1. Chapter 3: Sourcing in Fashion Supply Chains
Fashion Supply Chain Management

2. Flow of a Fashion Supply Chain
Manufacturing
Retailing
Supplier
Retailer (Buyer)
Customers
- Produce products
Fashion brand owner
Fashion design
Place order
-Purchase
Company name-Presentation

3. Sourcing Decisions in a Fashion Supply Chain
Sources of cost: flows of information, products, or funds between stages of the logistics movement
Product
Information
Supplier
Buyer
Payment

4. Product Sourcing decisions in a supply chain Basic item
Fashionable item
- Trendy
- Follow taste of customer
- Customer may dislike it tomorrow
- Not designable
Every customer needs it today and tomorrow

5. Information Supply information Demand information Information sharing
Manufacturing
Retailing
Supplier
Retailer (Buyer)
Supply information
Labor efficiency
Machinery condition
Production capacity
Demand information
Consumer taste
Market condition
Fashion trend
Information sharing

6. Information Supply information Demand information Information sharing
Manufacturing
Retailing
Supplier
Retailer (Buyer)
Information sharing
Company name-Presentation

7. Payment 1 2 3 Retailer (Buyer) Pay in advance
Pay when the product is arrived
Pay after the product is sold
Supplier
Supplier has healthy cash flow
Retailer has healthy cash flow
Click to add your text here
Company name-Presentation

8. Pay when the product is arrived Pay after the product is sold
Payment 1 2 3
Retailer (Buyer)
Pay in advance
Pay when the product is arrived
Pay after the product is sold
Supplier
Click to add your text here
Click to add your text here
Company name-Presentation

9. Objectives of Sourcing Management In Fashion Supply Chains
Sourcing management aims at an efficient and effective management of flows between and among supply chain stages to maximize total chain profitability.
Manufacturing
Retailing
Supplier
Retailer (Buyer)
Customers
Total chain profitability

10. Adidas: A famous sportswear retailer
Case Study
Shenzhou: A knitwear manufacturer in Ningbo, Zhejiang
Outsource
Adidas: A famous sportswear retailer

11. Case Study Shenzhou’s customers
According to the China Knitting Industry Association, Shenzhou ranked first in terms of profit before taxation and second in terms of sales among China’s knitwear manufacturers

12. Questions: why Shenzhou can be so successful
Shenzhou is not only an apparel manufacturer, but also provides many services such as design.
Design Innovation
Manufacturing
Retailing
Adidas
Shenzhou
Customers
Competitive advantage:
Provision of design innovation service -> pay more and pay earlier
Shenzhou is a full package supplier

13. Summary – what do we learn from this class?
Products, payment, and information in sourcing decisions.
Products can be categorized into basic and fashionable items.
Information can be categorized into supply information and demand information.
Payment can be categorized into pay-in-advance, pay when the products are arrived, and pay after the products are sold.
Find the internal relationship among products, payment, and information
Shenzhou’s example on sourcing management

14. Extra Reading After Class
Design Outsourcing in Fashion Supply Chain: OEM v.s. ODM, Journal of the Operational Research Society. 67, , 2015.