Industry executives also point to the importance of flexibility and say change is here to stay.
Lesson 1: Sourcing diversification is key to mitigating supply chain disruption
Robert Antoshak, industry consultant, suggests the biggest lesson from the pandemic was how vulnerable the industry was to supply chain disruption. He says: “The industry is accustomed to dealing with changes in the economy, but when supply chains knotted up, folks really panicked. After all, the system was built with the assumption that disruptions would be rare, or at least manageable. The effects of the pandemic were certainly not manageable.
“Consequently, long and complicated supply chains proved to be especially vulnerable to disruption with the first lockdowns. In fact, the whole notion of just-in-time-delivery became a pariah illustrating the fragility of the system. Add in port blockages, worker shortages, and other logistical bottlenecks, and the system collapsed in on itself.
“A lesson for the industry to learn is how to better manage risk. In this case, sourcing diversification is the key – near-shoring and/or on-shoring when paired with traditional global sourcing is the best way of mitigating risk. However, this approach does require brands to work harder as the system involves more sources of supply, each with their own set of challenges. And these challenges add up to reasons why many firms maintain their traditional sourcing strategies.”
Lesson 2: The apparel industry can still change its negative image on sustainability by moving from pledged to real solutions
Matthijs Crietee, secretary general, International Apparel Federation (IAF), says: “As a society and as an industry we have learned that we were taking too much for granted. For our apparel industry, this included the smooth running of supply chains. Through exploding transport prices, cancelled orders and lost confidence, Covid ferociously taught us that as a matter of fact supply chains are sensitive constellations needing care and attention. Fortunately, the opposite is also true and rebuilding trust by investing in more resilient supply chains brings the industry in a better position to tackle its climate, human and financial problems. Our industry is in the spotlight as a major contribuant to global warming. We must move from pledged to real solutions. Through strong supply chain collaboration we can potentially turn the negative trend around and present a much more positive image of our industry to consumers all around the world. The pandemic showed, for example through the huge success creating vaccines at record speeds, that focused investments and a sense of urgency can create miracles.
“And of course, there are other less massive but also important lessons. For example, it seems that our nearly US$1tn apparel and textile industry’s overseas trade hinges on only a few shippers that are able to increase prices to an incredible extent. How did we get to this point and, more importantly, how do we get away from it?”
Lesson 3: Buyers can’t be in control of everything and brands now have a golden opportunity to create equal partnerships with their suppliers moving forward
Dr Marsha Dickson, president and co-founder of Better Buying Institute says: “That buyers can’t be autonomous, and in control of everything. The pandemic revealed firsthand how poor purchasing practices on the part of buyers directly impact on suppliers’ ability to pay living wages (or any wages at all) and ensure decent working conditions.
“As we build back, brands have a golden opportunity to bring their suppliers into the cockpit with them, as equal partners on a shared journey towards business success and sustainability.”
Lesson 4: Embracing new digital tools can improve speed to market, costs and customer satisfaction
Rick Horwitch, chief of supply chain and sustainability strategy, global retail lead, Bureau Veritas Consumer Products Services, says: “The greatest lessons have been around people and digitalisation. We have learned our teams have the ability to survive and thrive by being innovative, collaborative and resilient. Companies have learned that embracing digital tools (3D design and fit; colour approval; remote QC/inspections; etc) can be empowering, enhance collaboration and innovation, and improve speed to market, costs, and customer satisfaction.
“We have learned the importance of empowering and collaborating with our people and supply chain partners. This is building stronger relationships (internal and external). Moreover, we have learned the importance of collaborative dexterity – using the tools at hand to get the job done, embracing (not being afraid of) new tools, ideas and methodologies and asking our partners for recommendations to improve – and acting on these recommendations.
“I hope that we have also learned that this is not the last crisis, so we need to be prepared with plans, strategies, data and insights to help plan for the future. Business continuity plans and supply chain transparency have become critical.”
Lesson five: Building solid and partner-based importer-supplier relationships are crucial
Dr Sheng Lu, associate professor at the Department of Fashion and Apparel Studies at the University of Delaware says: “The apparel industry’s great lesson from the pandemic could be the importance of building a solid and partner-based importer-supplier relationship. For years, known as a “buyer-driven” industry, apparel brands and retailers attach great importance to their end consumers but somehow “take their vendors for granted.”
“However, during the pandemic, fashion companies increasingly realise that their business relies on support from capable vendors, providing speed to market, sourcing flexibility and agility, competitive sourcing cost, and low compliance risks.
“As the saying goes, “Life is like a bank account. You cannot write a cheque without first making a deposit.” The same applies to the apparel industry. More than ever, fashion brands and retailers need to invest in their vendors, treat them as true partners and help them grow.”
