Time squeezed out of the supply chain means more time and resources your company can devote to objectives of your choice.
Perhaps you would choose to add this valuable time to the front end, to creating and designing your products? Or maybe you would like to give yourself more room farther down the chain, so that you can make split-second line changes on a dime to respond to market trends?
Apparel has identified these 10 segments of the apparel supply chain where you can improve your visibility and thus lower costs, speed product and improve your overall decision-making abilities.
The apparel supply chain really begins at the point of creative spark inside the designer's mind. While it may not be possible to capture these inchoate musings in a file, you can come pretty close with product data management (PDM) or product lifecycle management (PLM) solutions that allow users to save and manage ideas, materials and product data in one place that provides visibility into the process for everyone involved. With PDM/PLM, companies can streamline, automate and maintain one version of the truth for a broad range of pre-production processes. There are software solutions for concept/design development and collaboration that capture designs and ideas digitally and store them in one place that can be accessed by multiple parties and built upon. Other tools enable specification management, acting as databases for style data, grading rules and measurements, and providing a mechanism for communicating this data via the Internet to contractors. Yet other packages focus on streamlining the sample-making process, tracking sample fabric orders, fabric inventory and fit sessions. And a core element of most PDM/PLM solutions is functionality for workflow and line calendar management. Some players in this space include: Gerber, Lectra, Freeborders, Porini, Assyst, Computer Generated Solutions (CGS), Business Management Systems (BMS), PTC, MatrixOne, New Generation Computing (NGC), GEAC and Intentia.
It overlaps with product development, but deserves its own category. Clear protocols, improved calibration methods, engineered color standards and new software solutions from companies such as Datacolor, She-Lyn/GretagMacBeth, Color Solutions International, Archroma/Clariant and eWarna can go a long way toward eliminating the time and expense of sending multiple lab dip "submits" across the oceans via courier and provide a company with greater visibility into its color supply chain. Opting for "science" over "art," many companies are improving visibility and speeding time to market by basing decisions on spectral data sent via Internet - even if they do demand a physical swatch for final approval. Members of the American Association of Textile Chemists and Colorists (AATCC), such as Sears, Target and May Merchandising, have been at the forefront of developing best practices for color management. At Sears, for example, physical swatches, visual evaluations, subjective communications and Excel spreadsheets are being supplanted by digital standards and communication. The retailer is doing spectral evaluations of submits, and saving results in a database that can be tracked with reporting tools. These color management initiatives have shortened Sears' timeline considerably, says Rebecca Leu, director of CAD, color and packaging. "Visual evaluation is still necessary, and tracking is still cumbersome," she adds, but progress is ongoing. Sears' goal is to increase its use of virtual evaluation tools and procedures, Web-based communication and color standard reflectance data.
Where's my stuff? It's a question that, unfortunately, is asked too often in the apparel industry, but with the apparel supply chain increasingly fragmented among multiple manufacturing and consolidation points, keeping track of product can be a major problem. Solutions for tracking products from the factory to the retail warehouse - whether in-house or through third-party logistics (3PL) providers such as Crowley Logistics, Federal Express, UPS, Maersk and Seaboard Marine - are giving apparel companies new insight into their supply lines and the ability to change direction on a dime. This can be particularly beneficial if you are trying to track different items for the same collection or ensemble, coming from different countries. 3PLs can streamline the supply chain in other ways, says Don Moscoe, CEO of the online sportswear and equipment retailer BoardZone. His Toronto-based company had some unique difficulties arising from its high volume of sales to the United States. To begin with, BoardZone, based in Canada, couldn't get U.S. quota to import its snowboard jackets. Secondly, the company had to pay a $25 brokerage fee for each package shipped across the border. BoardZone enlisted the help of UPS, which solved both problems. Now the company can buy direct and have its jackets shipped straight to a U.S.-based UPS warehouse, avoiding quota problems. As for the brokerage fee, UPS now consolidates 40 to 50 orders in one shipment, so the $25 is spread over many orders, instead of one. Finally, Moscoe notes one other interesting benefit: Supply chain invisibility. With the solutions from UPS, the consumer is ultimately unaware of where his goods originate, and does not have to worry about the hassle of having product shipped internationally.
