Assignment No.

01
Submitted to
Sir. Kursheed

Submitted by
Junaid Ali Murtaza
17-ARID-4888
MBA 1.5 Evening
Background

This research addresses current supply chains specific to the apparel industry in the United States. Within
the apparel industry, we focus on apparel companies that sell products to consumers that sell to retailers in
the United States. We identify the fundamental corporate strategies, the operational models and the best
supply chain processes that are important to maintain a competitive position in the current clothing supply
chains.

This study is part of the MIT Supply Chain 2020 Project (SC2020). The goal of the SC2020 project is to
identify and analyze the factors that are crucial to the success of future supply chains through the year
2020. Phase I of this industry-wide research initiative involves nine different industries and twenty-one
different case studies within these industries.

In the 1990s, Gereffi and colleagues developed a framework called "global commodity chains" (Gereffi,
1994, 1999) also called "global value chain" (Gereffi and Memedovic, 2003), which links the concept of
the chain of added value directly with the global organization of industries (Gereffi and Korzeniewicz,
1994). In this article, the value chain is defined as the range of activities involved in the design,
production and marketing of a product. The work of Gereffi et al highlights the growing importance of
new global buyers (mainly retailers and brand marketers) as key drivers in the formation of fragmented
production and distribution networks worldwide and organizationally fragmented and also highlights the
importance of coordination beyond the limits of the company.

This investigation is divided into three parts. The first part studies the general supply chain of the clothing
industry, from the manufacture and supply of clothing to the distribution and sale of clothing. We present
several challenges and opportunities of the supply chain within these individual activity silos.

The second part involves a case study of Limited Brands. We discuss the positioning of this company
within the clothing industry. We provide a brief overview of Limited Brands and discuss the individual
business units within the company and their product and service offerings. We discuss the competitive
landscape in which they operate their various businesses and see the company from a strategic and
operational perspective. Based on the idea of collaboration in the garment supply chain, Johnson (2002)
writes about the importance of collaboration in the production of a constant flow of innovative products,
especially for short-lived products, such as clothing or computers. Johnson says that supply chain
relationships that are totally focused on extracting cost reductions from suppliers in low-cost countries are
unsustainable. As the physical distances between the various players in the apparel supply chain have
increased, due to the globalization of production, so has the complexity of the supply chain.

Introduction of Industry
Apparel means clothing, especially clothing; Clothing and Apparel is a term that refers to a covering for
the human body that is worn. Garment work is exclusively a human feature and is a feature of almost all
human societies. The quantity and type of clothing worn depends on physical, social and geographical
considerations. The primary function of clothing is to enhance the comfort of the wearer. In warm
climates, clothing provides protection from sunburn or wind damage, while in cold climates its thermal
insulation properties are generally more important. Shelter usually reduces the functional need for clothes.
Clothing plays a number of social and cultural functions, such as individual, professional, and sexual
differentiation and social status. Also the use of clothes has social implications. They are worn to cover
those parts of the body that social norms require to be covered, and act as a form of ornament, as well as
other social purposes.

Problem Identification/ Broad Problem Area/Need of the Study

In this area we find the problems that are face by apparel industry due to technology consumer
preferences are changing day by day. Customer loyalty will changed due to technology and
social media people have a lot of options they can made comparison before any purchasing they
can compare the price and quality of one product with other and then made decision so
companies need to change their strategies according to customer demand and need. To be
competitive, retailers must balance inventories to avoid out-of-stock scenarios that mean lost
sales. They must reduce the time needed to bring goods from design to delivery, or "speed to
market." Their success and ability to offer competitive pricing depends largely on their sourcing
selections. So retailer should need to alter their pricing strategies to attract customer because
customer want quality product with low price and with short time spam to full fill their desire
and need. Controlling inventory is not a new apparel industry issue, but the rules of the stocking
game have changed in light of the way consumers shop today. Customer preferences change
faster, which speeds up inventory turnover requirements. Suppliers then must adjust to smaller
orders placed by retailers and wholesalers, and improve turnaround times. This puts pressure on
their raw material, transportation, quality control and labor costs. As energy prices climb
worldwide and manufacturing costs rise in China -- where, according to IBIS World, most of the
world's clothing is made -- the industry has begun to seek more efficient production locations.
Strong supply-chain relationships are of extreme importance for inventory control. The apparel
industry is characterized by slow growth, overcapacity and low-priced imports, and competes
primarily on cost. It has historically been a labor intensive, low technology industry in which not
many capital investments in technology or process innovation have taken place.

