Snapshot: Top Take Aways from FASHCON
The Shifts that are Shaking Up the Apparel Industry
Changing times require new solutions. Sourcing executives at FASHCON (Hong Kong, Aug 29) met to learn about the newest developments in sustainability, new opportunities for ASEAN sourcing, as well as innovative ways to rethink a company’s organization structure.
"I found FASHCON really well organized, informative, with all content of great value and relevant to our current situation in the industry, said Marco Stefanelli fom Stella Blu.
"All content was excellent, very well documented and explained," said Jorgen Sevild from Inqova.
The 'new organization' needs not only to support greater efficiency, but also to provide a more satisfying work-life experience for employees. As smart companies have learned, an employee who is happy and feels fulfilled by their work is more productive and tend to stay with the company longer.
The shifts that are shaking up the industry also include a new consumer mindset, as well as fast growth in emerging markets (Asia markets mean big business!). Consumers in the traditional markets are shopping slowly and more mindfully. That’s pushing brands to invest more heavily in new markets (ASEAN, India).
Then there’s China’s massive e-commerce market. In this hypercompetitive market, only the most astute marketers will succeed. Those are almost always the brands or platforms that are able to build a close, personal connection with their customers.
Here’s a snapshot of key ideas from FASHCON:
- Sustainability remains a huge challenge for all but a handful of niche brands. Most are struggling to find a way to achieve greater sustainability without making major tradeoffs on price or product appeal. Using more sustainable fiber is the most practical solution for most brands and manufacturers.
- A few industry leaders are making real progress in eliminating plastic from their supply chains. To be successful this requires buy-in from both the brand and suppliers. The higher cost of sustainable packing materials needs to be offset in other areas.
- US cotton is making a tangible contribution to more sustainable fashion due to its high level of consistency (less waste). US cotton is also working with Oritain to identify and track the original ‘fingerprint’ of cotton products – which will help prove the origin of where the cotton has been grown.
- Supporting the demand for greater sustainability and traceability, US cotton has launched its new Trust Protocol. This will provide third-party verification of key data and measurements – from soil health and water usage to quality and even worker fairness. Phase One of the protocols will include the 2019 crop and be implemented with the 2020 crop. Through technological advancements, US cotton growers have been able to reduce the amount of land they use, while at the same time increasing cotton output.
- Biodegradable poly bags are becoming a viable supply chain option. The key is managing inventory since they have a shorter shelf life than standard poly bags.
- Micro fibers are a mega environmental problem – in the ocean, wastewater and soil (landfill). One practical solution is a new additive from Intrinsic Textiles Group that when added to polyester can help to boost biodegrading in landfill nearly as fast as wool.
Optimizing Organizational Efficiency
- Rethinking your organizational structure to reduce a top-heavy hierarchy can significantly speed up your supply chain.
- New model – from top-down management to a more collaborative approach. Turning your employees into a ‘team of experts’ who can take on end-to-end responsibility.
- Create a framework for autonomy. This enables everyone more room for personal growth and development.
- It’s not about whether to diversify sourcing, it’s about where to place production. It’s a juggling act between cost, speed, and reliability.
- Legacy ASEAN nations are getting serious attention as brands worry that Vietnam is near capacity.
- Malaysia is attracting new interest for being stable, having an experienced workforce, and benefitting from intra-Asia trade agreements.
- As sourcing becomes more complex, more buying offices are turning to 3P (Third Party) or outside service providers for added support. Building strong relationships with these service providers is providing brands with more service support, but without having the burden of hiring more staff.
- The growing need to rethink trade routes. Before everything was East-to-West. However the growth of Asia’s consumer markets is making West-to-East trade increasingly important.
Retail & The New Consumer
- ASEAN consumer markets have a combined population of over 650 million people. International brands are starting to get serious about selling into the region.
- China offers huge market potential, however it is not one homogeneous market. It’s all about being able to connect on a niche level.
- Consumer mindsets are shifting – away from ‘consumption for the sake of consumption’. Today’s shoppers get as much satisfaction from ‘searching’ as from buying.
- Consumers understand a lot more about quality than many brands realize.
- Quality is now expected. Regardless of price, no one wants cheaply made products.
- The growth of e-commerce is driving the demand for faster, more flexible logistics. Customer satisfaction is heavily tied in to the ability to deliver orders quickly and cheaply.
- Cloud-based logistics are helping to provide connected end-to-end supply chain platforms. This is supporting more controlled customs clearance, better last-mile delivery, and the ability to work with various third party (3P) payment gateways.