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Why Making Close to Customer Will be Vital for Supply Chains

With demand expanding to new heights as consumers grow increasingly connected, supply chains will have little choice but to shrink to suit.

That was one message made clear at the recent American Apparel & Footwear Association Sourcing Conference, where panelists agreed that getting closer to the customer is key, and innovation and technology will be the tools to make it happen.

“If you set it up correctly, proximity can go far,” said Juan Zighelboim, president of TexOps, a forward-thinking active apparel manufacturer in El Salvador. For TexOps, delivering on today’s speed to market demands has had a lot to do with its proximity to the United States, but also to what Zighelboim referred to as “elevated collaboration,” or the idea that doing things like assisting the design team on the front end to hone in on the right decision making at the right time, and eliminating the often rampant back and forth in the product development cycle, has also had a lot to do with it. “The brands today are really going upstream and they’re investing in it.”

Part of those upstream investments are in the technologies that drive things like 3-D sampling and a transparent, solutions-driven product development platform that both the design team and the supplier can be synced up to.

Those investment dollars are also being designated to robotics, though most of the apparel industry isn’t as tapped into what robotics can bring as they perhaps should be. Really, according to Pete Santora, chief commercial officer for sewing robotics firm Softwear Automation, robotics and automation may be one of a few ways to survive the steady storm that is Amazon.

“The expectations Amazon sets on a toothbrush kills you with your dress because it makes you think you can get all of these things instantly,” Santora said to a room full of apparel brands, retailers and manufacturers. “And if you think millennials are bad, your next generation of customer is your worst nightmare. Their max wait time is two days. For custom.”

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That see now, want now mentality will only prove more challenging for brands and retailers as demand for custom becomes commonplace.

“It’s no longer small, medium and large. The size is each individual person—how do you deliver to that? What’s your supply chain for that?” Santora posed. “This concept of how to run faster or what is Amazon doing as a technology company—their aim is to get to production of one.”

And it’s not just Amazon targeting that aim. Niche pop-up shops or startups that are filling consumers’ often unsatisfied need for interesting product, are creating tailored, one-off, custom designs, branding them to deliver on that unboxing moment, and quickly setting themselves far apart from big box department stores that continue to lose favor.

“It’s not like you’re competing against the little guy in New York making custom bags, but he definitely does make your job harder,” Santora said.

The future for manufacturing has far to come from its old-world ways of pushing product to create demand and then hoping for sales. Today—and for the foreseeable future—consumers are clear about what they want and they’re only buying from brands that can deliver it. So the brands’ job will be to figure out how to create a supply chain that’s designed to react rather than repeat what it’s long known. But so far, many have been missing the boat on building in what they’ll need.

“You leave it up to the manufacturers to be able to develop the technology because you don’t think there’s any IP in it,” Santora said. “But I think that’s a big miss.”

Manufacturers like TexOps are delivering where brands aren’t, and it’s putting them at a greater advantage than they’ve ever had in the past buyer-rules-all world.

“From design, the only thing we don’t do is hang the stuff up at the store,” Zighelboim said. “The more we can offer, the better off everybody is. And it’s another reason that being closer to market is a huge tool. In a very short period of time, you’re going to see a lot more action on this side of the world. I’m pretty confident in that.”

For Santora, nearshoring holds less appeal than being right next to the customer—and automation offers that option. But only if brands and retailers can learn to wholly weave the technology into their product development processes.

“Automation, this knowledge, it has to come further up the chain to the design process. Not to ‘hey I need to automate the collar hem. Machine vendor, go automate the collar hem,’” Santora said. “We’ll all be dead before we get to automation if we think of it like that.”