Supply Chain Risk Management for Fast Fashion

  • Written by Peter Needle
  • Published on 11 October 2018
  • Our Voice

When it comes to the fast fashion industry, the level of supply chain risk can be monumentally high. What’s more alarming is that some brands and retailers still rely on teams of employees to ring individual suppliers around the globe to chase complex production processes and find out where orders are. Sometimes it seems staggering that any garments actually make it onto a shop floor!

Here are some of the most common problems in the fast fashion supply chains, as well as potential solutions offered by supply chain risk management tools.

RUNNING LATE

Late deliveries are one of the biggest supply chain risks in the fast fashion industry, and can result in increased transport costs if retailers are forced to use air freight as opposed to the much cheaper option of sea freight.

In the worst possible scenario, brands can suffer huge losses as a result of missed sales opportunities. Fast fashion trends last for weeks rather than months, so every minute counts towards a retailer’s overall profits.

Segura’s software makes it possible to monitor and manage a garment retailer’s secondary supply chain of trims and packaging. By building a complete audit trail, brands can trace orders back to the production line, identifying the cause of any delays and addressing future supply chain risks.

Many garment retailers will already have ERP and PLM systems in place to manage fast-paced supply chain operations, so we’ve also built a full EDI transactional layer into Segura’s architecture. This means that supply chains can be managed as usual while data is fed directly into Segura’s platform, avoiding the need for any downtime.

MINIMISING MANPOWER

Theoretically, fashion brands could improve supply chain transparency by placing an employee in every factory it works with, keeping a close eye on every sourcing location. However, this would likely be prohibitively expensive, or demand a big supply chain downsize to make it possible. Most brands have little choice but to invest in supply chain risk management technology instead.

With Segura, there is no need for teams of people to manually check up on orders, as our software can alert the brand in real time if any orders are delayed. Companies can also find out where an order is in the production process simply by searching for the purchase order number.

As a result, brands rarely need to get involved in discussions about product quality or order information. Disputes between suppliers can be handled directly through the software, which keeps a full audit trail that can be used as evidence.

EXCELLING IN ETHICS

Technology can also help garment retailers meet ethical objectives. Under Part 6, Section 54 of the Modern Slavery Act, UK businesses are now required to report on their actions to detect and deter slavery from their supply chains. In partnership with a good audit process, Segura can take care of the requirements that retailers must meet under this section of the act.

Technology will also have a huge impact on the consumer experience in future, influencing the role of supply chain ethics. It may soon be possible to access a wealth of information on any item of clothing online and in store through interactive screens and activated mobile content. This will make it more important than ever for retailers to know where their products came from.

Imagine having the visibility to see exactly where a garment’s zips, buttons and packaging came from, and each factory’s latest audit rating. Consumers could purchase items knowing that they were ethically produced, having been given all the necessary information by the retailer - made possible by Segura.

Originally Published 20/07/2015

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