Responding to market shifts relentlessly pressures apparel retailers. In turn, they push multinational trading companies to improve coordination among themselves and apparel makers. By planning collections closer to the selling season, testing the market, placing smaller initial orders, and reordering more frequently, retailers can reduce forecasting errors and inventory risks. The final links and markets and Customer. Although tastes overlap among countries, local customer preferences traditionally vary. For example, the british seek stores based on class sensitivities, Germans are shoppers in the United States look for a mix of variety, quality, and price. Collectively, these conditions create a buyer-driven chain that links fragmented factories, global brokers, dispersed retailers, and local customer.
Industry wisdom spurred firms to choose a sliver of a particular activity make zippers manage logistics focus on store design, cater to customer segments instead of creating value across multiple silver. Effectively, “Do what you do best and outsource the rest” drove strategy. Globalization reset the game board. Fewer barriers logistics, and improving communications created new industry standards and strategic choices.
A compelling example is the compression of cycle time in the apparel buyer chain (see Figure 12.1) in the 1970, getting a garment form factory to customer took approximately nine months six to design the collection and another three to make and ship it. Now, it takers the typical company from six months down to six weeks to run this cycle. For a firm named Zara, it take between two to four weeks. By rejecting conventional standards, Zara implemented disruptive innovations that reset the relationship among industry structure, company strategy, and value creation. In the process, it became the world’s leading apparel company and its founder, Amancio Ortega, one of the world’s wealthiest people.