The fashion & lifestyle industry is one of the largest and most challenging ones, witnessing frequent disruptions. The year 2020 highlighted the struggles brands are faced with, making it critical for them to adapt and discover versatile processes that can redefine their supply chains beyond 2021.

The current demands of e-commerce, along with a retail landscape reshaped by the pandemic, has presented problems for many brands. Consumers now have higher expectations as they want an experience that’s beyond the realm of a simple purchase transaction. Similarly, carriers, shippers, managers and the like will demand a better customer experience.

Fashion retailers need to deliver personalised engagement at every stage of the customer journey — from the moment of inspiration to product discovery, brand engagement, sales conversion, fulfilment and returns.

This has led to a marriage of the digital and physical worlds creating wholly new sources of value, with brands realising that they need the right strategy to succeed in this environment. This is the omnichannel imperative.

In addition to this, there are uncertainties around novel capsule collaborations, new product trends and international trade that can swiftly destabilise trusted supplier relationships. In such times, managing consumer expectations, product quality, inventory volume and fashion supplier relationships requires the flexibility coordination, and balance of an innovative and modern fashion & lifestyle supply chain.

We are unsure how long this disruptive landscape will last — the right approach is to expect these challenges to continue and be prepared for them.

How does transforming to a modern supply chain help?

How does transforming to a modern supply chain help?

Traditional supply chain strategies have often focused on operational efficiency. When operational efficiency is the priority, a firm strives to squeeze as much cost out of the supply chain as possible, and that goal drives supplier selection, manufacturing strategies, product design and distribution and logistics. Typically, production and distribution decisions are based on long-term forecasts, inventories of finished goods are located close to customer demand, and components are often sourced from low-cost countries.

A modern fashion & lifestyle supply chain allows for a hybrid framework — it strikes a balance between efficiency and responsiveness. With responsiveness comes agility and flexibility that are vital to meet the needs of a company and its customers. This allows businesses to satisfy demands quickly and eliminate stock-outs. Manufacturing or product assembly is based on real-time data rather than forecasts. Products may be customised, inventories of components can be maximised, while that of finished goods are minimised, and speed is prioritised.

Striking that perfect balance between peaks and lulls in demand is essential. Better responsiveness paves the path for a resilient supply chain by helping companies meet their customers’ changing demands for shorter lead times, customised products and a robust e-commerce presence. This strategic approach is the lynchpin for an end-to-end integrated supply chain that makes fashion & lifestyle brands resilient to industry-wide disruptions.

To stay competitive, supply chain leaders need end-to-end planning from alternative routes and locations to having inventory closer to origin or destination is critical. For this to happen effectively, you need a strategic partnership with your supply chain partners.

Benefits of this hybrid framework

When executed well, the framework will lead to lower supply chain costs and higher revenue because of fewer stock-outs and improved service levels (the proportion of orders delivered on time and in full). Additionally, the hybrid framework will enable companies to build resilience and increase customer retention.

The benefits of this hybrid framework

Resilience playbook or resilience planning will ultimately allow businesses a better chance of withstanding the shocks to their supply chains.

The hallmark of a modern integrated supply chain is that it has specifically designed aspects that stay multi-faceted without compromising on efficiency. This makes it possible to take informed decisions when problems arise and find ways to establish and maintain an edge over the competition. An effective omnichannel strategy gives lifestyle brands a significant opportunity while they seek to engage with an ever-evolving customer base.

How to make this transformation possible?

How to make this transformation possible?

The assumption is that modernising a major corporation’s supply chain costs tens of millions of dollars and requires a monumental three-to five-year transformation effort.

However, companies have witnessed higher revenue and customer retention with a faster, simpler and cheaper approach. It involves breaking down the walls between functional areas and creating an integrated supply chain that provides a competitive advantage.

A modern integrated supply chain is the foundation of the future of fashion & lifestyle brands in 2021 and beyond. Stay future-ready.

Be prepared for your upcoming moves with our next article on 'Transforming direct-to-consumer supply chains'.

Josue Alzamora
Josue Alzamora
Global Head of Lifestyle Vertical, A.P.Moller - Maersk

Anything you need, we’re here to help







Industry Insights

Sign up to our newsletter

To provide you with the right tools and the most relevant information for you to best manage your supply chain, please sign-up to our bi-weekly newsletter on global logistics.