Unlocks for the future fashion sourcing landscape 2017

Economic uncertainty and upheaval in global trade agreements are immaterial if the apparel and footwear industry can't respond, engineer and produce products that consumers want to buy. Investment in automation and efficiencies, as well as facing up to skills shortages, are among the unlocks for the future fashion sourcing landscape.

Unlocks for the future fashion sourcing landscape 2017By Leonie Barrie | 22 March 2017Font size Email PrintWhile technology is key to improving the efficiencies of apparel production processes and operations, it also requires changes to skillsets within supply chainsEconomic uncertainty and upheaval in global trade agreements are immaterial if the apparel and footwear industry can't respond, engineer and produce products that consumers want to buy. Investment in automation and efficiencies, as well as facing up to skills shortages, are among the unlocks for the future fashion sourcing landscape."As an industry we're not very good at revolution, we struggle with evolution.

We should be re-engineering the product and the process driven by what the consumer demands," says Stuart Cranfield, global head of supplier working conditions at British-based shoe manufacturer and retailer C&J Clark International."We're still making shoes the same way; we haven't moved on, and we've got to change. We've got to look at materials, we've got to look at the sources, the technology. We've tinkered around the edges but haven't made fundamental change," he told delegates at last week's Prime Source Forum conference in Hong Kong."It doesn't matter what the duty is if we haven't got this part right."Colin Browne, president of global sourcing a US sportswear giant Under Armour, agrees. "We need to completely change the dynamic of how we think about this industry, and it's going to require us to not just think in straight lines. We're not going to start making products in America and running the same inventory control models; it's going to be a very different model.At this moment in time we're still operating like a relay race where we're passing things along the chain, where actually we don't need to be doing that any more"It's about partnership, and connecting with those few key partners who really understand our vision and also understand the values we're trying to propagate within our brands and within our businesses as well. At this moment in time we're still operating like a relay race where we're passing things along the chain, where actually we don't need to be doing that any more."The need for change, he believes, extends to the very definition of the sourcing role. "Sourcing implies we're going out exploring to find extra-cheap countries. How about product supply? Supply chain isn't right either...it suggests a series of events one after another; it's not a chain. Maybe a supply circle with the consumer in the middle. Or value-stream management."Automation and efficienciesAnne-Laure Descours, global director, development and sourcing apparel at sportswear specialist Puma, also emphasises the challenges facing today's apparel industry and its supply chain are "more complex than trade agreements." Restrictions are everywhere, she notes, citing the new French Duty of Care law (Le Devoir de Vigilance) covering human rights in global supply chains.She believes the need for transparency is also changing the game. "The partnership between buyers, brands and manufacturers of both garments and materials is critical because the whole chain collectively has to improve and do things better...and we have the tools around us that can make that possible."Another change in the manufacturing landscape is the move towards automation, she adds, citing one pilot factory in China where the entire process from fabric in to cutting is automated using robots. "Once you start to partner with suppliers and give them visibility of your long-term plan you also give them the potential to invest into efficiencies like automation and robotics."In Puma's apparel business we have ten suppliers who do two-thirds of our sourcing. So when you have this level of partnership with state-of-the-art suppliers then you can really engage in a discussion about what is needed for your business and what is needed for their business and find the best way to get there."Automation is a need from both a garment manufacturing and material sourcing perspective, and that's going to be one of the ways to gain speed, better planning and forecasting – and our industry has lacked investment in technology for a long time."Speed to market"Automation isn't new, but what has got better is the flexibility to maximise our speed to market," explains Vance Shore, head of sourcing at Levi Strauss & Co. "We've been making jeans for so long it's very easy for us now to get to a 10-minute jean with the automation of what we do."We've been able to pilot this in our own factories (in Poland and South Africa) and in the last two to three years we've reduced headcount by over 30%, producing the same units, as we've invested in more lean manufacturing, training and developing our workforce."Perhaps the biggest area of impact has been in laser finishing, he says, not only from a sustainability point of view by eliminating a lot of chemicals, but also by reducing cost too "because we're not paying for those chemicals. Waterless is also a huge thing for us; in our own factories, just on utility costs, we've reduced costs by 35% by being smarter."He adds: "We've been working