SUPPLY CHAIN OF

FASHION AND APPAREL

INDUSTRY
GROUP MEMBERS
ALISHA
AKRITI
GUNEET
SAGAR
MEANING AND DEFINITION OF SUPPLY
CHAIN
 Supply chain management is the handling of the entire production flow of a
good or service to maximize quality, delivery, customer experience and
profitability
 A supply chain is a network between a company and its suppliers to produce
and distribute a specific product or service.
 The entities in the supply chain include producers, vendors, warehouses,
transportation companies, distribution centers, and retailers.
 The functions in a supply chain include product development, marketing,
operations, distribution, finance, and customer service.
 Supply chain management results in lower costs and a faster production cycle.
SUPPLY CHAIN PROCESS
STEPS OF SCM INVOLVES

 Plan: Planning is imperative to control inventory and manufacturing

processes.
 Source: Sourcing is identifying vendors who will procure goods and services to
meet planned/actual demand in the most economical and efficient way.
 Make: As per the preference of the consumer, the firm will perform all
activities related to the transformation of raw material to the final product.
 Deliver: Another most important component of supply chain management is
contributing to direct/indirect integration with the consumers.
 Return: It is a post-delivery customer support process that is associated with
all kinds of returned products. It is also known as Reverse Logistics.
Why Supply Chain Management Is Crucial in the
Apparel Industry?

 Advanced supply chain management (SCM) benefits practically every industry. In

apparel, where fast fashion, ever-shifting trends and micro-seasons numbering in
the double digits impact the entire industry, it’s critical. Fashion retailers must
carry a wide variety of products to fit many customers’ preferences
 Demand forecasting is also challenging in the fashion industry. Since fashion trends
come and go so quickly, every product at the start of the season has no sales
history. Therefore, retailers can’t look at the past year’s sales numbers to
determine how a product will perform
 Without an advanced, competent SCM structure, apparel brands and retailers
struggle to meet consumer needs. Their inventory costs increase while product
quality and suitability for the target customer decrease.
How clothing supply chain management
works?
 In fashion industry , supply chain breaks down into five main links:
 1. Design
 2. Textile manufacturing Textile
DESIGN
manufacturing
 3. Apparel manufacturing
 4.Distribution
 5. End user purchase Apparel
Distribution
manufacturing

End user
purchase
CONTD.

 Design: In the first step, fashion designers choose fabrics, trims, fits and finishes for clothing
items and carefully plan each silhouette. They often create their own iteration of the latest trend
or may create the runway looks that others want to replicate. Designers are often the ones directing
the rest of their supply chain. For example, they approve the fabrics and materials manufacturers
use, alongside the sellers that carry their products
 Textile manufacturing: Each garment requires raw materials. Textile producers spin, weave,
blend and dye cloth and create other materials for the final product.
 Apparel manufacturing: Next, garment makers cut the cloth and sew it into wearable
pieces, following the patterns and designer specifications.
 Distribution: Distribution in the fashion industry is complex since raw materials and finished
apparel are produced worldwide and imported into key markets. Items may be shipped directly to
retailers or to a distribution center that may feed multiple retailers. A well-managed supply chain
includes detailed tracking, allowing brands to manage and optimize transportation and know exactly
where shipments are along their routes.
Contd.

 End-user purchase: At the end of the supply chain, a customer purchases the
item. They may buy it from a brick-and-mortar retailer, shop online or choose
a “buy online pick up in-store” (BOPUS) option. For online retailers, this
portion of the supply chain places greater importance on logistics and
transportation management. Brick-and-mortar retailers must emphasize good
sales floor and storeroom management to please in-person and BOPUS
shoppers. All retailers must focus on inventory management to ensure they
can sell to consumers however they prefer to shop.
 MARKET PLAN OF OUR BUNISESS
Cash Required $469,000
Start-up Expenses
Start-up Inventory $39,000
Other Current Assets $240,000
Legal $222,200
Long-term Assets $287,000
Consultants $0
Insurance $23,000 TOTAL ASSETS $1,301,000

