Logistics and outsourcing in the supply chain

 CPFR Models 

Quick response in logistics and SCM ensures product innovation in the market: the logistics supplier can deliver the vision of designers and buyers, reduce and minimize disturbances in the chain and coordinate and consolidate goods, which is especially important when launching new products and ranges. Data collection and the appropriate and relevant technology must be in place for this to work properly. One such example is a Collaborative Planning Forecasting and Replenishment (CPFR) model of supply. CPFR is ‘a business practice which reduces inventory costs whilst improving product availability across the chain. Trading partners share forecast and results data over the Internet. CPFR data analyses data and alerts planners and merchandisers at each company to exceptional situations that may affect delivery or sales performance’ (Hines, 2005). Trading partners collaborate to resolve these exceptions in the chain in order to maintain stock and availability. CPFR models have been replicated and adapted for use by many large, international fashion retailers in order to make suppliers responsible for stock management. Good stock management is crucial to success in the fashion industry.

Future of technology 

Some large, international retailers are investing in new technological models of supply, including retail exchanges and e-tail logistics, such as the global net exchange (GNX) and the worldwide retail exchange (WWRE) developed by Walmart. Technology helps fashion retailers with sales information that can be transferred and acted upon quickly. These include the following: EDI (electronic data information) packages for sharing data between supply chain partners; EPOS – electronic point-of sale data collection from stores; and SBO, which is sales-based ordering technology (orders placed to replenish sold stock). Other technology used in SCM includes electronic tagging radio frequency identification tags. Walmart piloted a study in the USA and UK fashion retailer Marks & Spencer has trialed its use on high-value items such as suits and leather jackets. The tags can be used to achieve good visibility in the chain; retailers such as Benetton, Gap and Esprit use the tags to track stock movement in the supply chain. They can be used during transportation and warehousing so logistics teams can identify stock, size and color without unpacking boxes and by scanning stock that is packaged. It cannot be emphasized enough that good relationships and outsourcing are fundamental to the future success of SCM in the fashion business and improvements in technology may be used to enhance these relationships. The focus is on fashion retailers in the future to provide better value and to create greater responsiveness via partnerships.

ELECTRONIC TAGGING 

 UK retailer Marks & Spencer has trialed the use of electronic tagging radio frequency identification tags on high-value items such as suits and leather jackets.