How to increase merchandisers's process efficiency to boost profitiability

How Next-Generation Merchandising Teams are Embracing Speed to Market


The fashion industry and fragmentation go hand in hand. There’s an assortment of geographies, collaborators, product categories, collections, seasons and suppliers. Its history is one of being disjointed, clunky and slow to adapt. It’s only now that the industry is beginning to recognize the need to streamline, connect and change the way it conducts business.

In fact, over the past decade, the top 20 percent of fashion companies have delivered all of the industry’s economic profit. McKinsey attributes their success to the ability to navigate different categories, channels and consumer shifts, operate core functions better than their underperforming peers and prioritizing speed to market.

The New Consumer

The transformation of the market has changed the landscape of fashion forever. Consumers are savvier, more demanding and looking for instant gratification, which means product cycles are shortening, and there are more collections to satisfy the need for newness.

Fast-fashion leaders were first to test and experiment with this new model. Companies like H&M, Zara and Topshop are producing runway-inspired pieces and selling them in stores in weeks – versus months – and their speed to market has been recognized and rewarded by fashion-loving consumers. According to McKinsey, revenues for these early adopters rose 8.2 percent in aggregate in 2017, compared to overall retail growth of about 3.5 percent in the same period.

There’s a lot to be learned from this new business model, and every fashion organization – regardless of market or reach – can expand its thinking and approach that will allow everyone to embody a fast-fashion mindset. In an article from McKinsey, it noted that this model is feasible for the long-term, but fashion organizations have to be “willing to embark on a dramatic transformation of their processes and mind-sets. Shortening the fashion cycle isn’t a quick-fix undertaking.”

Merchandising Takes on a Major Responsibility

In order to rise to the occasion, merchandising directors are taking a deep look at internal processes and finding ways for their teams to increase efficiency, better collaborate and topple departmental silos that are all too common.

A McKinsey survey reported that merchandising teams spend nearly two-thirds of their time “gathering data, managing exceptions, ‘firefighting’ and participating in meetings to syndicate with colleagues.” Imagine if 28 hours a week were gained back for making decisions on collections, cost analysis, delivery options and sales projections for a profitable season. Alternatively, imagine continuing to waste a significant amount of time each week finding and gathering data, delivering it to the proper destination in the supply chain, only to find out the information was inaccurate or outdated. The delays and missed opportunity would be unfortunate, but all too common.

Three Areas for Merchandising Team Exploration

Next-generation merchandising leaders are uncovering where their teams spend time, and cutting down on non-value added activities. After all, increasing productivity is key 

to increasing profitability. Since merchandising is at the heart of getting products to market faster, merchandising leaders are digging deep into fashion lifecycle.

As leaders re-evaluate their team’s ability to get to market fast, they’re considering the following approaches.

Breaking down the fashion cycle. By creating a roadmap for the typical time to get through each phase, and the setbacks encountered that cause delays or increased costs, leaders are able to identify time-wasting activities and pinpoint the greatest areas for improvement.

Revisiting the planning process. Because the initial phase of planning, design and development is typically the longest, it has the most opportunity for improvement. Digital tools are helping teams efficiently capture inspiration, share designs and collaborate on feedback to keep the development process humming along at a good pace.

  • Did you know? Top-performing fashion organizations are delivering products to market in less than six to eight weeks, while the typical industry lead time is more than 40 weeks.

Streamlining supplier communication. Manufacturing partners need clear lines of communication, documentation and clear understanding of the job to prevent wasted time or rework. Automating supplier communication can increase accountability for hitting milestones and delivering quality products.

Increased Engagement Leads to Greater Productivity

Today, all fashion is fast fashion, and merchandising has an incredible opportunity to reshape the way their organizations go to market. If it’s broken, it’s time for a fix. Perhaps systems are broken, time is wasted searching for insights, or leaders are so bogged down in the details that they can’t see the forest for the trees.

By taking a hard look at the way your team goes about efficiency, it’s possible to not only change the dynamics and output of your team, but its overall sense of excitement and well-being. Employees are happier when they spend more time problem-solving versus just trying to keep up. And happier employees make for a more creative, productive environment. And that’s just what you need today, because speed to market is here to stay.

To learn more about how your team can increase efficiency and evaluate their performance for a better tomorrow, download our eBook, “Evaluating Efficiency: 3 Areas to Assess for Merchandising Team Effectiveness.



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