Intentia: Stepping Out With Fashion and Style Part Two: Software Challenges in the Fashion Industry

Introduction

The requirements for the fashion industry are some of the most demanding and unforgiving in the world of manufacturing. If you're not careful, you may find your profits falling on the cutting floor and money being swept out with the scraps. The product segmentation in the fashion industry brings into play every type of manufacturing scenario imaginable.

We are surrounded by fashion. In fact we come into contact with it so often that we tend to take it for granted. However, if you are in the business of fashion, you know that people's tastes are extremely fickle and ever changing. Your enterprise-wide software has to be nimble enough to turn on a dime. It also must be able to anticipate more often than to simply react.

This research note explores industry characteristics and trends, as well as resulting software challenges. After getting an understanding of the fashion marketplace and competition, we will look at Intentia's Movex software offering. Movex's functions and features that will allow you to cut, sew, and package your products efficiently before they are out of fashion.

And, while you may not be into haute couture or consider yourself a fashion plate, you may find how the fashion world solves problems similar to those found in your industry. For sure, you will have a better appreciation of what it takes to put that shirt or skirt on the shelves and not so quick to say it costs too much.

This is Part Two of a three-part note.

Part One discusses the characteristics and trends in the fashion industry.

Parts Three and Four review some of the significant functions and features offered by Intentia's Movex software for the fashion industry.

Software Challenges

So, what do challenges such as shortened time to market, reduced lead times, delivery performance, and frequent changes in customer demand place on enterprise-wide software? In the fashion industry product segmentations are many and frequent. Products tend to cater to the whims of the consumer and try to be all things to all people. Consequently, products are typically categorized by fashion lines. These lines are referred to as collections and appear multiple times per year, up to weekly. They are often one-shot events, implying a single buy of raw materials with small or no replenishments anticipated. Products aligned along fashion lines rely on retailer forecasts or best guesstimates under a make-to-order scenario, again with no repeat orders anticipated. Under the fashion line segmentation product setup, scheduling, and execution must be quick. It's not a case of "He who hesitates is lost." It's more a case of "He who hesitates never sees his product on a retailer's shelf."

Another type of product segmentation is seasonal, which places additional requirements on the software application. Seasonal items can also encompass some of the fashion line considerations discussed above. With some slight variations, styles of some seasonal items can span, in fact, several seasons. A popular summer shirt can be carried into the fall season by adding long sleeves. However, typically the product life cycle of a seasonal item is between three and six months. Follow-on orders will depend on initial sales. Under the seasonal segmentation software must be able to handle one-time products that may grow into repeat orders or can be easily modified to accommodate additional seasons. Dealing with the latter requirement can be accomplished with the ability to copy or combine a bill of material or formula with substitutions and modifications.

The last type of product segmentation is what is more commonly found in a stable manufacturing setting. This segmentation is the replenishment, never-out-stock (NOS) product lines. These include the men's white shirt; the women's black dress; the basic men's Oxford shoe; and women's black, mid-heel pump. These products have an extended product life. Of course, NOS products often undergo aesthetic changes in a two to three year period. However, such changes usually do not require major adjustments to the production lines and setups. This segmentation is as close as you can come to make-to-stock in the fashion industry.

The product segmentation in the fashion industry brings into play every type of manufacturing scenario imaginable. One-time orders are typical to those in the specialty chemical industry. The no-carb craze currently taking over in the food industry, which has lasted six months but is near its end, will surely have fallout products in the checkout lines. The V6 engine block will always be in the majority of cars. In the fashion industry, software must be able to handle any one or all of these scenarios.

More Software Challenges

But the software challenges do not stop here. In fashion people think in terms of style, color, size, and fabric—not items. However, inventory records are maintained at the item level. The translation between these views must be transparent and simultaneous. When customers call to place an order, they are likely to say, "Give me a dozen blue pleated skirts in medium." However, when picking the order, the pick list will direct the warehouseman to go to location G120 and pick twelve of item 324B.

The software must be able to generate and handle an inordinate large number of stock keeping units (SKU). A man's button-down, long sleeve, Oxford shirt that comes in five colors could easily generate 300 distinct, pickable items (shirt x color x collar size x sleeve length). When you add such variations as plain collars, Egyptian cotton fabric, and French cuffs, the number of items expands geometrically and, even for very small suppliers, can easily exceed several thousands. And who said that women were the fashion plates of the species? A corollary to this challenge is that orders tend to be huge in terms of line entries and numbers.

Being at the beck and call and within easy reach of the consumers, the software must be able to accommodate and service a large number of stores, be it their own or those of a retailer. The only constant in the fashion industry is change, namely nothing stays the same. When compounded by the short life cycles of products, even shorter lead times for materials, and extended and complex supply chains, software catering to the fashion industry must be adaptive and serve to the needs of a three-headed master: suppliers, retailers, and consumers.

For software developers these challenges translate into features that must be incorporated in the design of the enterprise application. A common feature is the generation of item numbers based on a standard distribution of size and color ratios. For example, men and women shirts are sold in standard size and color combinations. To handle the challenge of the large number of SKUs a typical software feature is to automatically generate item master entries for this standard distribution. Figure 1 below translates this and other challenges into common features that must be included in the software design of any respectable application for the fashion industry.

The explanation of these challenges may appear somewhat simplistic. Their application and usage, on the other hand, is very complex. How one vendor, Intentia, addresses these and other challenges is the subject matter for Part Three of this research note.

This concludes Part Two of a three-part note.

Part One discusses the characteristics and trends facing the fashion industry.

Parts Three and Four review some of the significant functions and features offered by Intentia's Movex software for the fashion industry.

About the Author

Joseph J. Strub has extensive experience as a manager and senior consultant in planning and executing ERP projects for manufacturing and distribution systems for large to medium-size companies in the retail, food & beverage, chemical, and CPG process industries. Additionally, Mr. Strub was a consultant and information systems auditor with PricewaterhouseCoopers and an applications development and support manager for Fortune 100 companies.

He can be reached at JoeStrub@writecompanyplus.com.