THE FASHION BUSINESS

1
THE FASHION BUSINESS

• The strategic role of the textileand fashion
  operation

2
LEARNING OUTCOME

• to understand the strategic role of the textile
  and fashion operation
• to identify the added value requirements for the
  industrys different product segments
• to understand the contribution of effective
  operations strategies in servicing the fashion
  market

3
A CUSTOMER DRIVEN OPERATION

• The process starts with the customer (customer
  needs and use situations) and ends with the
  customer (the customers level of satisfaction).
  
• (Walters, 1999)

Customer Needs
Value Drivers
Desired Benefits
Value Creation
Customer Satisfaction
Cost of Purchase
Customer Use Situation
4
INDUSTRY CHARACTERISTICS

• Ever more demanding end-consumers
• Smaller order quantities
• Shorter lead-times
• Unpredictable demand
• Demand for accurate order information

5
ADDED VALUE REQUIREMENTS

• Focus on customer requirements
• Strong internal marketing/operations link
• Flexible operations
• Focused RD
• Investment to combat industry competition
• Capture selective market opportunities

6
VALUE CREATION

• A value strategy involves identifying,
  producing and delivering the combination of price
  and non-price related benefits the customer is
  seeking
• (Walters, 1999)
• Our premise is that buyers will buy from the
  firm that they perceive to offer the highest
  delivered value.
• (Kotler, 1997)

7
THE FASHIONMERCHANDISE RANGE

• Basic Products
• generally sold throughout the year
• Seasonal Products
• shelf life of 12-25 weeks
• Short-Season Products
• shelf life of 6-10 weeks or less
• (Lowson, 2003)

8
THE PRODUCTLIFECYCLE THEORY
Stages Features Introduction Growth Maturity Decline
Demand Low Rising Steady Falling
Product Design Changing Some Change Standard Adjustments
Process Small Scale Larger Scale Mass Production Adjustments
Selling Price High Fairly High Lower Low
Total Revenue Low Rising Peaks Falls
Unit Costs High Falling Lower Variable
Profit Low Rising Peaks Falls
Number of Competitors Few Rising Stable Falling
Focus on Operations Flexibility, Reliability Scheduling, Capacity Cost Reduction, Productivity Cost Control, New Products
Source Waters, 2000
9
PRODUCTION REQUIREMENTS
Introduction Growth Maturity Decline
Basic Products Cost focus Cost focus Cost focus Cost focus
Seasonal Products Added value Cost focus Focus on cost Added value
Short season Products Novelty/Added value - - -
10
COST OF PURCHASE VS. COST OF PRODUCTION
Strategic effectiveness - doing the right
things Operational effectiveness - doing the
right things right
NOVELTY to be the only one in the marketplace
SERVICE LEVEL to be committed, responsive and
reliable

• COST to be the cheapest in the marketplace

11
PROCESS CHOICE

• Project
• Jobbing, Unit or One Off
• Batch
• Line
• Continuous

• VOLUME
• VARIETY
• VARIABILITY
• VISIBILITY

12
CHASE DEMAND

• JUST IN TIME

Wherever possible no activity should take place
in a system until there is a need for it. The
system is drivenby downstreamrequirements (C
hristopher, 1998)
13
THE BASICPRINCIPLES OF JIT

• Eliminate waste
• Involve everyone
• Continuous Improvement

14
PUSH AND PULLSTRATEGIES
PUSH
PULL
Manufacturer
Manufacturer
Wholesaler/Agent
Wholesaler/Agent
Retailer
Retailer
Customer
Customer
flow of products
flow of communication
15
THE MARKETING MIX

• Product
• Place
• Price
• Promotion
• People
• Process
• Physical Evidence

16
MANAGEMENT ANDMARKETING OF TEXTILES