N41 Web Blog MAR 01

Mitigating Supply Chain Disruptions in Fashion with ERP

Despite experiencing these issues, more than half of fashion executives said they plan to raise their prices. Is this a smart move in a world that sees consumers already pinching their pennies? Time will tell, but if you want to better position your fashion company, it’s critically important to switch to an ERP. In fact, using ERP systems such as N41 is one of the best ways to take better control of your inventory management, giving you a much better chance at making a notable splash in the fashion industry.

Understanding Supply Chain Disruptions in Fashion

There are several different reasons the supply chain can become disrupted. For example, a natural disaster could massively back up the supply chain, which could cause small businesses to lose a fortune. Geopolitical tension is another hotspot, along with production being halted as workers seek higher wages. Of course, one of the most significant modern disruptions was the COVID-19 pandemic, and it proved that no industry is truly prepared to deal with anything more than a very minor blip in the supply chain.

When these things happen, it drives prices upward. In turn, customers become more dissatisfied and, in some cases, will cancel their orders due to delivery delays. This creates an even bigger problem for the industry, and it can be quite challenging to get things back on track.

Let’s look at the pandemic’s overall effect on the fashion industry. It practically brought the fashion world to its knees as spending halted almost immediately. Even as the world began to recover, people decided to change how they dressed. Comfort became king, and any designers who made sweatpants were much better positioned than those who made business wear. The worst part? No fashion industry experts could see it coming, and many of the outfits they offered for sale had been planned up to two years in advance. This certainly was not a good way to do any pandemic holiday planning!

The Role of ERP in Mitigating Supply Chain Disruptions

Enterprise resource planning (ERP) can go a long way toward mitigating any unforeseen supply chain disruptions. It helps with four major components:

  • Planning
  • Procurement
  • Production
  • Distribution

Each of the preceding is needed to ensure that everything goes as smoothly as possible. Perhaps the most important thing ERP does is store every piece of business data within a single database. This allows you to get a unified view of your supply chain, providing better visibility and greater control.

Additionally, using an ERP provides three major benefits:

  • Forecasting
  • Inventory management
  • Risk management

Each component is essential, and you’ll find them much easier to accomplish with an ERP.

Key Features of ERP for Fashion Supply Chain Management

Digging a bit deeper into ERP helps highlight even more benefits. One example is that access to real-time data analytics makes optimizing your inventory and forecasting demand easier.

A less expected—but equally important—thing about ERP is how it can help improve your supplier relationships. After all, who will your supplier ensure receives their materials during a shortage? Be sure to utilize this supply chain resilience to improve your customer satisfaction rate! Even better, having a good relationship positions you to negotiate better terms for your company.

Using an ERP means efficient resource utilization too, through the usage of production planning and scheduling. Finally, you’ll also be able to better overcome delivery challenges through transportation management and logistics.

Implementing ERP Solutions in the Fashion Industry

Adopting an ERP can solve many of the fashion industry’s problems. First, though, you must select the right ERP for your specific company. Consider the following when it’s time to select your ERP:

  • Assessment of needs
  • Vendor evaluation
  • Customization requirements

You’ll also want to choose an ERP partner that knows and understands the fashion industry, such as N41. After you’ve selected an ERP, you can have the smoothest implementation process by focusing on:

  • Project management
  • Training
  • Change management
  • Clearly defined project scope

Also, you’ll want to select an ERP that can easily integrate with your existing systems and technologies, including eCommerce platforms, CRM, IoT devices, etc.

Challenges and Considerations

Using an ERP can allow you to transform your business. However, as with anything else, the switch has pros and cons. Some potential issues you’ll need to watch out for include:

  • Price
  • Complexity
  • Employee resistance
  • Ensuring data security
  • Ensuring compliance

It will also be important to remember that an ERP isn’t a ‘do it and forget it’ solution. Instead, you’ll need to continuously evaluate and adjust your ERP system to match changing fashion trends. You’d have to make adjustments either way, though, and an ERP makes it much, much easier overall.

Case Studies and Success Stories

Levi Strauss & Co. provides the perfect ERP case study. They decided to switch their China-Hong Kong division to an ERP in the hopes of speeding up the entire process without harming employee relations. This process worked better than they could have dreamed, and it helped mitigate supply chain disruptions.

Numero Uno also provides a case study for a successful ERP implementation. They wanted to revamp their digital landscape and improve revenue. ERP allowed them to do both things and speed up their supply chain. All in all, their adoption of an ERP was a complete success!

What benefits did Levi Strauss & Co. and Numero Uno experience?

  • Improved efficiency
  • Cost savings
  • Enhanced customer satisfaction
  • Better supply chain results

Elevate Your Market Response with an ERP System

Mitigating supply chain disruptions is one of the most vital tasks of the fashion industry, and it requires an efficient market response. Using an ERP has proven successful at doing this and offers companies many other benefits. Some of the top solutions that an ERP can provide include:

  • Increased productivity
  • Reduced costs
  • Supply chain management
  • Inventory management
  • Improved customer satisfaction

As the fashion industry continues to evolve with the rest of the world, using an ERP will become even more important. After all, there are more choices now than ever before, so if you want your fashion business to stand out, you’ll need all the help you can get.

N41 is America’s leading fashion and apparel ERP solution provider. We have a 99% customer retention rate and 16+ years of industry experience. Schedule your free demo today!

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