These days, it's difficult to separate sourcing from logistics, but we'll give it a go. We're talking here about that front-end process of sourcing: requests for quotes (RFQs), specification management, time and action calendars and everything else involved in negotiating a contract with a factory and getting the right product manufactured and to the shipping dock in a timely fashion. "Probably one of the biggest problems and probably one of the biggest reasons CIOs don't sleep at night is the supply chain," says Ed DeMartino, vice president and CIO of The Children's Place. Having identified four "pain points" within its organization: 1) the purchase order management process; 2) pipeline visibility; 3) information collaboration with trading partners; and 4) financial invoice processing, the company recently started implementation of the SteppingStones sourcing solution from TradeStone to address these actions. DeMartino says SteppingStones is a best-of-breed solution that is simple, flexible and can be distributed to trading partners "without having to do an enormous amount of training and processing." It also met the company's need for a Java WebSphere (IBM) platform, on which its style-development system was built. "Pipeline visibility is a very critical piece for us," says DeMartino. The Children's Place often experiences "black holes" within the sourcing process where it loses visibility to its product, he says, adding that the company needs to improve communication with its trading partners so it can have visibility to the product through the entire process, "from the inception of the merchandise to its being staged to go via water to get into the country." Knowing where it is in the process will give The Children's Place more decision-making power to best service its stores, says DeMartino.
Sometimes the smallest things can cause the biggest problems. "If you go through customs and your label is wrong, customs can stop your whole shipment," says Paul Chamandy, vice president of new business development at Paxar. Indeed, those little labels carry a lot of weight. Product labels must convey ever-increasing amounts of information in multiple languages, including care instructions, country of origin, vendor and style numbers, UPC numbers, carton contents and more. Missing or incorrect labels can wreak major havoc, causing shipment delays and other problems. Solutions from product identification giants such as Avery Dennison, Checkpoint Systems, Paxar and Shore To Shore can provide companies with visibility into this crucial part of the supply chain by allowing you to control the data that's printed thousands of miles away, from your desktop at corporate headquarters. At Nike, for example, Avery Dennison's InfoChain Express has improved the accuracy and reliability of Nike's purchase order (PO) process, according to Steve Hills, manufacturing logistics manager of global apparel sourcing. Nike uses the solution on the factory floor to print its UCC 128 carton labels, which describe the contents of cartons of shoes or apparel. "We've gone from a situation where we used hard-copy documents that gave us a point-in-time set of data to pass to our factories, [to now] having a more real-time document, and a more automated process at the factory floor," he says.
Call it the payment paper trail. The endless mire of letters of credit, orders, invoices and payments traditionally involves a lot of paper pushing and reconciling. Lengthy processing time involves many non-value-added tasks, and late payment can damage relations with supply chain partners. And of course there are significant document-handling costs. (The charges of preparing documents for one transaction can total in the hundreds of dollars.) But help is on the way: Automating the financial supply chain "connects buyers, sellers and their service partners on a hosted, paperless platform with integrated financial services that results in visible processes, decreased costs, improved cash flows and streamlined operations," says Kurt Cavano, CEO of TradeCard.
If you're still managing your business by fax and by phone, it's time to enter the 21st century. These are processes that add no value, waste time, create mistakes and redundancies and are completely inefficient, no matter where they're performed along the supply -or demand - chain. Order entry is no exception. In the olden days, a retailer would fax or call a manufacturer and relay an order over the phone, while the representative on the other end scrambled to write it all down, and then re-entered it into a computer system. Retailers had no insight into their supply chain, and had to rely on a human presence on the other end to take orders, answer questions and track problems. With the advent of the Web, manual processes can be increasingly automated, such as with CenterStone's Buyer's Page, which is designed to enable retailers to order online, 24/7, from manufacturers that have implemented the solution. Buyer's Page also provides visibility into a database of inventory, pricing and product information, including order status, says Tom Detmer, president and CEO. On the manufacturing side, the benefits are "incredible" as well, says Alison Smith, director of operations for Marmot Mountain, a manufacturer of outdoor sportswear and equipment (with three of its own retail stores). Marmot receives orders via Buyer's Page from scads of single-door specialty retailers, she says. Buyer's Page has eliminated the "middleman," interfacing Marmot's back-end order entry system directly with the retail customer. "A retailer logs in, enters their order, it comes to us, we look it over and push a button to submit it to our system," she says. For both parties, the paper trail is eliminated, accuracy is improved and time and money are saved, all while giving improved visibility into the retailer's pipeline.
