Reshaping apparel sourcing

by Tom McGrenery (Content Lead)

If you are sourcing in the fashion industry, changes in technology and the structure of business relationships must be on your to-do list – or at least your ‘keep an eye out’ list – in 2021. A new report from market analysis firm GlobalData finds key trends that are reshaping apparel sourcing as the industry enters the new year.

Firstly, the issue of supply-chain resilience. The COVID-19 pandemic threw supply-chain vulnerabilities into sharp relief, and it is vital for sourcing professionals to learn from the experience and diversify their sources to avoid reliance on any one country, identify vulnerabilities to material shortages and have contingency plans. “Resilience has rarely featured in supply chain reviews, but companies must now build it into their operations if they want to avoid getting caught out in the future,” comments Leonie Barrie, Apparel Analyst at GlobalData and author of the report. In particular, the time is ripe to expand sourcing from India and Vietnam as restrictions start to come into force in major markets on fabrics and other products sourced from China.

“If there was ever a time to rebalance supply chains for greater responsiveness and flexibility, then it is now,” says Barrie. “Moving some production closer to market and shifting orders out of China is already underway, with Asian competitors such as Vietnam, Bangladesh and Cambodia picking up the slack.”

“COVID-19 has exposed the fragility of long-distance, international supply chains,” says supply-chain expert Mark Perera, CEO of Vizibl. To achieve the necessary resilience, Perea says organizations must create cross-functional or cross border teams to deal with supply chain shortages, build additional buffers of inventory and raw materials, develop expected-case and worst-case scenarios, examine additional delivery routes and potential local sources, and explore technologies that can help them to diversify and innovate throughout their supply chain.

Another key issue is trust and reliability – always emphasized by Global Sources, there is no substitute for finding a reliable supplier who is willing to build a dependable, transparent partnership. The breakdown in many supply chains in 2020 showed the danger of fragile business relationships. “The loss of trust between buyers and suppliers – through order cancellations, broken contracts and withheld payments – was one of the first casualties of the pandemic and is rewriting the rules on buyer-supplier relationships. A move towards deeper partnerships that bring greater agility and accountability will help avoid a repeat of the pain and financial loss many suffered in 2020,” writes Barrie.

Finally, technology will enable sourcing professionals in all fields to work more efficiently, and give a competitive edge to those whose rivals don’t take advantage of the new tech. In apparel, 3D modelling, digital sampling and virtual showrooms have game-changing potential.

Finally, end-to-end visibility may be the biggest trend to emerge in 2021 for apparel sourcing, tracking materials and products all the way from cotton fields to store shelves. Driven by rising consumer demand for accountability on social and environmental issues, as well as the boons to efficiency and cost, tools under development include blockchain and DNA tagging.

Barrie notes: “Early adopters of end-to-end visibility tools will be best-placed to provide consumers with more information on the products they purchase, as well as satisfy regulators and investors who are increasingly concerned about being exposed to unethical practices, legal risks and reputational damage.”