5 Tips for Fashion Retailers improve their Supply Chains
Due to the drop in garment prices in the past 20 years, we have been able to buy more and more clothing. We now own 5 times the amount of garments our grandparents did. Buying these ‘disposable’ garments felt great until we found out what was going on behind the scenes, or its impact on the environment. The fashion industry is not as glamorous as it may seem. According to the VN-conference of Trade and Development (UNCTAD), the fashion industry is the second most polluting industry after the oil industry. Also, the fashion industry produces 20% of the global water pollution and 10% of the global CO2 emissions - more than all international flights and shipping combined. In addition, dying textiles is the second-largest cause of water pollution.
Luckily, sustainability has become a keyword in the fashion industry and consumers are becoming increasingly aware of the processes behind their garments. With this pressure, brands and retailers are being forced to change the way they develop their goods.
What is a supply chain?
A supply chain, in commerce, is everything the company does to get the product available to the customer. It starts with the raw material, then the production, it might be held in a warehouse and then eventually transported to the retailer.
What can brands and retailers do?
According to Leonie Barrie, apparel analyst at GlobalData, there are 5 key rules that companies should incorporate to achieve more sustainable and circular supply chains:
More flexible sourcing networks
Rebalancing apparel supply chain
Embracing strategic supply partnerships
Speed up digital innovation,
End-to-end visibility.
In other words: digital, predictive, transparent, and partnered.
Digital Innovation
Implementing digital innovation can reduce overproduction. By using digital systems and platforms, both factories and retailers receive real-time updates which can help overcome errors and thus overproduction. This way, they can monitor, alert, and predict milestones and challenges for fabric suppliers, manufacturer production capacity, and international delivery automatically make it faster and easier to plan experience and data-backed supply chain structures and maneuver.
Tech does not only come in handy with the logistics, due to digitalization, (fashion) companies can also use this data. By analyzing the data, companies can predict trends and sales, inventory needs, and automate customer interaction. It can help companies make inventory decisions, and thus overcome overproduction.
End-to-end Visibility
To reduce the environmental impact caused by a supply chain, a company could take a closer look at the suppliers an organization is working with, their partners.
An example is New Balance Athletic Shoe Inc. They have reduced the number of suppliers they use. The footwear brand has chosen only to work with suppliers that meet their sustainability criteria and cut down on 65% of their suppliers.
One of their criteria would be that transportation is run on renewable sources. For the suppliers they have chosen to work with, they are focusing on building strong, long-term partnerships.
Sustainability will always go hand in hand with transparency. Customers are now researching products before they buy them according to McKinsey, 52% of millennials, 45% of Gen-Z, and 41% of Boomers research businesses before buying. For brands performing sustainable practices, it is especially necessary to give consumers insight in how their goods are developed.
The same goes for operations within the company, invisible for the consumers. Working with transparent supply chain partners makes it easier to maintain timely and accurate accounts of materials, production status, and product quality (again to overcome waste). The value of that transparency increases if partners can offer clear, specific communications as well as visual and/or third-party authentication of sourcing, production, and distribution.
Another way to make a supply chain more circular is reconsidering the packaging that is used, also during transportation. Clothing is often put on plastic logistics hangers, or in boxes, and sometimes each individual piece is wrapped in plastic packaging, only for transportation. The logistics hangers are then changed for in-store hangers, which can only be seen as a waste.
It does help to bring the product to the store faster yet at the expense of planet earth.
How does Kleiderly contribute?
At Kleiderly, we have made it our mission to reduce the global fashion footprint by deriving and reusing clothing waste from landfills and incinerators. We give these valuable resources a new life by recycling them into a sustainable plastic alternative, hence solving two environmental problems at once. Spreading awareness about the impact of clothing waste is a part of reaching this mission.
Sources
https://www.retailgazette.co.uk/blog/2021/03/fashion-retailers-improve-supply-chains-covid19boohoo/
https://blog.makersvalley.net/a-modern-fashion-supply-chain
https://blog.makersvalley.net/digital-supply-chain-protect-during-covid
https://www.greenbiz.com/article/6-steps-more-sustainable-supply-chain
