Forget the lean supply chain model. To operate successfully in today’s omni-channel, global marketplace, brands and retailers must put agility front and centre and focus on supply chain innovations and speed to market. That was the message at the ASBCI’s Digital Revolution conference.
Two decades on from the emergence of ‘fast fashion’ and the need for speed has never been greater. The drawn-out lead times from low-cost, offshore manufacturing are too cumbersome to meet the demands of today’s instant-gratification consumer. Instead, to reap the rewards of going global, retailers also need to go local – local manufacturing for local markets, and production and delivery cycles that are measured in days, not weeks. To achieve this goal, brands and retailers must embrace the opportunities of the digital age and invest in the technologies that will support the supply chains of the future.
More than a quarter of all clothing and footwear purchases in the UK are made online, said Sofie Willmott from Global Data, who opened the conference with an overview of the digital fashion landscape. The evolved user experience is helping to transfer spend online and pure-play retailers are seeing the biggest gains from the growth in ecommerce, which is predicted to increase by 30% across all categories in the next five years. The rapid growth of mobile shopping, the rise of delivery saver schemes such as Amazon Prime, improved fulfilment options, and a ‘see now, buy now’ consumer culture are key trends.
Technology might be constantly changing but human behaviour stays basically the same, said digital psychology expert Andrew Nicholson from GUkU. Most of our decisions are made on autopilot using cognitive short cuts, and retailers can take advantage of these unconscious thought processes to influence consumer behaviour. Andrew used live experiments to show how introducing ‘anchor’ products at different price points can change consumer’s buying choices, and how the use of ‘decoy’ products – premium goods with high price points that are introduced to make other options seem more affordable – can drive up spend.
The retail revolution is creating an omni-channel approach to meet the needs of the ‘see now, buy now’ consumer, said Glenn Littlewood from Coats. The seasonal approach is collapsing in favour of more agile methods of promotion and delivery. Lead times are reducing, styles are increasing, and orders are smaller and more frequent. To compete with pure plays, retailers and brands need visibility and collaboration up and down the supply chain, and that means investment in digital platforms like PLM and an end-to-end vision.
Ultimately, the message of the day was about agility. Traditional business models have been disrupted and businesses need to adapt to survive. And that means being flexible, throwing out rigid processes and policies that make change difficult, embracing technology, being open to new ideas and reacting quickly to customers’ needs. In a world of constant and rapid change, you’re either quick or you’re dead.
