Intimate Apparel Industry and ERP: A Perfect Business Fit

Transcription

1 Intimate Apparel Industry and ERP: A Perfect Business Fit With the unpredictable stance western countries have towards Chinese textile products on the trading front, management staffs of large-scaled brassiere manufacturers believe that Brassiere products have to be marketed as Fashion in order to enhance sales instead of being promoted as consumable products. In fact, what matters most is solving a list of other problems reducing order size with complicated styling and colors, enabling shorter lead time, etc so that enterprise efficiencies can be enhanced for better profitability. Intimate Apparel Industry: the Latest Fashion Trend MSC consultants truly understand the latest global trends the fashionization of underwear products as well as the inside-out of underwear products. In the 19 th century, women of wealthy families in the western world used canvas, whalebones, steel wires and lace to create brassieres for themselves. Nevertheless, these types of brassieres only aggravated the general bodylines of women making their bodies more sandglass-like. What s worse, prolonged usage of these kinds of brassieres would damage organs. In 1889, a Paris-based brassiere manufacturer (Hermine Cadolle) invented the world s first modern brassiere: one that supports the breast without overly limiting diaphragm movements. According to statistics, a woman consumes 200 underwear pieces in her whole life, starting at the age of 12 or 13. With this number, it is not difficult to see the enormous prospect for the development of underwear industry. Challenges to the industry include multiple styles, small-sized orders, multiple colors, short shipment cycles, etc. All these have given the whole industry considerable problems in sampling, order tracing, requisition and information management. Apart from the fashion industry, Hong Kong also has a well-developed underwear industry, an important branch of its service industry. There is in fact great potential associated with this and has in fact become the part of the fashion industry with the brightest future. Hong Kong has a long history of manufacturing underwear products, with most of its products being world-class brands already. Nevertheless, many underwear brands have recently relocated their manufacturing bases to Southeast Asia and Mainland China. At the same time, customers have become more aware of the materials in underwear products and as a result, 2006/8/4 1 MSC in Underwear Industry.doc

2 competition in the underwear market in Hong Kong has now become very intense. Many midto-high-end underwear manufacturers in the past were only involved in OEM and ODM businesses. Today however, it is not enough for these industry players to solely focus on the provision of underwear products with mere basic use and comfort to the consumers. Consumers want not only a sense of fashion with the underwear products but also to match them with other fashions. They see underwear products as their second layer of skin and thus ask for more on their design. As a result, there is currently a wide range of choices for the customers with regards to styles, colors and materials. The Concept of 3D Underwear Manufacture and Variable Accessories The underwear industry has flourished in recent years and there is indeed a big global demand for some high value-added underwear products. Therefore, there is a great urgency for promoting an integrated development of professional services on underwear design, use of highly-functional polyester and other materials, textile accessories, machinery design, manufacture and marketing. Issues regarding the manufacture of underwear products such as machinery, manufacture processes, materials and accessories are all very complicated. Specifically, the concept of 3D manufacturing of underwear products is the most critical. Meanwhile, the printing, dyeing, processing and testing of materials as well as the general manufacture and quality-control processes are also very important. In 2005, the Hong Kong Polytechnic University launched ASIIA s BA Honours Degree course in Intimate Apparel. By providing a series of subjects on the design, operation and production of underwear, the program offers professional training to the practitioners of the industry. The person responsible for the program, Dr Winnie Yu Wing-man Associate Professor of the Institute of Textiles and Clothing said that underwear products seem to consume a minimal amount of fabric materials. While this may be true, it is wrong to think that their design and variability is simple. Industry practitioners appreciate the fact that the design of underwear products is indeed more complicated than that of other fashions, with more attention to details needed. Even if the eventual design varies a little bit, it could well mean much less comfort. This is the reason why underwear design needs the best of accuracy, with a requirement that each item be in its own perfect position. With the above-mentioned program having been set up, we can see that the design and manufacture of underwear products should be based on professional theory and technique. Meanwhile, some manufacturers also pointed out that the material combination of popular underwear products is quite complicated. For example, there are the different materials for a piece of brassiere, plus some other materials and parts like lace, frosted straps, jelly pads, 2006/8/4 2 MSC in Underwear Industry.doc

