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Management and Marketing in the Fashion Industry Sample Essay

‘Electronic commercialism and the Internet are basically altering the nature of supply ironss. and redefining how consumers learn about. select. purchase. and usage merchandises and services’ ( Sreenivas. 2007 )

Harmonizing to Barnes and Lea-Greenwood ( 2006 ) and Berger ( n. vitamin D ) . mass-communication has allowed consumers greater entree to information and accordingly the public presentation spread between companies can no longer be hidden. With the debut of e-commerce. how consumers behave and what they demand has changed. Mintel ( 2011 ) reported that over 55 % of all Internet users research merchandises via the Web before doing a purchase either in-store or online. With so much information at manus. consumers have become more demanding. Their willingness to wait to be satisfied has been reduced and instant merchandise handiness is expected ( Fernie & A ; Sparks. 2009 ) . These new demands have rippled across supply-chains and impacted how manner concerns deliver and maximize client experience.

Harmonizing to Verdict ( 2010 ) . the lifting usage of high-velocity broadband worldwide is further easing the growing in on-line retail spend and its influence on the motion. storage and sale of ware from production through to ingestion and service support. E-commerce is turn outing to be an progressively important distribution channel. poses both challenges and wagess for manner retail merchants. The challenge for manner companies has been to switch off from traditional methods of supply-chain direction ( SCM ) towards an incorporate attack that attempts to develop end-to-end supply-chains that are consumer-centric instead than product-centric. supplying customized merchandises and services ( Sreenivas. 2007 ; Fernie. McKinnon & A ; Sparks. 2010 ) .

Over the last few old ages. many concerns in the manner retail sector have forged success by come ining into the e-commerce market and determining their supply-chains in order to be antiphonal to these alterations in consumer outlooks and demands. Founded in 2000. pureplay e-commerce retail merchant ASOS. has maintained a competitory advantage by analyzing and moving upon the elaborate prosodies that apply to its client base. The company depends upon its supply-chain being “fast and flexible. with short lead-times and speedy repetitions and deletions” ( Webb. 2010: 5 ) . It is clear that ASOS place an accent upon legerity and market reactivity. defined by Christopher et Al. ( 2004: 367 ) as being “characterised by short time-to market. the ability to scale up ( or down ) rapidly and the rapid incorporation of consumer penchants into the design process” .

Supply-chains have had to go flexible adequate to offer manner concerns the ability to do alterations in their operations or merchandises in order to fulfill increasing consumer outlooks ( Bartlett. Julien and Baines. 2007 ) . Fernie & A ; Sparks ( 2009 ) emphasis the importance of legerity in relation to SCM when flexibleness and reactivity are demanded. Harrison et Al. ( 1999 cited in Christopher & A ; Towill. 2000 ) identified to be genuinely nimble. a supply-chain must posses a figure of separating features as Table 1 suggests. Table 1: Features of nimble supply-chain

Market Sensitive| * Utilizing information technolgy straight from point-of-sale to capture existent consumer demand. | Virtual | * Sharing informations between purchasers and providers. * Information-based instead than inventory-based. * Enables spouses in supply-chain to move upon existent demand | Process Integration| * Leveraging the usage of shared information. * Buyers and providers collaborate in joint merchandise development. co-manage stock list and usage common systems. Network Based * Increased accent placed on co-ordination. coaction & A ; relationship buliding among supply-chain memebers.

Beginning: Christopher and Towill. 2000

In reaction to new participants come ining the market with on-line offers. many traditional retail merchants responded to this alteration and started merchandising on the e-commerce market. with a multi-channel attack to retailing going the norm in the mid-2000s ( Fernie & A ; McKinnon. 2009 ) . Multi-channel retailing involves the usage of more than a mono to sell goods to consumers. such as retail shops. online shops and Mobile shops with retaliers like Next PLC and John Lewis open uping the thought in 1999 ( Fernie & A ; Sparks. 2009 ) . FreshMinds ( 2010 ) recognised that the displacement from traditional retailing towards multi-channelling is an on-going procedure fuelled by the Internet and going an indispensable concern scheme. presenting challenges every bit good as chances. for manner retail merchants.

Christopher et Al. ( 2004 ) identified a figure of important alterations that have challenged supply-chain operations including short merchandise life rhythms. high degrees of impulse purchasing and volatility. coupled with low predictability of demand. While the traditional dress industry theoretical account worked on long lead times. in recent old ages at that place has been an addition in ‘time-based competition’ and the demand for manner concerns to concentrate on lead-time decrease and develop more antiphonal refilling systems ( Christopher et al. 2004 ) . Many retail merchants have looked to planetary sourcing in cut downing lead times with Jin ( 2004. cited in Doyle. Moore & A ; Morgan. 2006: 3 ) identifying that “a balance between planetary and local sourcing may be the best path [ … ] with accent being placed upon domestic providers where demand is extremely volatile and unpredictable” . Deputy Chairman at Zara. a multi-channel retail merchant that was waiting for on-line consumer demand to construct before establishing into internet in 2010. declared “In the following few old ages. we will beginning more basic points from China and Vietnam. but the high value added manner points will go on to be made closer to place ( Anon. 2010 ; Linguri. 2005 ) .

