The fashion industry is extremely competitive, especially in today's fast-paced retail environment. Traditional retailers must keep pace with the leaders in the fast-fashion world if they want to continue to make a profit.
According to Heath Wells, co-founder and CEO of B2B e-commerce platform NuOrder, by streamlining business operations and improving communication with manufacturers and wholesalers, legacy retailers can reduce the lead time between buying and delivery. Simplifying the process allows retailers to reduce their supply chain, refuel products more quickly and better anticipate customer interests.
FierceRetail spoke with Wells to learn more about how apparel retailers can keep pace with the competition in 2017.
FierceRetail (FR): What does "fast fashion" mean for retailers in 2017?
Heath Wells (HW): Fast fashion means the ability to go from design to in-store in as short a time as possible. Vertical retailers like H&M, Zara and TopShop have built their businesses on the ability to take catwalk trends and deliver in-store as soon as possible, sometimes before the designer who set the trend is able to deliver.
In 2017 and looking ahead, fast fashion will be an expectation of both retailers and consumers. Brands that don’t typically deliver fast fashion will use technology to join in and more quickly meet demands. Nonvertical retailers who rely on brands they purchase through wholesalers face challenges in getting these brands in-store quick enough to capture fast-moving trends.
FR: What are some of the key points in the process that often hold up retailers?
HW: Much of the current processes are broken. We live in a world that is always on and is ever changing, but the current systems and processes have not adapted to meet these needs.
A few points in the process that hold retailers up include:
- Brands usually sell products in bulk in person (quite often at physical trade shows or showrooms) up to six to nine months in advance of when retailers will put them on physical or virtual shelves. This sales model doesn’t work anymore, as retailers don’t want to run the risk of committing to product on such long lead times. Retailers want to be able to purchase more frequent on-demand orders rather than singular bulk orders to reduce inventory risk.
- Brands also sell from printed catalogs, taking orders via Excel or hand-writing and then manually inputting order into a backing system run by the brand. This static process doesn’t allow for flexibility in changing product data and inventory, which creates headaches for every person involved in the process, from sales reps to buyers, and doesn’t allow for vital features technology enables, such as forecasting.
- Brands hold their data in multiple hosted (not cloud) systems, which requires manual uploads and exports, and makes it nearly impossible to integrate across an organization. Brands should be able to feed sales, e-commerce channels and retailers a live and accurate product catalog, including inventory positions.
- Retailers and brands operate on separate systems, which creates a lack of transparency of each other’s inventory. How many times have you gone to a store (online or physical) only to find out they are out of stock? This should not happen. The two systems also cause unnecessary duplicitous work for both parties. For example, rather than sharing product data digitally from brand to retailer, major retailers are forced to re-enter product data into their own systems, even taking their own photos and creating their own product catalogs.
FR: What are some steps that manufacturers and retailers can take to improve communication throughout the process?
HW: There need to be two levels of integration to improve communication. Integration between brands and retailers, as well as integrated systems for sales and e-commerce.
Brands need to remove all printed or static information from their sales process. The retailer must be provided a digital catalog, as moving to an online system streamlines communication and speeds up processes.
FR: What is NuOrder's role in the buying and selling process?
HW: Simply put, NuOrder is e-commerce for wholesale. We are the digital catalog a buyer can purchase from 24/7. No more printed orders or physical catalogs. As everything is digital, NuOrder can take an order and send to a warehouse for shipping immediately. We can arm global sales teams with live information, including inventory and exact delivery dates, so when they consult with buyers they have confidence in the information they are presenting. Finally, as NuOrder is online, it's not limited by geography or time zone. This opens up an opportunity for brands to reach beyond the areas where they have sales reps.
FR: Can you tell us about a current retailer that you are partnering with and what positive outcomes that retailer has experienced?
HW: I recently spoke with the CEO of Alternative Apparel. They are a $50 million plus fashion basics company that wanted to provide their sales team and buyers with a live catalog that could be trusted. Additionally, they wanted to be able to ship orders same day via an integration from NuOrder into their ERP.
Alternative Apparel has a digital-first mindset, which has enabled their continued growth in this changing retailer environment. If a retailer can trust a brand’s catalog and ability to deliver quickly, then they can depend on that brand. This maximizes the sales opportunity.
Alternative Apparel realized they could sell into the activewear space in addition to fashion. Without the massive investment of an army of sales reps to cover this territory, they’ve been able to use NuOrder to send digital presentations and capture orders.
FR: What else can you tell retailers about the fast fashion process?
HW: Retailers should lean on their brands to provide them with accurate and live data, including inventory. This will give retailers the ability to maximize every customer opportunity and minimize stockouts.