What merchandise do you have? Where is it, and where is it going? Simple questions, but if you don't have a handle on this constantly changing information, you can start bleeding financially from expenses that add up because you are not able to track your goods. This is what was happening at Coolwear, a popular apparel brand sold in stores such as Sears, JCPenney, Macy's, Nordstrom and Bloomingdale's. The firm also does private label manufacturing for many of these same department stores' lines, such as Sears' Canyon River Blues. Adam Eisenstadt, chief of technology, says that Coolwear had no "peripheral vision" into its business - "no visibility whatsoever into import tracking, work-in-process, inventory, raw materials inventory - nothing." It needed the ability to ship its product on time, in the right boxes, with the right labels, and know what it had and where. It needed to fix problems such as this: "If JCPenney orders 1,000 of an item, and it gets sent to one of our distribution facilities in Miami . and for whatever reason they decide that they can only take 500, and we have 500 pieces lying there, those items sit there, and don't get resold most of the time," Eisenstadt relates. To improve visibility into its inventory management - and frankly, into its entire supply chain - Coolwear implemented Computer Generated Solutions' BlueCherry solution to "unify all of [its] systems," says Eisenstadt. Among other things, the system will provide raw material and finished goods tracking, work-in-process and production information. Its small-package shipping system will integrate directly with FedEx and UPS. Eisenstadt says BlueCherry will replace Coolwear's "extraordinary" spreadsheets, bringing everything into one central application. "It's going to do all of our EDI and bring it directly into the application," says Eisenstadt, who notes that there are 5,000 reporting fields in the system, which can be dragged and dropped, simply, in any order and amount, to create relevant reports for management.
Twin sibling to inventory management. It's crucial to know what's in inventory, and apparel firms and retailers also must be able to harness that information to move merchandise through the warehouse and to stores quickly and efficiently. In fact, some retailers are getting a leg up on the warehousing process by skipping over it altogether - shipping merchandise direct-to-store from the factory. A wealth of software and technology solutions from the likes of Manhattan Associates, Real Time Integration Inc., AL Systems, Foxfire Technologies, GEAC, Logility, SAP and Network Systems International - just to name a few - are designed to give a company greater visibility into its supply chain by automating and networking processes such as cross-docking, material handling, picking and packing, returns and damages control and shipping. But the biggest news in warehousing these days? You guessed it - RFID. With announcements by major retailers METRO, Wal-Mart and Target that they will implement RFID tagging at the pallet and case level with their respective top 100 suppliers in the coming year, the technology has become top of mind for most large retailers. RFID systems consist of tags (chips that contain identification and often other data) and reading devices that convey that information from the tags to computer systems. At the warehouse level, companies can quickly and cost-effectively track large amounts of merchandise when tagged cases pass by the RFID readers, eliminating the need for hand-held scanning of individual bar codes. While conversion to RFID systems is a costly undertaking, Lee Scott, CEO of Wal-Mart, remarks: "In the long term, [RFID] will provide benefits for all of us."
You want me to eat what? Sometimes one of the best ways to gain insight and visibility into your supply chain is by understanding the culture of the different stops along the way. This means knowing or defining your own corporate and brand culture, and understanding that of other apparel businesses, especially your brand's licensees. For instance, if you are a retailer, it's important to have insight into the lifestyle image national brands are projecting. If you know you are carrying a popular urban brand that appeals to readers of hip-hop music magazines, for example, you won't want to position it next to Lilly Pulitzer in better women's, right? Cultural connectivity also means keeping abreast of geo-political developments and cultural differences in the countries where you produce your goods. For instance, are you trying to negotiate terms with a Chinese factory? Don't refuse the chicken feet - a Chinese delicacy - offered during lunch. It can also mean following and acting upon demographic shifts. Maybe much of your distribution is in Hispanic areas - how can you capitalize on that? One good way to keep your finger on the pulse is to become active with industry associations, such as the American Apparel and Footwear Association (AAFA), the National Retail Federation (NRF), the American Apparel Producers' Network (AAPN) and SEAMS. In addition to offering networking opportunities, these groups, and others such as the Voluntary Interindustry Commerce Standards (VICS) Association and the Retail Industry Leaders Association (RILA), often conduct studies and report on best practices in supply chain management.
The bottom line: Collaborate with your supply chain partners on many levels so that they become integral to the success of your business, not separate, far-removed links. The world is your oyster; so don't just focus on the pearl!
JORDAN K. SPEER is senior editor of apparel. She can be reached at [email protected].