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Outlook 2020 – Apparel Sourcing Challenges Companies Face in the US

Jan 28, 2020

The rising demands of the globalized multichannel market and need to balance compliance considerations with cost and other factors have made apparel sourcing even more complex for companies. If companies have to transform their operating models and become customer-centric, they’ll have to drive end-to-end process efficiency and cross-functional collaboration. However, being more consumer-centric doesn’t just mean responding faster but also better. It also involves improving the sourcing process. But before that, let’s understand the apparel sourcing challenges that companies primarily face in this industry.

Want to know how apparel sourcing challenges will shape the industry in the coming times? Request a free proposal and our experts will get back with actionable insights to help you stay competitive in the market. 

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Key Apparel Sourcing Challenges

Impending economic downturn 

Long-known for their cost-consciousness, companies in the apparel industry need to tighten their belts amid the chances of an impending economic downturn. They need to address apparel sourcing challenges while dealing with uncertainty, volatility, and shifts in the US economy. Developing cost-effective sourcing strategies and centralized supply chain platform could help apparel businesses gain a comprehensive understanding of the end-to-end operations and tackle apparel sourcing challenges efficiently.

Shift in sourcing 

Given the uncertainties in the market and changing regulatory environment, apparel sourcing has become a major issue in the apparel category. Local sourcing has entered into the picture and US retailers want to develop transportation efficiency to move goods quickly through the supply chain amidst changing customer preferences for sustainable goods and growing tariff pressures. The industry could see an uptick in nearshoring soon, increasing the proximity of manufacturing operations to customers. A combination of technology and expertise could help companies address apparel sourcing challenges and determine the best transit strategies.

Need for digitization 

Many companies still rely on outdated supply chains and sourcing processes due to their resistance to change. The industry is still at the beginning of its digitization journey and they need to accelerate digitization to achieve higher performance levels. Those failing to break silos between sourcing and product development will find it difficult to transform to a customer-centric operating model, thereby impacting lead times, transparency, sustainability.   

The inability to adopt new-age models and technology in the business will make it difficult for retailers to streamline sourcing and production. Stay a step ahead by requesting a free demo of our procurement platform to gain exclusive insights to devise effective apparel sourcing strategies. 

Demand-based supply chains 

The rules of inventory have changed in light of the way consumers shop the latest fashions today. Customer preferences change faster, putting pressure on businesses to keep shaving time off production and transit. To be more responsive to changing customer preferences, businesses must improve the apparel sourcing process, integrate product line management with the supply chain strategy and reduce the time to market for better decision-making. 

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