Fashion and apparel reinvent themselves
If the fashion and apparel industry were a country, its value would be equivalent to the seventh largest economy in the world. China, the United States and Europe are still leading in sales, but consumption continues to rise in developing countries, with implications in terms of styles, size and fit.
In terms of volume, over half of all garment sold in 2016 were in the Asia Pacific region. This area is set to see sales rise to $491 billion in 2016 and $606 billion by 2020, representing 37% of the global market’s value. Between 2010 and 2020, sales are expected to rise by 85% in Asia Pacific, 31% in North America, and 10% in Western Europe. Segments showing the strongest growth will be sportswear, fast fashion and affordable luxury. Global production should reach over 129 billion units by 2018, reflecting constant growth in demand.
How fashion is designed, developed, produced and consumed continues to evolve. From now on, the consumer is an integral part of the value chain within this profoundly changing industry.In order to differentiate and improve profitability, brands are focusing on creativity, fit and the accelerated renewal of collections. Their success is rooted in data exploitation and analysis. Manufacturers are increasingly expanding their activities, engaging in the personalization of garments or developing their own brands. With a keen eye on the objectives for their margins, they are streamlining processes and improving cost control. Like manufacturers, more and more retailers are developing their own brands.
Due to a soaring domestic market, a rise in production costs, and the Made in China 2025 initiative, China has gone beyond its role as the world’s factory, accelerating the country’s industrial upscaling. While western brands still turn to China for their supplies, near sourcing is grabbing an increasing share. Chinese apparel giants are relocating their production to low-cost regions – continental China, South-East Asia, Africa… – and developing their own brands. Not only are Chinese consumers buying more, they are increasingly loyal to brands. In terms of quality these consumers are more demanding and even favor personalization.
Around the world, the Millennial generation must be taken into account. Growing up in the digital and social media age, they have expectations – quality, price, personalization, social and environmental responsibility, delivery times – that are forcing supply chains to become more agile. With rising market pressures, notably from the growth in Internet sales, companies must transform themselves to directly engage in the digital era.
Collaborative platforms have become a necessity. By enhancing teamwork with both internal and external partners, these platforms facilitate and accelerate product design and development. A rise in labor costs, combined with trends like customized garments, mean automated production lines are essential. Smart machines not only help manufacturers to lock into place uninterrupted production, with few operators, they can also take into account individual consumer preferences. Crucially, data flows and analysis at the heart of Industry 4.0 factories ensure production is tightly integrated along the entire value chain.
Drafted by the Chinese Ministry of Industry and Information Technology (MIIT) with the aim to modernize the country’s industry, the Made in China 2025 initiative is encouraging Chinese companies towards adopting innovative and high-performing solutions. This initiative is fast propelling the Chinese economy towards smart, value-added manufacturing.
Galeries Lafayette aims to increase their own brands from 6% of total revenues today to 10% by 2020. In December 2016, they launched the first collection for their new own brand. With the aim to affirm a style identity founded on simple, expertly-designed shapes – the effortless chic of the French – Galeries Lafayette’s team looked for a solution most suited to increase the performance of product design and lifecycle management processes.
US-based global performance brand Under Armour inaugurated the UA Lighthouse, a new facility for design and manufacturing in Baltimore, United States, on June 28, 2016. The company chose Lectra as their exclusive partner for the cutting room at the UA Lighthouse. By adopting the most advances technology, this incubator aims to promote manufacturing best practices and to develop efficient production methods.
La Moda grew so quickly that the company developed without putting proper processes into place. The company needed to update its cutting room to keep up with the increase in business. It needed to keep production fast and cost-effective, while maintaining the high quality standards and originality in design that set it apart from other brands in the market.
(2016 Annual Report)