DHL: fashion retailers must re-think supply chains to react to unpredictable shoppers

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Retailers and manufacturers in the fiercely competitive fashion industry, need to have a supply chain that is as sophisticated as its customers, who generate unpredictable, 24/7 demand, according to a new report released by DHL.

Fashion Unleashed: supply chain innovation is everything by Lisa Harrington, president of the lharrington group and associate director of the Supply Chain Management Center and lecturer of supply chain management at the Robert H. Smith School of Business, University of Maryland, prepared in collaboration with DHL, focuses on the premise fashion retailers and manufacturers are re-thinking their supply chains, in response to rapidly changing and often unpredictable consumer buying behavior. These changes are being enabled by the internet, mobile communications and growing spending power, which has made volatility and complexity the norm rather than the exception in the fashion sector. 

Fragmented sales channels, escalated service demands, shortened product lifecycles, ratcheted up cost and margin pressures have all created production challenges, Harrington says. Add changing demographics, rapid growth in emerging markets, and the rise of the global middle class and you have the definition of uncertainty, she adds.

With an eye toward building in appropriate speed, flexibility, responsiveness and control, the report provides insights to help understand this new world order, where the internet has raised the stakes exponentially. Competition now comes from anywhere in the world, and observes no rules of time or place. Fashion companies must meet this new environment head on – or risk the consequences, claims DHL. In an industry where requirements differ by sector, channel and product this is no easy task.

With this understanding, the report explains how to service markets around the world with a supply chain this is agile enough to respond quickly to sudden or unexpected change, flexible enough to customise products and efficient enough to protect margins.

The report is based on an industry-wide survey and content from roundtable discussions with global industry leaders, who took part in a Fashion Masterclass earlier this year. Companies involved in the study and event include leading brands such as Betty Barclay, Debenhams, Hunkemöller, IC Company, Keen Footwear, Levi Strauss & Co and TOM TAILOR.

To download the report, please visit: http://supplychain.dhl.com/fashionagility2013