The key factors influencing the supply chain are globalization, technologies, consumer trends, and retail trends.
Globalization is the integration of textile and apparel. Free Trade Agreements, world economics, politics, and developing countries are all factors in globalization. Free Trade Agreements allow more liberal exchange of products among countries. World economics has to do with exchange rates and cost of importation. Developing countries do not have strong economic development. Textile apparel is big in developing countries because they are labor intensive and labor work is much cheaper there.
Technology is always changing and improving. Tech specs are being transmitted through computers and they have the ability to communicate to suppliers and retailers.
Consumer trends mean that people want clothes faster, cheaper, and better. Retailers want apparel faster due to new fashion statements, and they want the quality better.
There are new retail trends, like E-commerce, which is doing business electronically. Also, merging of department stores, like what happened to Kaufmann’s and Macy’s, are part of the retail trends. Also, wholesalers are becoming more popular, like BJ’s, Sam’s Club, and Costco.
The supply chain cycles are being forced to be more compressed and faster. And, consumer demands want things faster. The supply chain is also becoming more scrambled, and some stages are skipped. Retailers are being skipped and consumers shop at wholesaler clubs instead. An example of this is BJ’s Wholesale. They sell a variety of things from electronics to clothes to food. Sometimes, the retailer skips the wholesaler and goes to off-shore factories instead. Those off-shore factories can be mills, and subcontractors can have ownership with consolidators.
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