3 bra adjusters (hooks), metal shoulder straps, bra wire ends, metal decorative parts, etc. Then with the creativity of the designers, the amount of each part or material is determined. Furthermore, a perfect management system is needed for control on the functionality and elasticity of each part or material and the degree of combination between each of them. In fact, a lot of manufacturers now participate in the R&D of new materials, equipment and other technologies. As a result, there is a constant flow of new kinds of material so that consumers desires can always be satisfied. Technologies always lead to innovation in the materials of the underwear products and hence fashion. Time flies and fashion sense changes. The style of underwear products is becoming more and more diversified as a result of new technology. In the past, the style of underwear products lacked diversity but in recent years, invisible brassieres, seamless underwear and low-waist underwear pants have become the latest breakthroughs in the industry. Innovation in the design of underwear products is much sought after in the industry while manufacturers also seek an improvement in quality. Meanwhile, industry practitioners suggest that women should try out different styles and sizes of underwear products before they decide which ones suit them most. Because every single woman has her own unique beauty and body shape, the industry should keep a complete production line. With different sizes and styles available on the marketplace, all women can then enjoy her beauty and be appreciated by others. This is the major market trend a desire for the perfect quality. The Challenges Faced by the Underwear Industry The trading disputes between China and the western world have escalated and there are concerns about its potential impact on the orders for Hong Kong s underwear manufacturers. This is especially true when the U.S. set up a quota system on specific textile products, including those on cotton and polyester underwear products. Lately, plenty of orders have been shifted to places like Southeast Asia and Sri Lanka. At the same time, there are limitations placed by the European Union on Chinese products and the orders are forecasted to further decrease. Last year, at a certain seminar regarding the underwear industry, Chairman of Hong Kong Intimate Apparel Industries Association, Mr. Andrew Sia, said that trade disputes between China and the U.S. and the European Union would only increase in the post-quota era. Therefore, the whole Hong Kong textile industry, including the underwear industry should get ready for the challenges ahead. Mr. Sia further pointed out that Hong Kong s underwear industry should not rely too much on their low-cost advantage but rather, they should improve their design and production abilities, with an aim to take on the challenges regarding qualities and services as well. Meanwhile, they should also be ready to shift their businesses from OEM and ODM to OBM. With challenges lying ahead, Hong Kong manufacturers should employ a better value-added model of production (Computerized, Real-Time and Just-In-Time) and a Business Intelligence Solution, so that their production and sourcing of materials are more effective and better diversified. Better Underwear Production Flows Facilitated by ERP System Brassieres (underwear) are mass-produced. It starts off with the design department setting up all the production flows. Each will be different with its own simplified or complicated model. For each standard brassiere item, many smaller parts will be needed (the very popular functional brassiere products like those gel bras and water bras will have a much more complicated process). A bra consists of cups for the breasts, a center panel, and a band running around the body under the bust; unless it is a strapless bra it will also have a shoulder strap at each side. It is typically made of a fabric such as cotton or lace, with the cups for the breasts given shape by underwires or plastic reinforcements. The bra is usually fastened by a hook fastener on the band, typically at the back, but in some bras the fastener is situated at the front, in between the cups. Some bras contain padding, designed to improve comfort and provide a more flattering shape this is sometimes in the form of silicone gel packs. Push up 2006/8/4 3 MSC in Underwear Industry.doc

4 bras, designed to enhance cleavage, usually contain padding. Some special sewing machines with more than ten functions will then be needed. Each step of manufacturing a bra requires stringent control to monitor the works, including the exact number of stitches, a particular operating posture, time of a specific step, etc. All these steps require the staff to work together and in a well-balanced time and constant speed, from start to finish. At the same time, quality control is incredibly important, and that calls for cross-examination and checks. All these will guarantee smooth flows, resulting in a steady production volume and a stable product quality. For effective monitoring operation, an enterprise resources planning (ERP) system is necessary. MSC Apparel ERP Solution is software tailor-made for the garment industry (including the underwear industry). Due to more advanced global information technologies in the garment supply chain and their subsequent impact and use, each garment manufacturer needs a faultless resources management and production system. This will facilitate better handling and monitoring of those very complicated and tedious works, hence improved efficiency. MSC s ERP system for the garment industry has extensive coverage, starting from the very early planning stage (drafting) to others like sample making for potential buyers, the tracing of orders, resources planning and calculation as well as storage management and shipping, etc. Currently, there is a view commonly shared by most business chambers and universities in Hong Kong: through the use of ERP software, manufacturers can more effectively monitor the entire production flow. What s more, ERP software can assist the manufacturers in reallocating the internal resources of the enterprises, further lowering their costs. Possible Areas for Improvement Through the Use of ERP System by the Underwear Industry : 1. Streamlined flows Traditional documentation (starting from faxing of orders to the clients to others like production scheduling and the recording of other works) can be transferred to the ERP system, which can link up the respective systems of the clients and the suppliers, further materializing a script less operation. ERP System can save time in the processing of orders, compared with the use of a manual system. In the meantime, an improvement in efficiency also allows an enterprise to obtain some better payment terms with its suppliers, leading to some savings in material costs. In a rationalized global operation process, transparency of information is enhanced, smoothening the enterprise s global operation information through the use of some more accurate information analysis. The System also facilitates a real-time analysis detailing different costs, allowing the enterprise to better handle cost monitoring in a more beneficial way. 2. Shortened cycle from ordering to delivering ERP System enhances the industry s supply chain. Under better cooperation with the clients and the partners, an enterprise can achieve the target of cost saving. Inventory levels can be lowered while trade flows can be streamlined, resulting in better yields. 3. Monitoring of material costs After some calculation by the system, the ERP can effectively give better estimates of the amount of follow-up raw-material orders as well as limitations of supplies. Such information will be sent to the clients EDI systems, giving rise to more efficient matching of buyers and sellers. Negotiation abilities are enhanced because more bulk orders of material are being placed, directly lowering material costs. MSC can facilitate some basic functions like the Bills of Materials (BOM), Material Requirement Planning, Purchasing Contracts, Material Request, the confirmation of product manufacturing, etc. Other control works and analysis reports can further help the management staff. These include the checking of materials in and out of the inventory as well as that of rejected materials, calculation of costs, etc. 2006/8/4 4 MSC in Underwear Industry.doc

