Fast Fashion – Retail at the Speed of Light
While there are certainly more than these few definitions for Fast Fashion, it is clear that variety, speed, and newness are expectations of today’s consumers, requirements that extend well past the fashion industries. Consumer Packaged Goods companies have accelerated their pace of new product introductions, electronics makers are producing more models with more technical variances, and of course the apparel business which has long been perfecting “speed to consumer” is creating more products with shorter life cycles. Moving at the pace of Instagram and social media, this trend complicates the lives of Retailers who to capture their share (or grow their share) of wallet must deal with more frequent product change outs, floor sets and breadth of offering.
The implications of this trend are particularly impactful to the merchandise office, the groups who have to plan, select, design, deliver and manage the logistics and life cycle for each of the products that a Retailer wishes to place in front of a potential customers, either on shelf, or online. Potentially 4 to 6 (or more) products are investigated, designed/built/selected and reviewed for every single product that is eventually carried. Each item requires a plan, system set up, multiple orders, allocations, replenishments, fulfillments, frequent performance reviews, repricing and often enough reverse logistics to be managed. If a company moves from 2 or 3 seasons/floor sets to 6 to 8, with potentially doubling the numbers of SKU’s carried, the resultant complexity isn’t going to be manageable by just working a little harder, a bit smarter, and a little faster. Adding to this complexity is the fact that there are a lot of hands to collaborate and coordinate involved in taking a product from concept to customer, finance, buyers, designers, sources, product developers, store planners, assortment planners, transportation ….the list goes on.
Adapting Fast Fashion techniques in this environment isn’t going to be simple. Clearly some completely new thinking and methods are required.
So how to get organized to manage in this evolving environment. Some Retailers/Brand company are used to working with an item oriented bottom ups approach. Go to market, select fabrics, design samples, collect items from vendors – lay it all out, select candidates, lay out the potential assortment and finalize the items to be carried next season (or next year depending on the supply chain). What’s the ratio of investigation to selection – 20 to 1, 10 to 1? A lot of work for a relatively small output.
For most a better approach is more top down driven, set an assortment architecture or strategy at the right point in the buying cycle – that all merchandise office participants can agree to and work from, supporting the collaborative and coordination necessities of the fast fashion phenomena. The Assortment strategy needs to be at a level of detail that is close to execution, typically at a product attribute level, and by floor set, not just at the typical category budget, or MFP level of detail. An Assortment Strategy needs to detail out the number of options by attributes required. If the plan calls for featuring 3 blue, cotton, higher priced, higher fashion items, then buying and design can narrow their search and may only need to design or select 6 or 8 candidates, half the prior ratio of candidates to final choices, reducing the overall workload for all by half, creating more time to manage the fewer product candidates, with commensurate savings in product costs, transportation costs, and time and energy.
Similarly, the rest of the merchandise organization needs to find ways to streamline their workload, typically by planning and managing product holistically, across the entire merchandise lifecycle. Instead of working through multiple systems (one for MFP, one for store planning, another one for assortment planning, a 4th or 5th one for pricing, allocating and replenishing, more for clustering, and a completely different set up for online), all of this typically held together with Excel, well you get the idea, tying all the business process requirements together seamlessly reduces work, rework, the potential for errors and the challenges in meeting critical deadlines. Business process also needs to work in a timely fashion, adhering to a strict calendar of activities and deadlines that reflect the merchandise selection, procurement, deployment and management deadlines.
Two concluding thoughts: The customer’s preferences are forcing the hand of most Retailers to increase the selection and speed of products, it’s not a question of if you should adapt to this trend, more a question of how quickly you can. Lastly, we hope you enjoyed this short, relevant article, even if the word omni-channel didn’t appear once…