The Way To Solve The Backlog Of Clothing

The stock is mercilessly devouring the profits of enterprises. How can we solve the problem of overstock and raise the turnover of cash flow?

Related reports show that Beijing Olympic sponsor Adidas currently has a backlog value of 1 billion yuan, 250 million yuan ~3 for Heng Yuanxiang and 120 million ~1.6 billion for AOKANG.

It is also reported that the new brand "ME&CITY" launched by the United States in the first quarter of 2009 has dropped to 30%, and the inventory is serious. So we have to readjust our strategy to trigger a series of measures such as layoffs and channel adjustment.

In fact, the inventory problem has been in the clothing industry for a long time, but it is especially prominent in this year's market environment.

The stock is ruthlessly engulfing the profits of enterprises, making a batch of garment enterprises fall down, and also makes the overall operation cost of the apparel industry remain high, and it will perplex the industry for a long time.

Today, as cash is king, how to improve cash flow turnover and solve inventory pressure is the most urgent problem for domestic apparel enterprises.

　　服装企业的供应链管理 

　　服装企业的库存问题集中体现在供应链的管理方面，对于服装行业的库存问题来说，促销只能祛邪治标，而供应链的优化管理则可以扶正治本。供应链管理是一种物流、信息流、资金流集成的管理思想和方法，其出发点是高度关注客户的实际需求，在供应链节点上的各相关部门充分发挥各自的核心能力，形成优势互补、信息共享。 

　　企业供应链的外部问题 

　　由于服装行业的特殊性，除了雅戈尔等少数大型企业外，绝大多数服装企业的面辅料资源必须从上游供应商获得，这就导致中国服装企业外部的供应链面临两个方面的问题。 

1. the apparel supply chain management of China's apparel industry has not studied the supply chain problems, nor has information sharing, nor has there been any standardized mechanism to constrain the supply chain, according to which criteria, it should provide information for the supply chain according to its criteria, and assist the upstream and downstream enterprises to complete the efficient and smooth connection, resulting in an increase in the inventory level of the entire supply chain.

2., the supply chain members of the garment industry are extruding each other, including the downstream upstream and the strong side squeezing the weak side. This kind of extrusion is not only manifested in inventory, but also in terms of price, cost and risk, resulting in the squeeze of profit and living space.

　　企业供应链的内部问题 

　　1．企业内部缺乏对供应链库存控制的认识。企业内部供应链库存思想有赖于企业最高领导决策者，中国服装企业的最高决策者虽然关注库存，却没能将供应链管理提高到战略层面的高度。当今中国服装市场竞争惨烈，服装企业面临的竞争对手可能不只是一个经营单位，而是一个集团军，仅靠企业自身的资源不可能充分有效地参与竞争，还必须把经营过程中的有关各方供应商、制造商、分销网络、客户纳入一个紧密的供应链中，才能高效地运作企业的经营行为。 

2. the internal organization and management system of clothing enterprises impede the operation and control of supply chain.

There is such a phenomenon in China's clothing enterprises: when a certain type of clothing products produce inventories, the departments of design, production and marketing are buck passing each other, and their responsibilities are unclear.

There are three types of internal supply chain organization and management in China's clothing enterprises.

The first category: large garment enterprises

The clothing enterprises have their own core supply chain management departments, and their internal inventory control conditions are relatively advanced.

For example, the second generation MBSRP supply chain information integration system made by the United States, which has already covered suppliers, third party logistics enterprises, franchisees and direct store terminals, as well as various departments of the company headquarters, has functionally included the usual functions of enterprise resource management, supply chain management, procurement resource management, distribution resource management, customer relationship management, shop resource management and POS system management.

The average stock turnover time of the system is 71 days, while the average daily turnover of Chinese clothing is 185 days, ZARA and HM are about 30~50 days.

The second category: large and medium-sized garment enterprises

This clothing enterprise has the sense of supply chain management, and has its own supply chain management department (enterprise, also known as logistics department, commodity management department), but does not have unified and coordinated management capability of logistics, information flow and capital flow of the entire enterprise.

