This is a guest post co-written by Carlos Lozano of ITS-Dynamics and Fernando Labastida of KPI Online

The Fashion Industry: Innovative by Necessity

The apparel industry is one of the oldest on the planet. The earliest possible sewing needles have been dated to about 40,000 years ago.

But despite its age, it is one of the most technologically advanced non-techie industries today. Why? Everybody’s trying to figure out how to invent a fashion industry crystal ball.

Fashion changes constantly; every season is different.  The continuous color and style changes related to the various collections throughout the year are mind-numbing. To stay competitive industry executives need to create new trends that resonate with current tastes, and get them in the stores before their competitors do.

However, every fashion executive’s nightmare is dedicating a whole production line to a particular design, getting their inventory to the stores, and then the design bombs.

They’re stuck with millions of dollars of unsold inventory nobody wants.

This has led to incredible innovation and development of strategies to enable rapid business response. However, the technology tools available to do this have typically been very expensive and accessible to only the largest apparel manufactures.

What about the smaller apparel companies?

Easy and Flexible Access to Information

I think everyone can agree that information is vital to a company’s operational success, but with one important caveat: you need to have access to this data in a well-organized, easily accessible way that allows anybody, not just an MBA, to analyze the data and make decisions to solve critical business issues.

First, where is this data?

Your company has probably gathered terabytes of data in your accounting system, your ERP system, and/or other proprietary operational systems over time through daily transactions and data entry efforts by your staff.

Most of this data can be easily organized into very basic lists, documents or reports that you need daily just to run your business.

But this barely scratches the surface of what you need as a fashion industry executive, and falls short of what you can actually do with all that data locked away in your systems.

The unique data needs of the apparel industry adds an additional level of complexity.

Here’s a particularly daunting example: in the case of inventory turnover analysis, not only must you identify your stock, but you have to identify individual product attributes such as season, make, model, collection, family, product line, fabric composition, size, color and so on.

But with accurate, detailed historical and current information on all the attributes mentioned above, available in-real time (and not after-the-fact), you can begin to accurately predict where demand is heading and what to bet your production line on.

But how do you make sense of all that data locked away in your operational systems?

Business Intelligence for the Fashion Industry: No Crystal Ball, but…

What if there was a way to organize all that raw data visually, and in a way that allows you the flexibility to easily create different views, analyze the data in many different ways depending on your needs, and accurately predict demand with near statistical certainty?

Well there is a way. It’s called Business Intelligence (BI).

For example, with BI you can organize your data by operational area, so you can view inventory turnover or sales.

In the case of inventory turnover, you can identify individual product attributes, as mentioned above, such as season, make, model, collection, family, product line, fabric composition, size, color and so on.

You can easily perform historical trend analysis and predictive analysis in order to avoid costly errors such as shipping large amounts of inventory that will sit in a warehouse somewhere.

In the case of sales analysis, we could also identify and analyze attributes related to sales in order to maximize your revenues, such as: customers, customer groups, territories or customer areas, invoice amounts, product quantities invoiced, and the ability to express this information in their original currency.

You can also analyze data by sales channel.

BI: Not just for the Big Boys (or Girls)

There seems to be an explosion of domestic apparel entrepreneurship recently. Companies such as Sew Sister, Mullins Square, Bluebonnet Cut & Sew, and Good & Fair Clothing, have started to dot the landscape with innovative designs and a re-birth of personalized care and service.

Sew Sister is a typical apparel designer: dozens and dozens of different variations, based on lingerie category (bras, bustiers, pantys), and in the case of bras in particular: bra styles, band sizes, cup sizes, color, fabric and over 3 dozen patterns.

Most small companies like Sew Sister are mired in complex spreadsheet reporting projects that take hours, days and even weeks. By the time the reports are available in any meaningful way the data may be too old to take timely action on.

The good news is that the kind of power available to large apparel companies is now available for a very reasonable financial outlay.

And when I say very reasonable, I mean reasonable on several different fronts:

• Low monthly rental vs. high up-front costs
• No software installation or configuration costs because they’re available online as a service
• No training costs because training is now provided via online videos
• No costly data integration costs because these solutions are usually joined by easy-to-use automated connectors to the most commonly used ERP or accounting systems

As a small or mid-sized apparel industry executive, you know it’s not just data that’s key to successful company operations and competitive performance, but easily accessible, flexible, configurable and user-friendly data.

To learn more about BI for the small fashion company, view some of our videos, or sign-up for our weekly Thursday webinar, or visit ITS-Dynamics for fashion industry specific solutions.

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