By: Olivia Colman
Fashion fiends are hard to please. One day skinny jeans are all the rage, then the next day there is widespread internet debate over whether straight-leg jeans will take the crown. With trends, demands, and priorities shifting at high speeds, how do you keep customers of the fashion industry satisfied?
The answer is optimized, customer-driven supply chains.
Clothing defines both society as a whole and people as individuals. Fashion is an everchanging industry with factors that shape the styles that weave in and out of popularity. This complicated nature creates space for constant improvement. An increased focus on the optimization of fashion supply chains will increase sustainability, overall customer satisfaction, and company profits.
It’s All About the Earth
Sustainability and supply chains are closely linked because of the manner in which clothing is manufactured. With enormous amounts of water, pesticides, and chemical products used in manufacturing and shipping, the clear answer to increasing sustainability is making cleaner improvements to these elements of supply chain.
In 2017, 42 out of 100 fashion companies disclosed their supplier information.[1] Increased visibility encourages sustainability and gains the loyalty of the modern consumer.
Since sustainability is such an important priority in the minds of many consumers, “an effective sustainable fashion supply chain helps companies to enhance brand image and reach a wider range of ethical consumers.”[2] Sustainable supply chains have become more than just ethics—they now hold the power to either propel a company into success or pull them down towards failure. This is especially true in the fashion industry since there is so much room for improvement surrounding sustainability.
It’s All About the Customer
A focus on optimizing fashion supply chains means a focus on the demands of customers. According to the State of Fashion Report in 2018, the most efficient way to satisfy customers is by “building agile supply chains supported by higher-quality consumer insights.”[3] When supply chain prioritizes satisfying customer wants, businesses will gain the loyalty and return of customers.
Additionally, supply-chain-focused companies deliver merchandise in a timely manner, given their focus on optimization. Since on-time deliveries are a top priority for consumers living in a world of instant gratification, this delivery speed will further increase customer satisfaction.
Within the fashion industry, satisfying the customer is crucial because the product being sold becomes part of a customer’s personal identity. In most industries, customer satisfaction is king because the product sold is important to the customer. When fashion companies focus on supply chains that are “resilient enough to withstand shocks, agile enough to respond quickly, . . . flexible enough to customize products, and efficient enough to protect margins,” they successfully aid their customers in confidently expressing themselves through clothing.[4]
It’s All About the Customer (Again)
Fashion companies can increase profits by implementing lean supply chains. Lean supply chains consist of “a network that can replenish required inventories as they are needed,” meaning that the driving factor to improve overall profits will always be consumer demands. In 2016, the top 20 percent of fashion companies, which are the companies most focused on a lean supply chain, generated 144 percent of economic profit.[5] The consumer is always the key when it comes to supply chains.
In addition to leading the industry in economic profit, “customer-focused supply chain strategy provides an approach to respond to competitive challenges and hence they are most likely to prosper within today’s competitive global landscape.”[6] Leading a fashion company with an optimized supply chain not only creates a leading economic profit, but also a competitive edge over others because customers give their money to companies who value them.
It’s All About the Process
With power in the hands of fashion consumers, only supply chain focused companies will thrive. As companies focus on optimizing their supply chain, the demands of their customers will be easier to meet as an optimized supply chain will allow companies to quickly shift inventory with customer demands. Companies in the fashion industry need to take advantage of the abilities and advantages that optimized supply chains provide in order to develop and flourish in the future.
Put simply, supply chains are a process, and unless companies take control of the process instead of letting the process control the company, they will not find success. Learning is the first step to taking that control, so the most important first step for any fashion company is to learn about the power of customer-driven, optimized supply chains. This knowledge will give any company opportunity to be the leading competitor in the fashion industry.
[1] Imran Amed et al, “The State of Fashion 2018” The Business of Fashion and McKinsey & Company (2018). https://cdn.businessoffashion.com/reports/The_State_of_Fashion_2018_v2.pdf.
[2] Ben Shin, “Sustainable Fashion Supply Chain: Lessons from H&M”, Sustainability 6 no. 9 (2014): 6236-49. doi:http://dx.doi.org.erl.lib.byu.edu/10.3390/su6096236
[3] Amed, “The State of Fashion 2018”
[4] Sabet, Ehsan, Nahid Yazdani, and Sander De Leeuw, “Supply Chain Integration Strategies in Fast Evolving Industries,” International Journal of Logistics Management 28, no.1 (2017): 29-46, doi:http://dx.doi.org.erl.lib.byu.edu/10.1108/IJLM-01-2015-0013.
[5] Amed, “The State of Fashion 2018”
[6] Pankaj M. Madhani, 2018. “BUILDING CUSTOMER-FOCUSED SUPPLY CHAIN STRATEGY WITH 4R MODEL,” Journal of Contemporary Management Research 12, no. 1 (2018): 14-32, http://erl.lib.byu.edu/login/?url=https://www-proquest-com.erl.lib.byu.edu/scholarly-journals/building-customer-focused-supply-chain-strategy/docview/2048049029/se-2?accountid=4488.