If fashion and retail are to achieve their goals in the digitalization of their supply, they must increase their focus and go beyond the core areas and processes of their supply chain. If they have chosen to transform their operating systems and really focus on the customer, they must drive efficiency in the end-to-end model, interdisciplinary collaboration between companies from different sectors and make a deeper immersion in the production process.

Total digitization of the product development and manufacturing process

McKinsey’s report The apparel sourcing caravan’s next stop: Digitization and its surveys to the supply managers of leading fashion companies went beyond the supply chain itself. The international consulting firm has measured the expected impact and actual maturity of digitization in four areas: assortment planning, design, production and logistics.

Through this report a great potential impact was identified in all these areas mentioned and their own processes. The opportunities for improvement identified are as follows: predictive analysis in production planning and demand in the area of purchase planning and assortment, 3D design and virtual prototypes in the area of design, digital printing, automatic/dynamic inbound planning and radio frequency identification (RFID) in the last two areas, production and logistics.

When executives were asked to rate the current digital maturity of their companies, a piece of information became clear that we consider very important. In most of the categories, the executives consulted said that the current maturity is low or very low. Only when it comes to digital printing did a significant part of the organizations rate its maturity as high.

Predictive analytics is the biggest opportunity for the fashion industry and retail

The greatest potential impact identified by sourcing managers of leading global brands has been found in predictive analytics, more than in any other factor of digitization. And the great opportunity for companies is to work on the large gap that exists between the current levels of maturity of the digitization process in organizations and that detected potential. The opportunity manifests itself from predictive analytics as part of a digital sourcing system focused on the retail customer. Precisely the latter we have analyzed in: Customer-centric digital sourcing; I recommend you read that article before proceeding.

We see, then, that predictive analysis in demand planning is not being applied in the fashion and retail sector, although as we all know, systems have been available for several years now. Beyond the planning or distribution of the assortment, predictive analytics generate automatic learning to strengthen the prediction of trends, optimize decision making in creative processes and improve the performance of the design department. Organizations and fashion brands can also use predictive analysis in demand planning to analyze a large number of variables that influence demand, such as trends in social networks, climate variations and different seasons, among other data.

Conclusion: Predictive analytics allows organizations and their teams of collaborators to tip the balance between “art vs. science” on the side of science.

3D design and virtual prototypes are extremely disruptive

The move from traditional design to 3D design will undoubtedly mark a turning point for the fashion sector and its industry, leading a transcendental innovation in the design process. Virtual samples significantly reduce time in the product development process. Fashion companies that have implemented 3D design and virtual samples report reductions of 15 days or more in the pre-production process and a reduction of more than 50% in the number of samples needed and the cost involved in the process. In addition to fabric and accessory samples, fashion brands can incorporate real-time costing into the process, generating so-called value design.

Reducing lead times through digital printing

Digital printing has been mentioned as the process of greatest digital maturity within the leading companies as rated by 32% of sourcing executives. That is why it is clearly the most advanced aspect of digitalization in the manufacture of clothing. This technology, along with automated cuts, can reduce production time, increase flexibility and reduce waste. Digital printing is expected to democratize design by creating the flexibility needed to produce garments, footwear and accessories in small, customized batches. Of course, we must clarify that digital printing is not an individual solution, but must be considered as part of a fluid digitized process that includes 3D design, virtual classification, virtual size adjustments and cost analysis.

In logistics, the digital challenge is in automated inputs

In logistics, the digital objectives are: automatic order processing and dynamic real-time replanning that reduce costs through automation of manual tasks, usually performed by human labor, and achieving greater reliability and an improved customer experience through immediate customer feedback. The goal is a “contactless” process, where there will be no manual process between the receipt of the order, its confirmation and its delivery.

Radio Frequency Identification (RFID) in manufacturing

RFID and other sensors are used in the manufacturing process in managing and optimizing the efficiency of production lines, protecting intellectual property and tracking the origin of materials as long as it focuses on sustainability and quality. Only 16% of CEOs rated the maturity of their companies as high in the use of RFID.  Therefore, those who have adopted this new technology are ahead of their competitors.

The disruptive potential of Blockchain technology

Another opportunity detected by the sector and the industry in digitalization is the Blockchain technology. It will enable the transformation of the process through which information and transactions are collected, analyzed and recognized, stored and shared among organizations and throughout the ecosystem, thus increasing traceability and clarity in the supply chain. I anticipate that we will be analyzing this technology and its application to the fashion sector in future articles.