Situation of Pakistan

Pakistan is the leading exporter of textile products, especially manufacturer and exporter of
cotton textiles on the world market. Currently Pakistani textile products lose their
competitiveness in world markets due to stiff competition with their competitors such as India,
Bangladesh and China (Spinanger 1995). Due to inefficient finances for the textile industry The
Ministry of Textile Industry could not execute the strategies and the implementation of the
policies (five-year policy 2009-2014) the industry currently has huge imminent responsibilities
under the schemes for the operational process, but it also has challenges for execution such as the
timely completion of the basic needs of the industry (Amin 2012). The total amount of Rs. 24.75
billion were allocated, which was against the allowed financing plan of Rs. 123 billion for 2009-
12. On the other hand, the value of the projects exceeds Rs. 6 billion are pending in the planning
commission for the past two years, arguing that the textile industry in Pakistan faces serious
problems due to the shortage of services such as gas, which is an important factor for the textile
industry.

In this industry most of products are manufactured in countries where cheap labors are available.
These countries are facing energy crisis, increasing raw material costs and old manufacturing
processes that will make them inefficient and low responsive means of communications are low.
Due to large private brands this industry will suffering they are introduce new designs every day
and products are out dated soon or everyday so industry will need to develop system to identify
demand of customer are need to efficient system to respond and full fill the customer need on
time or need to made efficient supply chain to deliver the product to end use or need to develop
strong research and development system to indentify new was or process to reduce cost and
efficient ways product manufacturing. Pakistan unstable political and other law and order
situation have great impact on this industry. Industry is sifting to other countries and government
is not noticing this factors.

There is a very tough competition in global markets. The market needs high quality product on
reasonable price. To improve the quality of Pakistani textile products the industry should
consider on the quality of raw material by the help of research and development institution. Any
forum (like APTMA or any other concerning institution) should do work with the help of R&D
Institutions to improve the quality of Pakistani cotton by arguing or by providing ideas to the
cultivators of cotton to improve the fiber quality (Faini 1995). Once the quality improved the
product can easily compete in international markets. If government failed to do than millions of
textile workers would become jobless and it may be a great cause to increase the unemployment
ratio of Pakistan. Government should consider seriously on all mentioned issues and solve the
problems as soon as possible to protect the textile industry of Pakistan.
Problem Statement

To find the solution to overcome the flaws of supply chain related to apparel industry and find
ways how they will minimize and increase the efficiency of apparel industry.

Research Questions

1. How to overcome supply chain challenges faced by apparel industry?

Objectives of the Study

1. To find out the new ways to overcome supply chain challenges.

Significance
It is very important industry now days the fashion industry produces clothing. This is obvious
thing we can see. Clothes in whatever shapes and sizes are manufactured by certain people who
work in the clothing industry. When you are meeting someone the first thing they learn about
you is what you look like. People tend to make assumptions about you because what you wear.
Fashion is a fantastic way to express your personality and let people know who you are. This
industry can give you opportunities it creates jobs for the people. By one way or another,
somebody income come from the fashion industry. It employs people both skilled and unskilled
at home or abroad to make the process work. It employs laborers on multiple levels like garment
works, pattern makers, textile designers, packing companies. Time changes and so does
everything around us, in the past decade we have witnessed evolution of technology, same thing
in with the fashion styles and the industry. We all wear clothes whether they are made by famous
fashion designers or ordinary people. Certain people are responsible for what you are wearing
today without these facilities or facilitator; we will be wearing what our forefather wore back in
time. This brings us to the importance of fashion industry in our society. The fashion industry is
often the most glamorous and underrated of industries. While almost every individual is a direct
customer of the fashion industry. This industry gives a high number of profit margins to
producers. In this industry you can earn more profit you have number of sales, give people
opportunity to get employed. High number of profit, sales. This industry now a days have a wide
scope. People are more conscious about their dressing they are more aware about fashion. All
want to look attractive so this field is moving upward very fast. The human race universally
wears articles of clothing also known as dress. In most culture clothing was introduced as a
method of protecting the human body against extreme weather conditions, strong winds, and
intense heat. But human wear clothing for functional as well as social reasons. Today, there are
many materials with which clothes are made. A person can choose from purchasing clothes made
from natural origin materials like silk, wool, and leather. Within recent technological
development, there is great speculation for the direction future clothes will take; in fact the
clothing industry has just started. A economy of country also growing through this industry.

