Lean manufacturing has been around for over a century, but only recently has the concept been successfully applied to apparel manufacturing.
What is Lean Manufacturing?
According to Wikipedia, lean manufacturing or lean production, often simply “lean“, is a systematic method for waste minimization (“Muda“) within a manufacturing system without sacrificing productivity. Lean also takes into account waste created through overburden (“Muri“) and waste created through unevenness in work loads (“Mura“). You can read more about it on Maker’s Row!
“The five fundamental principles of lean manufacturing revolve around adding value to products and services, enhancing the value stream from end to end, improving workflow, reducing the overall time-to-market, and achieving perfection throughout the entire program.” (taken from The American Machinist)
In other words, lean manufacturing is producing only what is needed, when it is needed, and in the amount it is needed. It is demand-based manufacturing and when done right, helps to reduce waste, including inventory as well as excess transportation, idle time, bottlenecks in the process, and more.
When Was Lean Manufacturing First Used?
In 1910 Henry Ford created the first comprehensive Manufacturing Strategy. He incorporated all the elements of manufacturing, the people, machines, tooling, and products and arranged them into a continuous system for manufacturing the Model T Automobile. (taken from Strategosinc.com). This was the first time lean manufacturing had been used.
How is Lean Manufacturing Being Used in the Fashion Industry Today?
Zara, the world’s largest fashion retailer is the master of lean manufacturing in the fashion sector. A pioneer among fast fashion companies who basically knocks off higher priced fashions into cheaper versions. Zara offers the latest trends at prices that are pretty affordable: coats for $200, sweaters for $70, T-shirts for $30. Zara has risen to the top because they’ve been able to produce what the people want when they want it, and only in the amount that’s needed. Let’s take a look at how they do it.
Zara will make a collection and ship only a few pieces of each style to a store. That way there is little inventory. Then the store managers are carefully trained to monitor customer behavior and reactions in the store. If they see something is selling out, they can easily request it. Or if they hear a customer say, “I love this burgundy color,” they then can report this information back to headquarters where it is passed on to their team of designers who then can develop new styles based on the information.
So in a way the customer is the one dictating production. Each item being produced in a way has been requested by the customers. This helps to keep inventory at an all-time low.
Merchandise in the store also moves extremely fast, as each store receives new deliveries twice per week! The customer understands that if they don’t buy it right then and there, it won’t be there next week. And because the prices are so low, they always choose to buy it rather than take a chance.
Zara also produces the trendiest items closest to their home base so that the production process takes only 2-3 weeks start to finish and they can ship it to the stores faster.
Zara may not be the most innovative fashion brand out there as far as their product goes, but they are the leader at process innovation because of the lean manufacturing model they’ve been able to develop and implement.
Why Are There No American Fashion Brands Using Lean Manufacturing?
Manufacturing in the US has always been appealing for many reasons;
- Low Minimums. Most other countries require at least a minimum of 1,000 units of a style in order to produce while you can produce any amount you’d like in the US.
- Faster lead times/speed to market. For brands that have stores in the US, having the ability to produce closer to home definitely helps with quicker turnaround times.
- Lower costs on shipping. Again producing closer to home means the items are not being shipped as far.
- Easier communication. If you are an English speaking company, it will definitely be easier to produce here in the US.
- Ability to oversee manufacturing and be very hands on. When a designer can go to a manufacturer and see the items being made it helps tremendously to cut down on mistakes being made as well as gives the added advantage of being able to make last minute changes or additions.
So if manufacturing in the US is so great, why is it that most of the big fast fashion companies like TOPSHOP, H&M, Mango, Uniqlo, Primark, etc., don’t produce in the US?
For one, a lot of these companies don’t particularly like to even sell to the US! Zara has been expanding its stores everywhere but the US. Why? They have been noted as saying that the problem with America is that they don’t fit the clothes. It is a European brand and having to make larger sizes for production makes things more difficult. So if brands don’t want to sell here, then it doesn’t make sense to produce here. But what about American brands who are geared towards the American consumer?
Brooks Brothers, an American brand, has 3 US factories which make 45 to 50% of the company’s clothing, 10% of its shirts, and 100% of its ties. The rest of its products are made in Asia and Europe. Brooks Brothers’ has a turnaround time of only 5 to 14 days which means again that the company can be responsible to their customers demand and reduce excess inventory. (according to the Business of Fashion). So Brooks Brothers has been successful at incorporating the lean manufacturing model, but their prices definitely don’t match those of Zara. And the main reason for this, as well as the main reason most brands don’t produce in the US, is of course due to the much higher labor prices.
But let’s remove the labor price issue for a minute, and talk about how more brands, especially American brands, can start to incorporate the lean manufacturing model.
How Can We Use Lean Manufacturing to Make Domestic Manufacturing Competitive?
1. Design with Lean Manufacturing in Mind
Designers need to be sure they are using the same fabrics across multiple styles in a collection. This way if one style doesn’t sell there are at least a few others that can help add to the total yardage needed in order to meet minimums
2. Involve the Consumer in the Design Process
In order to reduce inventory and waste, brands need to figure out creative ways to involve their customers in the design process. TOPSHOP did an excellent job at this when they did their Archive Collection back in 2015. They created a limited-edition 33 piece collection based on authentic re-editions of original TOPSHOP designs that were requested by their fans. They invited their customers to post images of their most-loved past TOPSHOP pieces using the social media campaign #BringItBack, for the chance of having the piece make a resurgence in the Archive Collection. This is brilliant! I don’t know about you but I wish every brand would do a collection like this!
3. Create Limited Editions
By created limited editions or a limited number of units per style, not only does it help reduce inventory and waste, but it also helps create demand! The scarcity tactic works every time! There are many brands doing this very well including Supreme, Johnny Cupcakes, and Maison Cleo who all capitalize on FOMO or Fear Of Missing Out! By selling only a limited quantity these brands build so much anticipation around their collections that there are lines wrapped around the block just to get their clothes.
By incorporating these three things as well as producing domestically, more brands can capitalize on the lean manufacturing model. But until we can figure out a way to work around the labor price issue in the US, I’m afraid it will be difficult to really compete with Zara.
Starting a fashion line and wondering how to produce it locally? Join us on our upcoming NYC Fashion District Manufacturing Tour. This 6 hour behind the scenes tour will give you all the tools needed to manufacture a line from start to finish. Check out what others are saying about our tours; “In a short time I learned what would take me weeks,”- Aaron, “I feel grateful that I found Christine Daal and I feel so empowered to be able to move forward”-Edvin. Learn more about our always sold out manufacturing tours here and be sure to register for the next one! Don’t see a tour on the calendar? Sign up now to be notified when the next one pops up!
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