Enterprise Resource Management (ERP) Ecosystem for Textile and Apparel Industry
Manufacturing, Materials, Project and Supply Chain Management
The manufacturing process represents the core of any product industry, and technology advances in the manufacturing space have been well-documented. The apparel industry has many similarities with other manufacturing verticals such as consumer products, electronics and automobiles. However, certain differences exist which need to be addressed for the technology adoption to serve apparel and textile manufacturing efficiently and effectively.
Different Types of Manufacturing Management Systems
The apparel industry is structured as a layered industry, and many parts of the process are outsourced or given to contract manufacturers. Unlike say automobiles or electronics however, the final assembly of components is not in one place. Therefore, the process mapping tends to be complicated. Based on the type of work being done by a brand or manufacturer, the various types of systems used to monitor the entire production process can be clubbed under broadly the following categories:
APS: Advanced Planning Systems, where the production planning happens
MRP: Material Requirements Planning, where the sourcing and inventory is managed and tracked
SCM: Supply Chain Management, where the linkages of one stage to the other, from raw material to finished items going to market is tracked
PLM: Product Lifecycle Management, which is largely concerned with manufacturing and sales till the end customer
PMS: Production Management System concerned with only the core manufacturing aspects
All of these are broadly clubbed under the umbrella of an Enterprise Resource Planning (ERP) system.
Depending on the scope of the work being done, not all companies require a full-fledged ERP system. For example, textiles may be more concerned with the SCM and MRP part, while a small retail brand would look at the PLM part more than other aspects, since they source their garments from contract manufacturers. However, large brands e.g. Nike, etc. would typically invest in end-to-end ERP systems like SAP, Oracle NetSuite and Backbone, where the entire process is spread across multiple locations and is fairly complex to track.
Depending on which part of the value chain the company covers, the scope of the manufacturing management process can be streamlined with the use of the right tools and technologies.
Difference between process for textiles and garments
While apparel and textiles form part of the same broad industry, there are significant differences between the two for us to separate them as unique process-based industries.
Some production management platforms offer both modules, just as larger ERP systems have modules designed for different industries around a core functional system. Others are specific to the textile, garments or even accessories/leather segment, with specialized modules that cover the unique processes of these industries.
In garment manufacturing, finished textiles are taken as the major input to complete the production of final garments while the textile industry tends to be more about filaments, yarns, threads, colours, weaving and knitting and their various processes. Textile processing while batch based, can also be a continuous process and hence it is treated differently as compared to garment manufacturing.
With the apparel and fashion industry, the nature of production can vary across 4 main formats. These include:
- Make through or end-to-end system for boutique or very small quantities
- Group system or section system
- Bundle and Progressive Bundle System (PBS)
- Synchronized or straight-line production system
Therefore, manufacturers need to choose the best system suited to their way of working, with a degree of flexibility built in. The PMS tools are the best suited for this space, for manufacturers who are contract vendors or suppliers to larger brands. These can cover aspects like material sourcing, quantities, consumption, Work-in-Progress (WIP) inventory, labour and machinery utilization etc to provide an accurate picture of profitability and margins using efficiency metrics.
The PLM aspect of a management system focuses on the production output, what was delivered where, how much remains in the system and therefore what products should be re-ordered or halted. It can have aspects like retail analytics built into it, thereby giving brands a better idea of what types of styles they should focus on for the coming season as it captures and consolidates customer purchasing trends. E.g. Pretture tracks inventory at the store level to let you know what is moving.
The SCM part primarily looks at the requirements of various input materials, the work in progress and the finished goods delivery to the end-point, whether distributor, retailer, stores or end-customers. It is concerned with optimizing logistics for the company. E.g. ApparelMagic has a timeline tracker of all activities.
Companies can choose to use a single or multiple software solutions depending on the legacy systems in place and the requirements of their value chain. For example, contract manufacturers would ideally need the same ERP system that their clients use, so that there is seamless interchange of information. Sometimes however, this is not possible and it can become necessary to build a custom solution to enable data transfer between the two, like an interpreter converting one language to another for the comprehension of both.
Conclusion
Any business that looks at manufacturing as one of its core functions will require the appropriate tools to ensure efficient working. Choosing the right set of tools can be critical and since it is usually a high-involvement decision, company top management is always involved in the process. Mapping the needs of the organization, its current systems and a future projection of the type of functions needed therefore take on a high level of priority. Getting the right stakeholders involved, from the process managers to the decision makers will determine the ultimate adoption and success of the tools used.
Fuel4Fashion is a design, branding and technology consultancy for the fashion and apparel industry. We provide consulting and advisory services across design, business and IT processes to early stage and mid-sized apparel manufacturers and brands looking to grow their business with the help of smart sustainable management practices. Visit our website here and follow us on Instagram and LinkedIn for regular updates.