Rent $33,000 Total Requirements $1,648,600

Research and Development $10,000 START-UP FUNDING  
Expensed Equipment $56,000 Start-up Expenses to Fund $347,600
Signs $3,400 Start-up Assets to Fund $1,301,000
TOTAL START-UP EXPENSES $347,600 TOTAL FUNDING REQUIRED $1,648,600
Start-up Assets $266,000

TOTAL ASSETS $1,976,000 TOTAL LIABILITIES $66,000

TOTAL CAPITAL AND LIABILITIES $1,976,000

Total Funding $1,648,600
Assumptions

 ASSUMPTIONS
 We are assuming a healthy economic situation in market for next couple of
years.
 The financial development is basically to maximize sale from the expense.
 The major cost projected will be on first year as the in the first year the
expenses will be high because to set up a business.
 The revenue will start increasing once the customer gets to know about out
services
STRATEGIES

 Fashion brands often use one of three strategies to manage their supply
chain:
 Push Supply Chain: A push supply chain strategy uses market forecasting and predictions to
drive the supply chain. Producers and designers create clothing pieces in anticipation of upcoming
demand. They then “push” these products to end-consumer retailers. In fashion, warm weather
wear appears on shelves at the end of the cold season in preparation for the increased demand as
the weather heats up.
 Pull Supply Chain: The pull strategy waits for demand to rise rather than forecasting it.
Manufacturers produce new items only when they know consumers will buy them. In other words,
end-users and consumer-facing retailers pull apparel through the supply chain. This reduces the risk
of inventory becoming overstocked while increasing the risk of not meeting a sudden influx in
demand.
CONTD.

 Hybrid Push/Pull Supply Chain

Fashion brands can combine both supply chain strategies using the push/pull
method. This helps brands save on inventory costs while reducing the risks of
unpredictable demand, which is so common in the fashion industry. Under this
configuration, the supply chain starts as a push system, where textile producers
constantly create fabrics in anticipation of new garment designs. The demand for
new fashion pieces pulls these materials into garment production plants and the
rest of the supply chain to end consumers.
BENEFITS

 Operational and Organizational Flexibility: Managing a diverse supplier network and

staying in close contact with key suppliers across that network helps companies do this more
effectively

 Minimized Inventory Costs: Fashion retailers who work well with a diverse supplier network
can minimize costs in many ways. First, they can get samples and quotes from several suppliers
before committing to new orders. Next, by effectively forecasting needs, retailers can order less
safety stock.
 Better Resource Management: less wastages, optimum use of resources
 Increased Productivity and Better Logistics Management: Better communication
and collaboration with all tiers of suppliers help clothing brands continue producing
goods in all circumstances. They’re less likely to face disruptions related to supplier
delays and wider raw materials shortages
6 keys to successful supply chain management

Match
Establish Make
Find the supply Improve Enlist the
alliances technology
right with key
chain and the flow of
work for
assistance
people business information of others
suppliers you
line
Decision-Making Skills for Supply Chain Management
Professionals

 The ability to identify problems in the supply chain

 The ability to develop and communicate solutions
 The ability to identify trends and opportunities for greater efficiency,
quality and cost savings
 The ability to generate or source the data you need to make well-informed
decisions
 The ability to incorporate legal and regulatory considerations into your
decision making
 The ability to be flexible to events
Conclusion

 As fashion retailers grow, their supplier network becomes more complex and
interconnected. When you have many vendors, it’s useful to standardize your
supplier expectations and management practices. More complex supply chains
that require more time to get products from raw materials to end consumers
need more management. As you decide whether it’s the right time to
implement a new SCM system, consider your current level of vendor
complexity and your plans for the future.
REFERENCES

 https://www.bdc.ca/en/articles-tools/operations/purchasing/determining-su
pply-chain-solutions
 https://supplychainmanagement.utk.edu/blog/decision-making-for-supply-ch
ain-managers/
 https://www.purolatorinternational.com/what-to-know-about-fashion-appare
l-supply-chain-management/
 https://www.investopedia.com/terms/s/scm.asp