Scope of Industry
As noted earlier, VS heavily relies on a technologically advanced and innovative product in
Development process. So, for a faster concept-to-market cycle, may have to reduce its product
design complexity. The apparel industry considered as one of the best paying industry today, a
career in fashion design has become famous among creative minds. Popularly conceived as a
glamorous field, the domain has competition and vast challenges as well. However, there is a
wide scope of fashion in Pakistan as well as abroad. Students have innumerable choices in front
of them after completing their studies in fashion design. The fashion designer have many options
including designing, research, cloth production, textile designing. The can also join fashion
houses and exports units for paid job or launch their own label in market. Creating new products
with latest trends prevailing in the market, the designers are key players in the fashion industry.
If you are creative enough to think out of the box and hard-working to handle the pressure or
burden in positive way then you will be suitably rewarded in terms of good earnings and
incentives. The person who involve in fashion industry must be aware of trends and transitions in
the domain, and should have knowledge about fashion designing as well. He should be an active
observer who is sensitive to the changing vogues.

Literature Review

Supply chain new ways are required because increasing trend of fashion industry

In a study of how SCM techniques are applied in a variety of industries which involve the production of
consumer durables, component parts, refrigeration products, industrial products, to gain competitive
advantages in inventory management through a case study, Jones and Riley (1985) presented three
main barriers to a supply chain as the following: (a) tradition, organizational, legal, and non-integrated
management systems; (b) independent businesses, vendors, and distributors; and (c) information and
control systems. Higginson and Alam (1997) identified barriers to successful use of SCM as the following:
(a) lack of strong management commitment and consensus leadership; (b) unclear definitions about
SCM; (c) legal issues in sharing data; (d) inefficient information systems, and (e) incompatible systems at
channel members. Johnson (1998) also provided five pitfalls that hinder in effective SCM: (a) wrong
choice of metrics for performance measurement, (b) poor operational control and execution, (c) lack of
information sharing, (d) poor supply chain design, and (e) poor product design. In the discussion, the
author suggested the percentage of complete orders shipped on customers' requested dates as a better
metric to measure customer satisfaction, which is the ultimate goal of SCM. Also, the author
emphasized the importance of finding manufacturing flexibility as a key breakthrough in supply chain
efficiency. In brief, lack of top management commitment and leadership, information sharing system,
and coordination between chain members are main barriers for companies to grow through SCM. When
21 barriers are identified as such, the effort to remove the barriers of the company can be part of the
SCM activities. From the previously reviewed research and conceptual articles, the multiple activities can
be grouped into six SCM dimensions. The level of SCM activities can be determined by the extent to
which supply chain members understand the characteristics and key issues, implement techniques of
SCM, and are willing to eliminate the barriers. The first dimension is the collaborative partnership with
chain members. Partnership is defined as "an agreement between a buyer and a supplier that involves a
commitment over an extended time period, and includes the sharing of information along with a sharing
of the risks and reward of the relationship" (Ellram & Cooper, 1990). A close partnership is not only a
prerequisite for SCM, but it can also result from successful SCM. Consolidation in supplier base is one
sub-issue required for better quality management, focused business, and long-term relationship. Under
a traditional relationship, the biggest concern for buyers is cost reduction and they select the suppliers
who offer the lowest cost. Multiple suppliers' competition on cost conceals the quality defect problem
because thorough quality inspection adds cost. And, the nature of the relationship with buyers tends to
be short-term and adversarial because buyers will switch to other suppliers who offer lower cost to
them. Therefore, activities which can enhance the long-term relationship through collaboration
between chain members such as joint planning and demand forecasting, accurate and timely
information sharing throughout the chain, and technology sharing are required activities to advance to a
partnership (Spekman, Kamauff, & Myhr, 1998; Vokurka, 1998). As these activities increase the
dependency on each member, a company is less likely to switch to alternative supplier or customer. The
utilization of information technology is the second characteristic to be measured. Examples of the
information technology are computer-to-computer communication, electronic data interchange (EDI),
POS data communication, and barcoding. Electronic links between suppliers and carriers or customers
are critical for 22 information sharing. Technologies at each stage of the supply chain should be
compatible with their partners' to better streamline the information. Types of information fed into this
electronic links are data on sales, usage, product changes, promotions, discontinuations, and product
and process (Sabath, 1995). Flexibility of operations is the third dimension.