With consumers deriving more power in the selling channel at that place has been a displacement from push to draw in the supply-chain ( Porter. 1985 ; Fernie. McKinnon & A ; Sparks. 2010 ) . This has resulted in a displacement off from traditional methods of SCM. which were considered to be thin and forecast-driven. towards more nimble and demand-driven supply-chains. As antecedently mentioned. there has been increased non-price competition in the manner retail sector.

Retailers such as Zara. H & A ; M and New Look. have shifted their focal point of competitory advantage towards fast response to altering manner tendencies and consumer demand ( Barnes & A ; Lea-Greenwood. 2006 ) . As identified by Christopher and Towill ( 2000 ) . a thin attack to SCM is most powerful when cost is the winning standard. although when service and client value are most of import. an nimble attack to SCM is important. Fernie & A ; Sparks ( 2009 ) argue. nevertheless. that there is no ground why supply-chain systems may non incorporate both thin and nimble elements. making a ‘leagile’ attack to SCM. with the purpose for retail merchants being to make value for the client at an acceptable cost as illustrated in Table 2.

Table 2: Comparison of thin. agile and leagile supply-chains Distinguishing attributes| Thin supply-chain| Agile supply-chain| Leagile supply-chain| Market demand| Predictable| Volatile| Volatile and unpredictable| Product variety| Low| High| Medium|

Product lifestyles| Long| Long| Short|
Customer drives| Cost| Lead clip and availability| Service level| Profit margin| Low| High| Moderate|
Stock-out penalties| Long-term contractual| Immediate and volatile| No topographic point for stock-out| Information enrichment| Highly desirable| Obligatory| Essential| Typical products| Commodities| Fashion goods| Product as per client demand| Beginning: Agarwal et Al. ( 2006. cited in Fernie & A ; Sparks. 2009 ) .

One of the biggest challenges now confronting e-commerce retail merchants is pull offing stock list. When a client orders an point from a retail merchants online stock list. they expect that merchandise to be stocked in the retail merchants warehouse. With consumers now anticipating dependable product-availablity across channels. stock-availablity issues are accentuated by a move into a multi-channel scheme ( FreshMind. 2010 ) . Managing stock list is particularly of import due to the whole issue of returns direction. On mean about 30 per cent of merchandises ordered online are returned. compared to 6-10 per cent for ‘bricks and mortar’ manner concerns ( Fernie & A ; Sparks. 2009 ) . Retailers need to happen efficient and effectual ways to pull off the intricate logistics involved in run intoing these new demands ( Fernie & A ; Sparks. 2009 ) . A research study carried out by Jones Lang LaSalle ( 2012: 14 ) noted:

“Traditional retail merchants must now back up the bringing of ware to clients from multiple channels- pull offing in-store and on-line stock lists and shipments- all at a more frantic gait. and all in the thick of escalating competition from pure e-commerce rivals”

FreshMinds ( 2010: 29 ) recognised “the chief challenge is to guarantee that front-end stock information is updated in real-time as orders are made across several different channels. ” With supply-chains demands going more complex. Bartlett. Julien and Baines ( 2007 ) noted that the visibilty of cardinal information and stock list is going an indispensable standard for a long-run competitory advantage. One solution is to implement a Warehouse Management System ( WMS ) that enables a real-time. eternal nexus with the web front-end ( FreshMinds. 2010 ) . Marks & A ; Spencers ( M & A ; S ) . a multi-channel retail merchant. late overhauled its supply-chain to better in-store handiness. cut down end-of-season mark-downs and increase the legerity and transparence of supply-chain operations. Andrew Skinner. trading manager at M & A ; S. noted the new systems would give the company “the stock list visibleness we need to do more profitable determinations. aid fit our strategic and tactical programs with local client penchants. and drive overall profitability” ( King. 2011 ) .

Equally good as merchandise availablility. order fulfilment has become an indispensable component in heightening client satifaction. Fernie. McKinnon & A ; Sparks ( 2010 ) identified that e-fulfillment. particularly the ‘last mile’ job of presenting goods to the terminal client. holds the key to success in obtaining a competitory advantage. Boo. com is frequently cited as an on-line manner retail merchant that failed due to its inability to successfully fulfil orders it received ( Jackson & A ; Shaw. 2009 ) . A survey conducted by FreshMinds ( 2010 ) found that 40 % of consumers have been discouraged from shopping on line due to dissatisfaction with a anterior bringing experience and that 45 % expression for bringing information before they start to shop. With the debut of e-commerce. consumers have come to demand dependable bringing and return options at times of their choosing ( Fernie & A ; Sparks. 2009 ) .

Many retail merchants have responded to this with advanced bringing and aggregation services. High-street retail merchants. such as John Lewis and New Look. hold begun to offer an in-store pick-up service to online clients known as ‘click and collect’ . In revenge to this. many pureplay e-commerce retail merchants. have looked to utilizing 3rd party service logistics suppliers to offer a similar service to store-based retail merchants. For illustration. ASOS and misguided. co. United Kingdom. hold partnered with Collect+ which gives clients the option to roll up or return their order via a nominative independent shop supplying they offer the Collect+ service ( Verdict. 2010 ) . However. in malice of this. FreshMinds ( 2010 ) identified that a figure of manner concerns trading online are still fighting to maintain up with their bringing and returns outlooks.

