IT designed to suit garment manufacturing supply chains
These are exciting times for UK garment manufacturers – if they embrace digitalisation, writes Karl H. Lauri, managing team member at MRPeasy.com.
Significant changes are under way in the garment and apparel manufacturing industry. In many cases they are both driving and being driven by digitalisation in the sector. If the UK’s many smaller garment manufacturers are to treat these changes as opportunities rather than threats, they need to become part of the emerging digital ecosystem, and the entry level foundation for that is a competent ERP/MRP system.
There are almost 4,000 UK enterprises manufacturing wearing apparel, and 99.7% of these count as SMEs. There are of course further companies in the related fields of textile production, footwear, accessories, not to mention a small army of unincorporated individuals ranging from high-end designers and their networks of artisan makers to the many, often exploited, out- and home- workers. Manufactures range from fashion to workwear, and the factory may be the atelier of a couture house, or a contract manufacturer for retailers and brands. UK companies booked sales of £1.6 billion, at factory gate prices, in 2019 whereas the retail value of UK apparel sales is north of £50 billion. That partly reflects the dominance of cheap, and sometimes ethically dubious, imports in the mass market but also suggests that UK firms are failing to capture as much of the value chain as they could. If they can exploit the emerging trends, UK firms could improve their share significantly.
The ethical and environmental concerns of consumers, increased geo-political trade friction, the post-pandemic emphasis by brands and retailers on supply chain resilience, and rising costs in ‘cheap’ source markets are fuelling some degree of reshoring of manufacture, and a greater appetite by consumers for the local, natural, ethical and ‘authentic’. Fast, throwaway, bulk fashion is less desirable or acceptable. Such shifts do not have to be massive to transform prospects for many small producers.
An ERP/MRP base is essential for firms to interact meaningfully with their customers’ B2B web portal, EDI and other systems, and to support any digital D2C business they may develop. How else can the firm make that price and delivery promise in real time? Not every garment manufacturer is immediately faced with the prospect of robotic sewing, unique single consumer designs, or the application of blockchain or predictive analytics, but they all need to book their place in this increasingly digital environment.
ERP/MRP itself does not, of course, deliver digitalisation, but it is a necessary precondition. It establishes a single source of truth, it allows the effective co-ordination of a complex supply chain. including outworkers, with real-time planning and scheduling. It enables effective response to rapidly changing demand and crucially, gives visibility into whether activities and contracts are actually profitable. A well set up system also allows two-way, largely automated, communication with customers and suppliers, taking time, cost and error out of business processes. It is the basis for the verification and audit procedures that customers and consumers are increasingly demanding. It also provides the backbone on which other, more advanced, technologies can in time be mounted.
Cloud-based, Software-as-a-Service ERP/MRP systems such as those from MRPEasy, are now eminently affordable. There are low initial costs for capital equipment, training and implementation, and they are fully scaleable both in functions used and in number of users.