5 4. Balanced production line and better tuning of production scheduling Through the use of ERP System, a quick test report can be generated, so that production can be monitored at the bottlenecks. Necessary changes can be carried out and this will result in some better yields for the enterprise. The System can also provide an estimate of how the machines are being used. The factories will then be able to respond with better production scheduling, according to changes in client orders. At the same time, labor, work space and machines can be allocated in a more appropriate way, yielding maximal productivity and lowered costs. 5. Better control of salary costs ERP system can assist in better monitoring of overtime work (in accordance with RFID WIP Shopfloor Management System). Slacking by labor staffs can be avoided, cutting down unnecessary working hours. The System can also trace the labor staff s total work time, further lowering internal and external waste time. The amount of effective overtime salary costs can be calculated through the use of the System s time-tracing operational function. A production target can be formulated, forming a basis for improving productivity. 2006/8/4 5 MSC in Underwear Industry.doc

6 6. Control of material inventory ERP System can give the management a clear picture of the inventory levels. This way, specific requisition works can be arranged in accordance with the practical storage levels. Furthermore, when other related materials are being ordered, necessary works can be done so that some materials can be reserved at the storage place, avoiding duplicate orders and thus excessive storage. The System can integrate several smaller orders into a bulk order, aiming at Bulk Purchase Discount) from suppliers. Other Benefits Brought About by MSC ERP When an enterprise is making its decision, the management should work towards linking up different departments. When the manufacturers formulate their Sales Forecasts, Material Inventory Planning and Production Planning, a huge amount of time is spent on collecting different types of data. However, data or information at the rear end sometimes fails to be collected or takes up a considerable amount of time to do so. An enterprise always hopes for the most updated data or information (such as daily or weekly information) but due to different reasons, only monthly information tends to be collected. This is a big hindrance to an enterprise s smooth operation. An ERP for the garment industry can be said to be one of the most excellent tools for resources allocation. Based on this system, the latest information technology can be utilized (coupled with the use of RFID workflows for minute-by-minute data collection), so that the enterprise can formulate better decisions on allocating their operating resources such as labor, materials, capital and time. All those mentioned above can transform the strengths currently possessed by the underwear industry from a labor intensive production mode to a technology intensive mode as well as from some effective processing works to an excellent brand power. Special attention should also be given to the management of other synergy relationships for the underwear enterprises such as those regarding the major materials of the underwear products, models, steel rings, tape and laces. A comprehensive ERP Management System for the garment industry is a necessary tool for the effective running of the global supply chain. In view of Hong Kong s entire garment industry, which includes the underwear industry, the electronic development of the industry in the future is almost certain to be based on a new economic environment, such as one with ERP System in place. In this environment the key words are Quick Response, Co-opetition - a blend of cooperation and competition and Collaboration, all of which have assisted the management of the whole supply chain, the management of product information, the sustainable development of the enterprises which operate with global information. MSC Apparel ERP Solution can also support the enterprises by providing all information necessary for operation. Not only will communication and conferencing purposes be satisfied, but also a more effective interaction between the management can be built up. Besides, staff members from different departments and personnel of other related businesses could then be supplied with a tool for accessing critical data or information as well as controlling workflows. 2006/8/4 6 MSC in Underwear Industry.doc