The inventory management of such clothing enterprises usually relies on reasonable distribution of goods (goods structure, style and quantity of goods), cross section of goods between regions and regions, pshipment of goods between shops and shops, timely replenishment (shops replenish goods to the company, suppliers unable to replenish goods), and channel promotion and other means to control inventory.

The third category: small and medium-sized garment enterprises.

The clothing enterprises do not have independent supply chain management departments. Usually, the design department is responsible for R & D, procurement department responsible for the purchase of accessories and garments, warehouses for shipment, marketing departments responsible for sales, various departments of enterprises do their own affairs, do not contact each other, and the internal information of enterprises is seriously disconnected.

Such clothing enterprises often increase their inventory with the increasing number of enterprises.

　　供应链优化的解决方案 

　　在信息经济时代，服装企业实现供应链优化的根本途径在于实现信息透明化，打破信息不对称所带来的种种弊端。库存问题除了要加强商品企划与设计、尽可能地提高滚动预测准确率之外，另一方面还要加快整个供应链的响应速度以适应市场变化，减少服装库存实际上等同于少生产不适销对路的产品。国内服装品牌目前预估生产的比例普遍在45％?60％，比较优秀的企业在35%左右，而行业标杆ZARA这一数字为15％? 20％。基于供应链优化的服装库存问题解决主要从以下两方面考虑。 

　　模型优化 

　　目前服装行业内已经提出的多种供应链优化模型中，比较典型的是由韩永生教授提出的“喝酒模型”。该模型认为，要想同时实现高顾客满意率和低库存，需要做到以下几点。 

First, the products produced by enterprises should adopt different strategies according to different location, total sales volume, season, location of network and traffic volume.

Second, enterprises should set up a distribution and retail management system or data warehouse, accurately, timely and completely understand the sales and inventory situation across the country, so that the sales data is pparent, and then the computer system gives advice on replenishment, goods pfer and return, and then determines the delivery volume by HCI.

Third, because many enterprises only examine sales and profits and do not check the stock index, resulting in the ordering of stores and branches, because they are worried that the best sellers can not fill the goods, ordering more can be ordered or refunded, which directly leads to the gradual amplification of demand information in the supply chain and the "bullwhip effect".

The solution is that the distribution center should be unified distribution according to the sales and inventory of each location, and implement VMI Vendor Managed Inventory.

Fourth, the distribution center will adjust in time according to the sales and stock situation of each outlets, so that some outlets will be sold out, while some outlets will have high inventory.

In addition, in order to reduce pportation costs and time, central stores are used to buffer the distribution of satellite stores around.

Fifth, the product sold to the end of the season, a small number of broken, broken code products focused on discount sales, in order to achieve zero inventory.

There are some limitations in adopting VMI inventory management mode.

For example, a high degree of dependence on suppliers, high requirements, and requires a high degree of trust.

In the decision-making process, the lack of adequate upstream and downstream consultations will increase supplier risk.

VMI mode is more suitable for enterprises such as YOUNGOR, which have a high degree of centralized system and a higher proportion of direct channel.

In the aspect of current inventory management mode, it is tending to develop the joint inventory management mode of upstream and downstream power liability balance and risk sharing, as well as the direction of collaborative planning CPFR inventory management mode.

Joint inventory management emphasizes the simultaneous participation of all nodes in the supply chain, and jointly formulates the inventory plan, so that each inventory manager in the supply chain process considers from the coordination of each other, and maintains the inventory managers' expectations of demand among the nodes in the supply chain, thus eliminating the phenomenon of demand variation amplification.

The determination of the demand of any adjacent nodes is the result of the coordination between supply and demand sides. Inventory management is no longer a separate operation process, but a link and Coordination Center for supply and demand connection.

CPFR is facing the cooperation of the entire supply chain. It can improve the relationship between suppliers and buyers by improving the accuracy of the business, and improving efficiency and reducing inventory by CO managing the business process and sharing information.

In addition, in order to optimize the overall function of the supply chain, we need the coordinated development and integrated management of the functions of the subsystems in the supply chain, from the collection and use of information, from the formulation of the strategy to the implementation, from the organizational culture change to the organizational structure adjustment.