Agile literature on multi-channel retailing. This is relevant to the Limited Brands’ distribution strategy,
and, more specifically that of Victoria’s Secret. In the 1990s, Giraffe et al developed a framework called
“global commodity chains” He also called “global value chain” in 1994 to 1999 (Gereffi and Memedovic
in 2003) said that tie the concept of the value-added chain directly to the global organization of
industries (Gereffi and Korzeniewicz, 1994). In this study the value chain is defined as the number of
activities involved in the design, production and marketing of a product. Gereffi et al’s work highlights
the growing and importance of new global buyers (main retailers and brand marketers) as important
drivers in the formation of global and organizationally fragmented production and distribution networks
and also highlights the importance of coordination overall the world. Gereffi have built framework to
help explain governance

patterns in global value chains. They state that the expansion and growing capabilities of the global
supply-base of the apparel industry have allowed it to move rapidly from locked up to more complex
relational value chains over the span of just a few decades. “Captive value chain” is defined as one in
which suppliers are frequently limited to a narrow range of tasks, for example, mainly engaged in simple
assembly. This was the scenario when supplier capability was low and the ability to provide detailed
instructions on part of the lead firm, as well as product specifications and complexity were both
relatively high, requiring a great deal of involvement and control on the part of the lead firm. Then, we
have a relational value chain comes into play when product specifications cannot be organize,
transactions are complex and supplier capabilities are high. In this case, there is a strong motivation for
lead firms to outsource and this requires useful sharing of information between buyers and sellers.
Collaboration in the apparel supply chain this idea was built by Jhonson in 2002. He writes about the
importance of collaboration in producing a firm flow of innovative products mostly

for short-life products, like apparel or computers. Johnson states that supply chain relationships entirely
focused on extracting cost reductions from suppliers in low cost countries is unsound. As physical
distances among the various players of the apparel supply chain have increased, due to globalization of
production, so has supply chain complexity. Companies in the apparel industry must find new ways to
control their supply chain partnerships through information combination and collaboration – improving
products, driving down cycle times, and reducing supply chain costs. Johnson examines how players
throughout the apparel supply chain, starting from raw fiber producers to retail stores, are reinventing
their businesses through web-centric collaborative product management to ensure better management
of the

increasing supply chain difficulty or complexity. The next category of literature is focused on corporate
and supply chain strategy it will helps in analyzing the Limited Brands’ position within the Apparel
Industry. Porter (1996) defines strategy as creating fit among a company’s activities. He states that while
operational effectiveness is a necessary tool, a clear overarching company strategy is the answer to
long-term sustainability.

Practices experienced in the traditional management of the supply chain raised the need for conversion
to a new paradigm of supply chain management (SCM). The traditional supply chain and manufacturing
processes relied on experience and intuition of managers and were designed with long supply cycle
times, large batch sizes, capacity based on annual volumes, volume-driven technology, and numerous
suppliers for the same parts on the short-term base contracts. With traditional management processes,
the goal of business activities was to maximize the efficiency of an individual functional unit by achieving
competitive edges based on cost reduction. Under the traditional supply chain, efforts of manufacturers
to meet the increased changing of customer requirements caused decreased margins, poor service
performance, increased overhead costs, poor production process reliability, increased downtime due to
changeovers, and high inventory levels of raw materials and finished product. None of these conditions
are viable in a competitive market. Most product supply systems are out of balance with customer
requirements (Lummus, Vokurka, & Alber, 1998). Davis (1993) listed reasons 14 why SCM needs
renewed attention: reduced profit margins due to pressure from increasing competition, needs for
administrating multisite manufacturing, cut-throat marketing channels, maturation of the world
economy, customer service demands for quick and more reliable delivery, and pressure to reduce
inventories. According to Cooper and Ellram (1993), SCM is designed to solve these problems and is
important to reduce inventory investment in the chain, to increase customer service, and to help build a
competitive advantage for the channel. With a changing management focus, companies also began to
realize that maximization of efficiency in one department or one functional unit is less desirable than
optimal performance for the whole company. Needs for effective vertical integration and consumers'
desire for a wider variety and complexity of products have led to demand for SCM (Lummus, Vokurka, &
Alber, 1998).

The concept of SCM is relatively new to academics and practitioners, appearing first in 1982 (Cooper,
Lamber, & Pagh, 1997). Although the term, supply chain management, has been used since the 1980s
and the academic and trade presses have given extensive attention to the concept, confusion still
persists in defining what is SCM (Bechtel & Jayaram, 1997). Many researchers have tried to define the
meaning of SCM. Although subtle differences are found in the word choice and expression,
commonalities contribute to an understanding of core concepts in the definition of SCM. The first
component is the range of participants. The second component is the flow of materials and information.
Agreement across definitions is that materials, whether raw materials or finished goods, and
information flow simultaneously both upstream and downstream in the chain. Third, to manage the
flow of materials and information and to provide high customer value, integrated and coordinated
value-added activities are required (i.e., cross-functional approach, joint planning and forecasting,
flexible operations).

