Digitization is a critical topic for apparel companies worldwide. Today some companies are making significant progress with digitization -to reduce lead times, boost innovation and collaboration and better understand and serve customers’ needs. Digitization will end with success if it is integrated into a broader transformation to a customer centric operation model. To realize the promise of greater speed and agility,companies need to increase their efforts to optimize country selection, supplier collaboration, compliance and risk, and end-to-end efficiency .
Apparel executives are dealing with a volatile, fast changing environment along with the increasing competition and increasingly savvy consumers. That is driving an urgent need for greater efficiency and flexibility along the end-to end sourcing chain.
In the past years apparel buyers have shifted sourcing to lower cost countries. Today some traditional low cost countries are loosing their attractiveness. As executives seek to step up their companies’ agility, there is also fresh focus on proximity sourcing and re-shoring.
Digitization could enable companies to achieve a step change in performance, transform to a customer -centric operating model, and create transparency throughout their global supply chaings.
While the industry is facing volatility and complexity, digitization will support apparel industry in improving predictability, efficiency, decision making and accuracy.
Today, volatility has manifested itself in many ways. Exchange rates, raw material prices, oil prices, interest rates, pandemic uncertainty are some of them.
On the other hand consumer preferences are changing rapidly. New online fast fashion players are gaining ground. Minimum order sizes are falling, suppliers are increasing their flexibility.
There is a challenging outlook for the fashion industry. In the future the winners will be those that maket he shift from a supply to a demand focus, ramp up their speed to market, become much more flexible and rebuild their supply chains end to end.
Digitization of sourcing processes is seen as a key enabler. Faster progress on digitization will be essential to unlock greater efficiency, flexibility, collaboration, and speed across apparel supply chains.
So far, the promise of digitization in the apparel industry remains unfulfilled. Digitization can help usher in a new business model for sourcing as the apparel industry moves from a focus on supply to a focus on consumers .Companies need to adopt an end to end perspective and foster collaboration across functions and through strategic partnerships with suppliers.