With growing competition and diversifying markets in thevolatile fashion world, companies are looking at gaining market share byincreasing product diversity in apparel. This factor - determined by attributessuch as design, size and fit - leads to wider manufacturing parameters, whichin turn affect delivery schedules and quality of the product. This is one ofthe most common problems faced by the Apparel Supply Chain where scheduling ofwork becomes complex due to demand variability.
It becomes difficult to manage the product with respect totime and cost. Additionally, global outsourcing makes the Apparel Supply Chaineven more competitive. It is necessary to get the right product at the rightplace and at the right price. Hence, focusing on the impact of productdiversification on the operational structure of the Apparel Supply Chainbecomes important.
Impact of product variety
Product proliferation can be mapped at the retailing and manufacturinglevels. Hundreds of different apparel stock-keeping units (SKUs) can beproduced from a given fabric. In addition to the proliferation, a retailer mayask for the product to be shipped with specific instructions such as specialpackaging or a particular method of folding. Further diversification withaccessories will increase the diversity at the retail level.
A highly diverse product mix also requires an increasednumber of lots at various stages of production. This multiplicity inmanufacturing batches complicates the nature of operation in terms of:
a. Loss in productivity:
In fibre dyeing, the reprocessing required to match theshades increases with the number of lots, requiring more time. Similarly, inspinning or weaving processes, the occurrence of changeover increases with ahigher number of lots. Frequent changes in product diversity also result inuneven processing and hence, loss of productivity.
b. Value loss:
Material loss increases with an increase in the number oflots as a fixed amount of material gets wasted in every lot irrespective of thelot size. So, more waste is produced with a higher number of lots.
In manufacturing, developing a marker becomes increasinglydifficult with increasing diversity. As a result, material waste in patternmaking and cutting increases along with under utilization of the fabric.Product mix also ends up generating more goods of inferior quality at the endof every process.
c. Difficulty in assortment planning:
To capture consumer interest, it is necessary to put all theassortments of a product line on the shelf at the same time. This requiresconsiderable planning at every stage of the Apparel Supply Chain. However,proliferation of lot sizes hampers the success of assortment planning. To moveall the assortments of a particular style out of the warehouse, it is necessaryto harmonise the movement of the lots in a way that the entire assortment isavailable at the cutting stage. However, each component has a differentprocessing time, making it difficult to push the assortment together in theApparel Supply Chain. This ultimately results in lost sales on the shelf.
d. Poor asset management:
Components for a particular product are required to beprocessed together. But with the increase in variety, the time taken for anindividual component increases, thereby resulting in a higher amount ofwork-in-process at various stages of operation. Goods dispatched from thewarehouse also suffer as the products reach the warehouse late.
It is now clear that a wide spectrum of product mix has animpact on the operational levels of textile and garment units. This leads to afailure in delivery commitment and poor quality, leading to a significantincrease in manufacturing cost.
Tailoring the product mix
There is already a high degree of variability in retail due to the changing fashion scene and the short season windows. Product lines multiply with the introduction of new segments every season. For example, apart from the established lines such as golf, tennis or swimwear in sportswear, a new segment called 'yoga' wear might be introduced.
Moreover, sizes and fits vary greatly from one market to another on a global scale. This tends to intensify SKU availability at the retail level.
Retailers need to manage this diversified product line through different stages like product development, outsourcing apparel, sample approval, production, distribution and merchandising, etc., across vast geographical distances. By increasing the product mix, the complexity of the operation is magnified many folds over.
Many times the impact of product proliferation goes unnoticed by the retailer or buying houses as organisations in the Apparel Retail Chain are seldom interconnected and there is very little coordination between players.
Retailers have to realise that they cannot just focus on purchasing and selling, but need to pay close attention to the entire Supply Chain since delay at one stage in the chain will ultimately affect them. Based on the configuration of the Apparel Supply Chain, the retailer has little scope to exercise control in this process.
Garments are made from a combination of fabric from a company, snaps from another and buttons or zippers from yet another, all of which must come together in time for the finished product to be placed on the shelf.
As product development consists of developing and selecting fabric swatches, deciding garment style and merchandise flow, proliferation of product mix leads to higher costs and longer design-to-market cycle time. Typically, design-to-market time for fashion products is six to nine months, of which 70 percent of the time is spent on non-value-added activities like communication delay, non-approval of merchandise at various stages and waiting time for assortments.
A judicious product mix in basic textile helps in making the entire apparel Supply Chain more manageable without having to sacrifice the end diversity in apparel style, fit and size that capture the customer's imagination.
Originally published in "Inside Fashion: The Magazine on Fashion & Retailing"; Vol 9: No. 8
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