very closely on sharing the knowledge on automation, lean manufacturing, finishing, to the point where two of our key strategic vendors can make in China for the same cost as we were making in Bangladesh and Pakistan on certain product."These deeper, stronger relationships with strategic vendors have also helped "develop into the cost that we need and to manufacture in the regions that we need. We have vendors today with multiple country of origins (China, Cambodia, Myanmar, Vietnam, Tanzania), so we can work with them to place the order and they decide where they make it for the markets that we need to maximise our speed to market."The partnership approach is going to be more critical; factories have got to have a lot more confidence if they're going to significantly invest in technology and automationClarks's Cranfield echoes his comments. "The partnership approach is going to be more critical; factories have got to have a lot more confidence if they're going to significantly invest in technology and automation and the capital investment that's required to support that...it's got to be a very sound, long-term relationship."Shifting skillsetsWhile it's all well and good talking about the use of technology to improve the efficiencies of apparel production processes and operations, it also requires changes to skillsets within supply chains."While we've got a lot of the hardware, what is still lacking a lot is the software – and in our industry the software is people," explains Shore."And I still see huge challenges where the colleges and universities are not really training the managers to make the decisions on what the right technology is. We're still short of professionally trained plant managers, industrial engineers who actually understand that technology; even coming down to the supervisors and the teams on the floor to manage it efficiently."Another element is "the people in our sourcing organisations are not technically driven; they have been trained to execute what somebody somewhere in Europe or the US is telling them to do, and they don't know the product or spend time in the factories," Descours laments."Because there is no industry left in Europe or the US, people driving the business from these countries have no clue what they are really buying, and the disconnect has led to a lot of silly decisions."So another challenge is to upgrade the talent we have in our organisations and bring them closer to product and factory knowledge. I'm pleased to see engineering is coming back; people with engineering backgrounds will be critical for our organisations."The skills gap is just as visible when it comes to more advanced digital technologies."One day we will go from a body scan to an avatar to having a piece of clothing that's made personally and delivered in a week; but it's not in the next five years," explains Janice Wang, CEO and co-founder of apparel industry consultancy Alvanon."And the reason is simple: because all the processes have to do with people, and the fact of the matter is we don't have enough trained people who actually understand the technology or know how the traditional method of making clothing actually works."So there's this big skills gap between how we've done things before and this basic knowledge, and this innovative technology that's out there. The kind of cross-collaboration that's needed in our industry in order to foster some kind of empathy between the production and the design side is for designers to work in a factory for three months. Somewhere along the way, we as an industry have forgotten that we need to educate people and bridge that gap."One company changing the way it works is TeamWorld, the purchasing office for the Eram Group of value fashion brands, which includes Eram, Tati and Bocage."Three years ago we were receiving 100% of the technical files from buyers or headquarters; today it's zero – which means that everything we offer is from here," explains managing director Brice Berrard."Our suppliers have been moving up the learning curve very fast, and those teams have understood exactly the needs of the market to offer what's of interest. Even for mass retail there is a need for change, and we're taking it."He says the company is also trialling a tool similar to the Twitter-like WeChat Chinese social media platform to help improve collaboration between designers, merchandisers and suppliers.Millennial mindsetThe use of technology doesn't just have an important role to play in improving efficiencies, though. It is also key to helping make the apparel and footwear industry an attractive workplace for millennials and give it an edge when it comes to competing with other sectors for their talent.While there has been a lot of focus on millennials – those born between 1980 and 2000 – as consumers, "they also represent the largest workforce that will be available," according to Andreas Kim, managing director for Greater China at technology specialist Lectra.Around 2bn millennials are already in, or entering, the workforce today – 86% of whom are in emerging countries: 30% in China, and 35% in Brazil and India.Cranfield adds: "We need to be employing millennials because they're the ones who understand the consumers." "As an industry we're not very good at revolution, we struggle with evolution. We should be re-engineering the product and the process driven by what the consumer demands," says Stuart Cranfield, global head of supplier working conditions at British-based shoe manufacturer and retailer C&J Clark International.

