Fast food, fast internet, fast coffee … it seems everything needs to be delivered to us fast these days. We’re moving into an age where everything is driven by speed, and the Rag trade is feeling the pressure to deliver ‘Fast Fashion’ more than ever. With tech-savvy Millennials and time-poor consumers searching for more convenient ways to get what they want, when they want it, Speed to Market (STM) has become so important that Cost has become a secondary consideration.
Overseas trends and fashions can be found at the push of a button and consumers want access to those latest colours tomorrow. If you don’t have it, then they’ll walk across to the next pop-up shop that does, or indeed open a new browser window and hit search again.
The ability for retailers to deliver Fast Fashion can be challenging in the least and nigh on impossible to those who don’t have a supply chain that can support speed to market.
…but the Need for Speed has many roadblocks
Trends used to follow two seasons: Spring/Summer and Fall/Winter. Now they change weekly, with as many as 52 ‘micro-seasons’ per year. Anticipating ever-changing demand and ensuring the latest colours, designs and accessories are moved at the right time can be a logistical nightmare.
There are many challenges to STM – missed deliveries from down the supply chain, delays at the manufacturer, international trade issues and mother nature can all contribute to delays into store.
Different modes of transport have their own merits. Sea freight is obviously the most cost-effective, but doesn’t cut it if you need something in store next week.
The cost of Airfreight used to be a roadblock for retailers but with the increasing importance of ‘product availability’, it is now a critical factor to achieving success in the TCF sector.
Be slow at your peril…
The old adage ‘slow and steady wins the race’ no longer applies. The implications of being slow to market can range from missing just a few sales to risking a significant slice of your market share if your competitors are faster than you.
Your business could be impacted by missed deadlines for in-store sales or catalogue promotions where the retailer might impose a penalty, not to mention increased inventory management costs. Stock-outs, redundant products in storage and reduced margins due to discounting, and the pressure that puts on current regular priced stock are all risks to your bottom line.
What damage would your brand suffer if these things happened?
Your competitive advantage hinges on how well you manage the logistics of putting your product in your customers’ hands at the right time. And that time is when they are ready to buy, not when your ship comes in!
Is Speed to Market an opportunity or a risk?
According to the FBIC Group, STM is a critical component to competitive advantage. If Australian retailers can act on consumer demand to deliver ‘now’, in an industry that is worth A$21 billion and growing, there is a huge opportunity for the sector, right?
However, if you don’t get the logistics mix working and you fail to respond to the demand of the fickle fashionista, you risk losing it all.
Airfreight is the obvious answer to getting your product into your customer’s hands fast, but with so many variables, this mode is extremely complex.
If you have knowledge gaps around packaging requirements, supplier terms, freight services and transport modes, your Air journey is going to get bumpy. That’s not even considering the kilometres of red tape that is wrapped around your cargo in customs and compliance paperwork.
Preparing paperwork, clearing the shipment, breaking it down and then transporting it to the warehouse can sometimes take longer than the flight itself! Partnering with someone who knows how to detour around the roadblocks is critical to your success!
The Roadmap to Speed to Market
A number of studies have examined the Speed to Market trend and suggested some criteria for retail success. IBIS World identified three key factors for the fashion industry, of which the ability to control stock on hand was one. While this is primarily inventory management, the critical link to stock control is consistency and predictability in your freight management.
The Fung Business Intel Centre says that the ability to react and respond to changing trends is another critical factor for retailers globally. This means being able to set ambitious turnaround times for shipments and meeting them consistently to ensure your product walks out of the store instead of sitting in a warehouse.
The road to STM is not a straight line. You need a tailored approach with a partner who is nimble and can assess your business’ needs in relation to your supply chain, ports of origin and destination requirements. They should have a strong team with deep experience in your industry as well as intimate knowledge of the fastest way to get your product from A to B… and that’s not on a slow boat from China!
Most importantly, you need a partner who can deliver speed, but at a price point that won’t erode your margin.
We’ll be sharing some examples on how Australian retailers have used a partner to navigate their own roadblocks soon, but to find out more about how you can deliver Fast Fashion now, contact our team on 1300 651 888 or email us at email@example.com
IBIS World (subscription): click here for the full article
Fung Business Intel Center: click here for the full article