Fashion is a significant and growing industry which should be on the radar screens of every transport company fleet manager looking for new business opportunities. Management consultants McKinsey in their December 2016 “The state of fashion” report estimate that the worldwide market is worth $2.4 trillion dollars with an annual growth rate of 5.5% over the previous decade.
There are several reasons why fleet managers should be investigating trailer flexibility to enable them to increase load-carrying to handle spikes in fashion industry demand.
The fashion industry is well-known for seasonality and fluctuations in supply and demand. Traditionally, the sales cycle was very regimented with two major seasons Spring/Summer and Autumn/Winter. The high fashion designers would launch their new collections at catwalk shows in Paris, Milan, London or New York in February for their autumn/winter wear and in June for their spring/summer collections with the clothes for sale in stores four to five months later. Typically, retailers sell clothes for hot weather when cold and vice-versa.
A changing sales cycle
However, this cycle has changed with the rise in popularity of “fast fashion” retailers like Zara who are delivering new clothes collections constantly and introduce clothes whose design has been inspired by high fashion items soonafter they have appeared on the catwalks. In addition, social media is providing an alternative to the catwalks for promoting fashion. Consequently, high fashion brands such as Burberry and Tom Ford are now making their clothes available immediately after their fashion shows. Some fashion houses have also been moving away from the bi-annual launches to presenting “capsule collections” to arrive in stores during the quiet months between summer and winter. This has created new challenges for designers, manufacturers and retailers as they redesign their supply chains. All this change including more frequent and fluctuating deliveries is leading to new opportunities for those transport companies which can provide trailer flexibility.
The rise of “fast fashion”
The explosion of “fast fashion” practiced by companies including Inditex, owner of Zara, the world’s largest fashion company, H&M, Uniqlo and Primark has changed the rules of the fashion game. Fast fashion demands supply chain elasticity and trailer flexibility to quickly deliver not only low-cost clothes collections, influenced by the catwalks as well as their own “value-for-money” collections throughout the year. [Source: Fortune magazine]
Clara Lu of Tradegecko attributes Inditex’s success to controlling a greater part of its manufacturing and supply chain than its competitors. This enables it to take a clothes design from drawing to store in two weeks [Source: Tradegecko blog]. This is in stark contrast to the “up to six months” needed by a “traditional clothing manufacturer” like GAP [Source: Business Insider].
Repatriating manufacturing to Europe
Some fashion companies are repatriating their production to Europe. In March 2017, a Reuters article reported H&M’s decreased quarterly profits and mentioned that H&M’s supply chain lead-times were around double those at Inditex. H&M put its decrease in profits down to manufacturing too much of its clothing in low-cost Asia. This meant frequent delays in getting products into its stores and too much inventory. Its solution is to bring back more of its manufacturing to Europe, enabling it to supply its large base of European customers more quickly, flexibly and efficiently. With other fashion manufacturers likely to follow H&M’s lead, this could be another opportunity for transporters with trailer flexibility.
To capitalise on the new business opportunities in the fashion industry through trailer flexibility and scalable load-carrying capacity, please contact TIP Trailer Services via this form.
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Flexibility through trailer rental
Trailer rental is a powerful and flexible solution that enables truck fleet owners to take advantage of fluctuating demand. Trailer rental can give you access to the best trailers and latest trailer technology without the high investment costs and overheads of ownership.
Customers choosing to rent trailers through TIP Trailer Services can take advantage of preferential rental terms within lease contracts to take on more trailers or reduce the number as demand requires.
All types of trailers
TIP hires out trailers for every task including curtainsiders/tilt, moving/walking floor, flat, reefer, tanker, chemical, tipping powder, powder waste and many other types of trailers as well as trucks.
Trailer maintenance and repair – outsource them
As part of a trailer rental contract, TIP Trailer Services takes the weight off your shoulders by providing you with maintenance and repair management services. Whilst we look after the maintenance and repair of your rental trailers, we supply you with alternatives to ensure that your business continues to operate as usual.
Should one of the trailers in your rental fleet require roadside assistance on the way to Rotterdam, Frankfurt, Madrid or any other European destinations, you can count on our Europe-wide breakdown recovery service 24/7 365 days per year.