"We're still making shoes the same way; we haven't moved on, and we've got to change. We've got to look at materials, we've got to look at the sources, the technology. We've tinkered around the edges but haven't made fundamental change," he told delegates at last week's Prime Source Forum conference in Hong Kong.

"It doesn't matter what the duty is if we haven't got this part right." Colin Browne, president of global sourcing a US sportswear giant Under Armour, agrees. "We need to completely change the dynamic of how we think about this industry, and it's going to require us to not just think in straight lines. We're not going to start making products in America and running the same inventory control models; it's going to be a very different model. At this moment in time we're still operating like a relay race where we're passing things along the chain, where actually we don't need to be doing that any more "It's about partnership, and connecting with those few key partners who really understand our vision and also understand the values we're trying to propagate within our brands and within our businesses as well. At this moment in time we're still operating like a relay race where we're passing things along the chain, where actually we don't need to be doing that any more." The need for change, he believes, extends to the very definition of the sourcing role. "Sourcing implies we're going out exploring to find extra-cheap countries. How about product supply? Supply chain isn't right either...it suggests a series of events one after another; it's not a chain. Maybe a supply circle with the consumer in the middle. Or value-stream management." Automation and efficiencies Anne-Laure Descours, global director, development and sourcing apparel at sportswear specialist Puma, also emphasises the challenges facing today's apparel industry and its supply chain are "more complex than trade agreements." Restrictions are everywhere, she notes, citing the new French Duty of Care law (Le Devoir de Vigilance) covering human rights in global supply chains. She believes the need for transparency is also changing the game. "The partnership between buyers, brands and manufacturers of both garments and materials is critical because the whole chain collectively has to improve and do things better...and we have the tools around us that can make that possible." Another change in the manufacturing landscape is the move towards automation, she adds, citing one pilot factory in China where the entire process from fabric in to cutting is automated using robots. "Once you start to partner with suppliers and give them visibility of your long-term plan you also give them the potential to invest into efficiencies like automation and robotics. "In Puma's apparel business we have ten suppliers who do two-thirds of our sourcing. So when you have this level of partnership with state-of-the-art suppliers then you can really engage in a discussion about what is needed for your business and what is needed for their business and find the best way to get there. "Automation is a need from both a garment manufacturing and material sourcing perspective, and that's going to be one of the ways to gain speed, better planning and forecasting – and our industry has lacked investment in technology for a long time." Speed to market "Automation isn't new, but what has got better is the flexibility to maximise our speed to market," explains Vance Shore, head of sourcing at Levi Strauss & Co. "We've been making jeans for so long it's very easy for us now to get to a 10-minute jean with the automation of what we do. "We've been able to pilot this in our own factories (in Poland and South Africa) and in the last two to three years we've reduced headcount by over 30%, producing the same units, as we've invested in more lean manufacturing, training and developing our workforce." Perhaps the biggest area of impact has been in laser finishing, he says, not only from a sustainability point of view by eliminating a lot of chemicals, but also by reducing cost too "because we're not paying for those chemicals. Waterless is also a huge thing for us; in our own factories, just on utility costs, we've reduced costs by 35% by being smarter." He adds: "We've been working very closely on sharing the knowledge on automation, lean manufacturing, finishing, to the point where two of our key strategic vendors can make in China for the same cost as we were making in Bangladesh and Pakistan on certain product." These deeper, stronger relationships with strategic vendors have also helped "develop into the cost that we need and to manufacture in the regions that we need. We have vendors today with multiple country of origins (China, Cambodia, Myanmar, Vietnam, Tanzania), so we can work with them to place the order and they decide where they make it for the markets that we need to maximise our speed to market." The partnership approach is going to be more critical; factories have got to have a lot more confidence if they're going to significantly invest in technology and automation Clarks's Cranfield echoes his comments. "The partnership approach is going to be more critical; factories have got to have a lot more confidence if they're going to significantly invest in technology and automation and the capital investment that's required to support that...it's got to be a very sound, long-term relationship." Shifting skillsets While it's all well and good talking about the use of technology to improve the efficiencies of apparel production processes and operations, it also requires changes to skillsets within supply chains. "While we've got a lot of the hardware, what is still lacking a lot is the software – and in our industry the software is people," explains Shore. "And I still see huge challenges where the colleges and universities are not really training the managers to make the decisions on what the right technology is. We're still short of professionally trained plant managers, industrial engineers who actually understand that technology; even coming down to the supervisors and the teams on the floor to manage it efficiently." Another element is "the people in our sourcing organisations are not technically driven; they have been trained to execute what somebody somewhere in Europe or the US is telling them to do, and they don't know the product or spend time in the factories," Descours laments. "Because there is no industry left in Europe or the US, people driving the business from these countries have no clue what they are really buying, and the disconnect has led to a lot of silly decisions. "So another challenge is to upgrade the talent we have in our organisations and bring them closer to product and factory knowledge. I'm pleased to see engineering is coming back; people with engineering backgrounds will be critical for our organisations." The skills gap is just as visible when it comes to more advanced digital technologies. "One day we will go from a body scan to an avatar to having a piece of clothing that's made personally and delivered in a week; but it's not in the next five years," explains Janice Wang, CEO and co-founder of apparel industry consultancy Alvanon. "And the reason is simple: because all the processes have to do with people, and the fact of the matter is we don't have enough trained people who actually understand the technology or know how the traditional method of making clothing actually works. "So there's this big skills gap between how we've done things before and this basic knowledge, and this innovative technology that's out there. The kind of cross-collaboration that's needed in our industry in order to foster some kind of empathy between the production and the design side is for designers to work in a factory for three months. Somewhere along the way, we as an industry have forgotten that we need to educate people and bridge that gap." One company changing the way it works is TeamWorld, the purchasing office for the Eram Group of value fashion brands, which includes Eram, Tati and Bocage. "Three years ago we were receiving 100% of the technical files from buyers or headquarters; today it's zero – which means that everything we offer is from here," explains managing director Brice Berrard. "Our suppliers have been moving up the learning curve very fast, and those teams have understood exactly the needs of the market to offer what's of interest. Even for mass retail there is a need for change, and we're taking it." He says the company is also trialling a tool similar to the Twitter-like WeChat Chinese social media platform to help improve collaboration between designers, merchandisers and suppliers. Millennial mindset The use of technology doesn't just have an important role to play in improving efficiencies, though. It is also key to helping make the apparel and footwear industry an attractive workplace for millennials and give it an edge when it comes to competing with other sectors for their talent. While there has been a lot of focus on millennials – those born between 1980 and 2000 – as consumers, "they also represent the largest workforce that will be available," according to Andreas Kim, managing director for Greater China at technology specialist Lectra. Around 2bn millennials are already in, or entering, the workforce today – 86% of whom are in emerging countries: 30% in China, and 35% in Brazil and India. Cranfield adds: "We need to be employing millennials because they're the ones who understand the consumers."