RESEARCH DESIGN AND METHODOLOGY

. SOURCES OF DATA

A range of tools will be used to collect the required information. The following method is used to collect
data.

1. Interviews / Schedules
2. Observation
3. Demographic Survey

Execution of this methodology would include:

1. Identifying and interviewing local cluster members and promoting agencies to carry out an
objective and issue based assessment.
2. Observation / business profile review: Collection of samples from cluster would be done to
review design, quality of product, marketability and overall business prospect.
3. Demographic Survey – Classification and analysis of respondents based on demographic
parameters.

Sample Size
The sample size is an important feature of any empirical study in which the goal is to make inferences
about a population from a sample. In practice, the sample size used in a study is determined based on
the expense of data collection, and the need to have sufficient statistical power.In our study we choose
200 sample size for collection of data .That belong to different gender and age group.

SAMPLE DESIGN / PLAN:-

SAMPLING TECHNIQUE:

CLUSTER SAMPLING: Cluster Sampling is the technique adopted for the study in which population is
divided into clusters and drawing random sample from all or selected clusters.

STATISTICAL TECHNIQUES FOR DATA ANALYSIS:

1. Descriptive Statistics
2. Likert Scaling / Ranking
3. Correlation Analysis
4. Regression Analysis

Following tables show to result of analysis

Explanation

Descriptive statistics data show the normality of data. Skewness and kurtosis value should be lie
between -+ 3. In our data the value of Skewness and kurtosis lies between the prescribed range.

Correlations
Explanation

In our data there are two star that shows the moderate level of correlation, level of significance is
0.01which means 99% data is correct only. The correlation result is .238 which shows moderate
relationship.

ANOVAa

Model Sum of Squares df Mean Square F Sig.

Regression 2.131 1 2.131 11.839 .001b

1 Residual 35.638 198 .180

Explanation:

The results show the significant relationship between independent and dependent variable.

Conclusion

The purpose of this study gives you a clear picture of apparel Industry in line with the online
systems that sell goods in terms of infrastructure management plans. The results of the
provisional processes are crucial in the commercial business enterprises. Apparel dealer has
achieved the benefits of providing material resources. However, it seems to be running its
competitors today in terms of income, except for any retention fees and the preservation of
technology in the market. As a result, sales plans and sales seem to play a major role in the
manufacturing industry. The success of apparel industry methods is to control and evaluate the
most advanced goods market so that they can slowly reduce their lead time and thus respond
rapidly to changes in customer needs and needs to reduce the risk of the window .The results
may differ from other companies. Future lessons can apply extensive business research.
However, this important study is one of the few lessons in the apparel that corresponds to the
supply units. The questionnaire explicitly describes the image of the apparel Industry. During the
course of this study, it became clear that the current situation of apparel is not good. However,
there is a strong desire for the implementation of new strategies for developments. This research
reflects the weaknesses of corporate technology. Therefore, the industry needs to invest more in
information systems to improve its dietary activities. The industry appears to be available for
appropriate resources.. Additionally, a industry may involve different marketing practices
although the current system has been proven to be successful. These movements will benefit
from profitable profits because many programs have already succeeded. They are adequately
relevant for their programs, sales, and marketing practices. On the other hand, they are seen to be
happy with their sales revenue. It is estimated that the reason for their success is to follow new
supply chain strategies if strategies are good they can achieve their objective effectively or meet
the customer needs or full fill on time.

References

1. https://explorable.com/research-designs
2. Amanda C., Charlese J., Martha N., 2004, Zara: Fashion follower, Industry leader,
Business of Fashion Case Study Competition, Philadelphia University.
3. Bhardwaj, V. and Fairhurst, A. (2010). Fast fashion: response to changes in the fashion
industry. The International of Retail, Distribution and Consumer Research, 20(1), pp.
165-173.
4. https://pdfs.semanticscholar.org/6dc4/fd6d36b90270fddf65a9fa35f26c315841e0.pdf
5. http://www.tandfonline.com/toc/tscf20/current
6. https://www.ups-scs.com/solutions/white_papers/wp_supply_chain.pdf