“The single most critical move an apparel company can make in 2020 is to embrace a demand-based manufacturing model. Today’s market moves far too fast to put precious dollars into inventory that will ultimately be sold at major discounts, or not at all, due to inaccurate projections.” – Brian Sather, CEO of Blacksmith International
Due to the outbreak of Covid-19, many apparel brands have been left with a surplus of unsold products. This is an age-old issue that has plagued all sectors of the fashion industry for years. The traditional approach of the supply model – obtain supply, then create demand – has many costly problems.
Problems with the Supply Model
- Large quantity manufacturing can lead to surpluses of unsold product (one garbage truck of clothes is burned or sent to the landfill every second!)
- Discounting unpopular products can lead to low margins and profit loss (according to Coresight Research, US retailers lost $300 billion in revenue due to markdowns in 2018)
- There’s no quick way to restock items that sell well, leading to lost potential revenue (manufacturing overseas means a minimum of 45 days to restock – that’s a lifetime in today’s markets)
So, what’s the solution? It’s ON-DEMAND MANUFACTURING.
Blacksmith International has been working on finding a solution to the obstacles to a successful on-demand model. Over the last year, Blacksmith has been testing our own on-demand factory, located in Utah.
The purpose of this factory is to provide premium sampling and small minimum order quantities in a cost-effective way. This means that brands can test the market on different designs with low financial risk.
Designs that are not selling can be easily discontinued without having to deal with a pile of unsold merchandise. Styles that customers show interest in can be ordered with faster turn-around times than the traditional model.
Simply put, the on-demand model is the future for the apparel industry, especially for direct to consumer brands. It takes the guesswork out of manufacturing, allowing companies to respond to consumer taste with agility, and not leave potential revenue on the table.
To test the Blacksmith on-demand factory with your product, please fill out the form at the bottom of this page: US Manufacturing