to be more affordable and then sell those.
Of course, this is a simplified explanation of their process, but it is an interesting way to “beat” Zara and companies of the like.
Adam,
Thank you for your interesting discussion about fast fashion’s impact on supply chain design. I find it impressive that companies like Zara are able to constantly communicate with suppliers to regulate the speed of materials flowing through the supply chain. I think by the very nature of fast fashion, consumers expect low product costs and ultimately a lower quality product. This is the trade-off for consumers. In the case of Zara, products are cheap and most likely are of a fashion trend that will mostly likely fade within a few months. This logic rationalizes the consumer’s purchase decision to buy a product knowing that it is of poor quality and will probably not last very long. On the other hand, Bespoke & Co., taking 2 weeks to produce a customized product, is a whole new industry where consumers are beginning to demand customized products in almost the same amount of time of a normal product. This poses a new challenge for supply chain design, forcing management to accurately forecast their sales as well as communicate these numbers in a timely manner to all parts of their supply chain.
When researching this topic, I found a lot of articles relating to how the industry of fast fashion is not environmentally sustainable. Because clothing falls apart so easily and is thrown away, landfills are becoming full of clothes. This material can sit for as long as 200 years before completely decomposing, leaving toxic chemicals to contaminate soil and groundwater. Because this industry is extremely unsustainable, I think the supply chain design will have to radically change in order for companies to produce more durable products in the same short amount of time.
https://www.forbes.com/sites/quora/2017/07/26/fast-fashion-is-a-disaster-for-women-and-the-environment/#62490f151fa4
Francesca,
I wonder if companies will try to ease people off of this “fast fashion” or find a way, as you noted
to change their supply chain design. I feel as though this industry is only going to grow as people become more and more demanding thanks to getting used to what they have now. I’m sure companies have seen the money to be made in this industry, and will sink money into finding new technologies to make this industry sustainable.