Lesson six: A seamless multi-channel offering is imperative to ensure business can continue regardless of restrictions and disruption
Lynda Petherick, head of retail, Accenture UKI says: “One of the greatest lessons of the pandemic has been the imperative of having a seamless multi-channel offering to be able to continue serving customers regardless of social restrictions and disruption. The pandemic actually forced many consumers- who may not have previously shopped online- to start doing so, providing an opportunity for apparel retailers to reach new audiences online.
“Though, despite many sales shifting online, the high street still holds a place in customers’ hearts. Having not been able to visit them for months on end, the novelty of “trying before they buy” still appeals to many. However, with the risk that some may never go back to in-person shopping, retailers must ensure their stores are more experience-led whilst being synchronised with digital/app offerings to entice the more discerning customers back in-store.
“Resource recovery has also been a huge learning curve for brands in recent years. The yo-yo of social restrictions made it incredibly hard to forecast trends, even rendering some fashion collections useless. The pandemic highlighted the opportunity for brands to re-evaluate how they process items that aren’t selling in their current form, in a bid to avoid waste- good examples of this are exploring solutions such as reusing fabric for future collections or repurposing other materials.”
Lesson seven: Change isn’t going away
Deepika Rana, chief operating officer, Li & Fung says: “One of the biggest lessons learnt from the pandemic is that change is here to stay. We need to challenge the norm and past practices that proved critical and important are no longer valid in the new world order. For example, who would have thought that retailers, including design and sourcing, could manage their businesses without travel to Asia for over two years? The pandemic accelerated the uptake of technologies such as 3D digital product development which saves costs, time and raw materials and also the use of tools to enable virtual factory walk-throughs and inspections.
“The past two years have pushed supply chain players to prioritise resilience over efficiency; cost over speed; strategic relationships and trust over transactional activities and most importantly de-risking the supply chain through diversification and planning. That means creating a strong backbone of core partners across geographies to build greater flexibility and agility in the supply chain. Additionally setting up operations in a new country or onboarding a new vendor can no longer be knee-jerk reactions as they have been in the past, and trust and long term relationships will play an important part.”
Lesson eight: Sustainability, circular economy and innovation should be top of mind
Şenol Şankaya, chief executive officer, Yeşim Group says: “The ready-to-wear and apparel industry has learned important lessons during the ongoing pandemic. First of all, the concept of hygiene has become more important than ever before in this process. We are entering a period in which we will be more prepared for possible epidemics in the future. The committees and crisis teams formed by the companies regarding this issue will keep their sensitivity on this issue at the highest level in an alarm state.
“On the other hand, we are in a process where the concepts of sustainability, circular economy and innovation gain more importance. In particular, the concept of sustainability has entered all areas of our lives with a much faster acceleration. All major ready-made clothing and home textile brands have become more important than before by taking even more measures to ensure social compliance conditions wherever they make production in their supply chain in order to cope with such new crises.
“In addition, we had to make our working conditions more flexible during this period. We gained experience in remote working especially for our white-collar employees.”
“We clearly saw that the textile and apparel industry should use technology more in the digital world. The importance of hardware and applications that will support digitalisation and remote working was also evident. Indirectly, the requirements for security and storage solutions have been created to fulfill these demands.
“It has become very important to integrate digital solutions into business processes in terms of design.”
Lesson nine: Flexibility is king
Emily Salter, retail analyst at GlobalData, says: “Retailers learned the importance of flexibility during Covid-19, so that they can quickly adapt to changing consumer trend, with the biggest factor that many had to adapt to being the rapid shift to the online channel. For instance, players that hadn’t previously invested enough in their online proposition couldn’t cope with the increased demand, and those with poor or non-existent transactional sites couldn’t make up for lost sales.
“However, the pandemic presented brands with numerous opportunities, such as new ways of working, and catalysing the turnaround of brands through accelerated online strategies and revamped brand images – like M&S’ Never the Same Again plan and Hugo Boss’ Be Your Own Boss campaign.”
Lesson ten: Create a supply chain built on connected processes and underpinned by talent
Rajiv Sharma, group chief executive of Coats, says: “A key learning for the industry has been around the importance of supply chain resilience that is built on technology, connected processes and underpinned by talent.
“The opportunity here is to better satisfy customer needs, grow sales and improve margins. All this at scale and speed.”
No single lesson
Stephen Lamar, president and CEO, American Apparel & Footwear Association (AAFA) says: “There’s no single lesson. “Certainly, the sudden health and economic crises that the pandemic unleashed has taught us that we can make changes quickly. We can see this through the advancements in digitalisation and other technology and the dramatic growth of e-commerce. Of course, bad actors can find opportunity in crisis as well.
“Today, with the rise of e-commerce ushering in a new era of dangerous counterfeits, we’ve doubled our efforts to keep those counterfeits out of the homes of consumers and are pressing Congress to pass two complimentary measures: the SHOP SAFE Act and the INFORM Consumers Act.”