One-piece fashion - Demand driven supply chain management
Licentiate thesis, 2009
The fashion market is characterised by short life cycles, low predictability, and high impulse purchasing. In order to respond to these characteristics, companies are constantly introducing new collections and models. There are now so many new models introduced that the seasons have been erased and the leader of fast fashion, Zara, introduces 211 new models each week. Not all of these garments are sold at full price—the sell-through factor in fashion, which indicates how many of the total SKUs are sold at full price, is approximately 65 percent. One of the reasons why so much must be sold at a reduced price is that the fashion companies might have created a new buying behaviour among their customers by offering everything quickly. This new buying behaviour cannot be answered with traditional supply-chain management.
Knit-on-Demand is a research project in the Swedish School of Textiles. The objective of the project is to demonstrate a production method for knitwear that may strongly influence the ability of the fashion industry to meet new demands for agility in customer relations. It will also provide insight and transparency in the total cost picture related to logistics and supply chain management, which leads to improved decision support in outsourcing and off-shoring strategies and may contribute to increased local fashion production. Knit-on-Demand differs from traditional garment manufacturing since nothing is produced to forecast and everything is produced to order from the end customer.
Together with Ivanhoe AB, a producer of knitwear, and SOMconcept, a tailored fashion retailer, the idea of on-demand knitting has developed into a business concept where the customer is allowed to design their own garments. The customer chooses his or her fit, colour and model, places an order, and one week later the garment is delivered. The customer is not completely free in his or her design because the quality and lead-times of the production processes have to be guaranteed. Therefore, the process is really more a configuration of pre-engineered modules.
The methods used are case studies with some action research as the researchers have taken an active role in the development of the project.
Mass customisation as a concept and on-demand business have great potential to decrease wasteful overproduction of garments and benefit the customer, company, and society: The customer receives a garment that better fits his or her needs, the company is able to meet customer demand more accurately, and society does not have to pay for overproduction.
Demand driven supply chain management
Demand chain management