New challenges have besides emerged in the manner manner concern deliver and maximize client experience. It is of import for retail merchants to retrieve that on-line consumers spend less clip shoping through a brand’s site than they would when come ining a physical shop. With retailers’ rivals merely a click off. web sites should take to supply originative ways to expose merchandise scopes and engage with consumers ( Verdict. 2011 ) . As “product” is the nucleus component in the selling mix. it is critical that e-commerce retail merchants replicate the consumers need to ‘touch and feel’ garments before buying. Many have attempted to make so by using rapid climb characteristics. 360° positions and catwalk pictures ( Jackson & A ; Shaw. 2009 ; Verdict 2010 ) . In relation to selling communications and prosecuting with consumers. there has been a displacement from the usage of traditional advertisement towards new channels of communicating that provide information on merchandises and services ( Jackson & A ; Shaw. 2009 ) . Several retail merchants have begun to utilize societal networking sites such as Facebook. Twitter and internet web logs to interact with their consumers. In January 2011. ASOS launched Europe’s first transactional Facebook site that allows clients to buy. go forth remarks. ‘like’ merchandises. and link their sentiments on ASOS points to their Facebook profiles ( Verdict. 2011 ) .

Along with e-commerce and f-commerce. many retail merchants have begun to research other new channels of distribution beyond the traditional ‘brick and mortar’ shops such as m-commerce and in-store booths. Mintel ( 2012 ) noted that while comparatively new to the market. m-commerce is spread outing at a rapid gait and looks set to be the hereafter of the manner retail sector. A figure of retail merchants have begun to encompass the m-commerce market with Oasis establishing an iPhone app in 2009 followed by Next and Warehouse in 2010 ( FreshMinds. 2010 ) .

Harmonizing to Verdict ( 2010 ) . these new channels are as cost effectual as online shops and can function to widen a trade names presence and aid to maximize profitableness by complementing physical shop gross revenues. It was identified. through a figure of surveies. that the multi-channel client is the most valued client and tends to pass more ( Berman & A ; Thelen. 2004 ; Fernie & A ; Mc Kinnon. 2009 ) . However. to accomplish this. it is of import for retail merchants to develop a well-integrated multi-channel scheme by supplying a consistent. end-to-end client experience regardless of the channel by which the client chooses to shop. In carry throughing this. a retail merchant must present certain features as shown in Table 3 ( Berman & A ; Thelen. 2004 ) .

Table 3: Features of a well-integrated multi-channel scheme Integrated promtions across channels| * A unvarying message is created * Promotions planned on horizontal footing across channels. non vertically by making separate promtions for each channel. | Product consistence across channels| * Too small merchandise convergence across channels crates inconsistent image. * Too much convergence may ensue in loss of gross revenues opportunty. * Solution is to utilize Web as agencies of offering extremely specialised ware. | Shared client. pricing and inteventory informations across channels| * Effectively pull off an information system that portions informations across channels. * Changeless communicating among channels is critical. | A procedure enabling shop pick-up for points purchased on the Web| * Consumers favour this attack as agencies of avoiding transportation charges. * Requires database to be integrated. | Search for multi-channel chances with appropriate partners| * Multi-channel scheme may necessitate extra resources. * Strategic partnerships with houses that offer complementary services e. g. third-party logistic suppliers. | Beginning: Berman and Thelen. 2004

Debenhams late won the Retail Week best multi-channel retail merchant of the twelvemonth award in 2012. The retail merchant aims to do the client shopping experience every bit convenient as possible and has been committed to adding new channels to complement their bing shops and on-line presence such as a Mobile optimised website. in-store booths and catalogues ( Paige. 2012 ) . Harmonizing to the Debenhams Annual Report ( 2011 ) . the integrating of shops and other gross revenues channels is what makes them a true multi-channel retail merchant. While some retail merchants are turn outing to be successful in implementing a well-integrated multi-channel scheme. harmonizing to Metapack ( 2010 ) . several retail merchants have ground to do up by bettering existent clip visibleness of their stock every bit good as upgrading their order fulfilment solutions.

In decision. the e-commerce market is turn outing to be an progressively important distribution channel for manner concerns. However. every bit good as wagess. challenges have emerged that retail merchants are now faced with. There has been a displacement in market power towards consumers based on decreased information dissymmetry. Consumer purchasing forms are now altering which have challenged supply-chain systems. There has been the development of incorporate SCM to enable speedy responses to consumer demands with an increasing accent on visibleness. flexibleness and relationship edifice between members of the supply-chain. Effective direction of the supply-chain to supply a client orientated shopping experience has become a primary demand for a manner concern to win in e-commerce market. While many retail merchants have proved to be successful with a move into the e-commerce market. others have room for betterment by increasing the integrating of their supply-chains maps.


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