Why ERP is critical to the fashion industry



As fashion retailers we are involved in one of the most logistically complex industries. Clothing retail has much shorter product lifecycles in comparison to other sectors, and the pace of change in demand is significantly higher. Each season a whole new collection is produced and in recent years this has moved to quarterly refreshes and fast fashion lines.


We are challenged by keeping track of merchandise (that ranges in style, size, fabric, and colour-way), whilst anticipating demand, forecasting sales, reducing delivery times and minimizing unplanned markdowns.


The need to assess manufacturing costs, sorting and extracting styles to be produced makes managing the end-to-end process incredibly complex. Being able to handle all this information in one system means more efficient and accurate business decisions can be made thanks to ERP software.


The Transformation of Retail


Which ERP? summarized the highlights of a survey conducted on behalf of JDA, PWC and Forbes covering 53% of retailers from the global 1,000. The survey sampled 409 retail CEOs across 8 countries, and the findings were presented at the NRF conference:

  • Pace of Change is accelerating: with more change coming in the next 5 years than the last 50 years driven by both technology and consumer demands.

  • Omni-Channel is king: where once we talked about channelization we now focus on a seamless transition across all channels something that challenges even big retailers like John Lewis.

  • Consumers are always shopping fashion: It is a leisure pursuit and can be undertaken on mobile phones whilst sitting on the daily commute. Every website is mobile optimized ready to take orders at any time of the night or day. Real-time inventory of worldwide stock is critical to fulfil customer demand.

  • Customer Retention is key: Putting the customer at the heart of an organization will result in a more targeted offer that will keep consumers loyal.

  • Cost Control: the top concerns were reported to be margin erosion, retaining customers and competitive threats. As a result, it is clear that the pressure on cost control is not going away any time soon.

As such, it is clear from this that ERP software can do much to ease the effects of new challenges to the fashion and clothing retailer in the online age. Particularly in relation to cost control and efficiency, ERP offers a real and tangible solution.


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K3 Business Technologies | Gildeweg 9c, 2632 BD Nootdorp, The Netherlands | +31 (0) 15 251 6555 | info.k3software@k3btg.com

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