For example, the US VF company, which owns Riders, Rustler and Lee brands, has a spot supply rate of 90%, while its competitors only have 50%? 70%.

This is attributed to the integrated logistics system established by VF. For example, in WAL-MART store, VF computer tracks every pair of jeans on the rack. When a pair of jeans passes through WAL-MART's cash register, its UPC tags are scanned, and the computer logistics system of VF immediately sends out information. After a few hours, the same jeans will be sent from the factory. Meanwhile, the order sheet determined according to the sales status is sent to the supplier of the VF through satellite communication every day. These suppliers immediately begin to prepare materials and arrange supply, so that the whole logistics system can run continuously and meet customer's needs without interruption.

In order to realize the full pparency and convenience of information in the supply chain process, the application of IT technology is a necessary guarantee.

Take the application of RFID (Radio Frequency Identification RFID) technology as an example.

RFID is a non-contact automatic identification technology, which can automatically extract and identify information carried by the identified objects, and is widely used in different business environments and scenes.

Because of the large number of inventory management units and complex logistics management, the apparel industry is currently one of the most suitable industries to apply RFID technology. Data show that RFID's latest practice in garment industry has achieved a series of results.

In the use of clothing terminal stores, the "smart fitting mirror" and "intelligent fitting room" developed by the Department of textile and clothing of Hong Kong Polytech University and the RFID inventory management system of Martha, UK, have been developed successfully.

The "smart fitting mirror" uses the RFID technology to hang the special tag on each garment, and provides personal dress matching guidance while the customer tries out.

As long as the clothing goes to the mirror, the customer will immediately feel the clothes. The screen set up on the side will show the collocation suggestions, matching types, colors and prices.

The "smart fitting room" is equipped with a screen to provide guidance for customers. Customers can call the reception desk when they pick the right matching clothing. The waiter will take the relevant clothing according to the synchronization screen and the guide on the counter screen.

This avoids the cumbersome process that customers enter and exchange clothes in the fitting room, and avoids the customers' resentment because the waiter is too active.

The "smart fitting mirror" also helps retailers to get the latest sales and customer preferences and obtain valuable, systematic and original first-hand market information.

The tags used by Martha each have a unique code, plus the UPC number of the tag, to form a linked database. Then the data of the database are sent to Martha department store and the tag is handed to the manufacturer.

When the goods are delivered to the warehouse with RFID readers, all the product data can be connected to the database. Martha's employees hold the RFID intelligent reader (reading distance of 70 cm) to read each tag and the unique code. The database of the system matches each ID number with the color, type and size of the marked commodity.

In this way, employees can calculate the inventory in the store through the RFID reader. When the inventory in the store is less than the expected level, they can instantly know the kinds of clothes that are missing and replenish the supply immediately, so as to improve the efficiency and facilitate the rational allocation of the goods between the same brand stores. As a result, the sales situation is rising, and the trouble of ordering customers due to shortage is reduced.

RFID's application in clothing logistics, Austria third party logistics company Jbstl Warehousing & Fashion uses RFID system to track clothing goods pported to retail stores, and has achieved remarkable results.

There are about 35 freight boxes shipped from Jbstl logistics company every day, and there is an active RFID tag on each cargo box. Jbstl installed 3 access points on the building of the company's distribution center to receive signals from RFID tags. After receiving the signals, the system pmitted the unique code on each label to the company's system.

The application of RFID technology has realized the full visualization of Vgele closed loop supply chain, optimized the operation process between freight boxes in European retail stores, improved garment throughput, reduced inventory, improved customer service quality and shortened turnover time of orders and cash.

In addition, the RFID system also has many functions, such as reducing shop theft, anti-counterfeiting products, preventing goods exchange, quick settlement of stores, VIP member management and multimedia clothing display.

With the increasingly fierce competition in the industry and the increasing demand of consumers for clothing fashion, higher requirements for the fast response ability of garment enterprises have been put forward. Clothing enterprises should carefully conceive and organize the supply chain, and focus on the warehousing, logistics and information management system, because supply chain management capability has become one of the core competitiveness of garment enterprises.