Substance of the Fashion Industry

1
Substance of the Fashion Industry

• Fashion Marketing
• Chapter 4

2
Channel of Distribution

• Def. the route that products take from the
  original source, through the production process,
  and sales to the ultimate user.
• 2 channels
• Soft Goods Chain
• Four Groups Approach

3

• Fashion merchandisers should understand the
  processes, timing, and practices of the
  individual segments or groups within the overall
  fashion industry

4
The Soft Goods Chain

• Also, called textile/apparel pipeline
• The channel of distribution for apparel and home
  decorating textiles.
• 3 main Segments
• Textile
• Apparel
• Retail

5
Textiles

• Fibers very thin strands that are the beginning
  of textiles
• Yarns continuous strands of textile fibers that
  are processed into fabrics
• Fabrics long pieces of cloth
• Greige goods fabrics in an unfinished state

6
Apparel

• Produces finished garments and accessories
• Steps in the Apparel Segment
• The apparel must be designed
• Designing is the process of creating new versions
  of garments, accessories, or other items
• Design ideas move fashion forward by creating
  change

7
Apparel

• Steps in the Apparel Segment
• After apparel is designed it must be manufactured
• Almost all are mass-produced in factories
• They are cut out of fabrics in large numbers and
  sewn along assembly lines
• Apparel sales involves selling the manufactured
  garments in large quantities to retail stores

8
Apparel

• Resellers wholesalers who serve to distribute
  goods between producers and retailers or users

9
Retail Segment

• Retailing is the selling of merchandise directly
  to customers
• Retailers buy finished goods in large amounts
  from the apparel segment that precedes them in
  the pipeline
• Retailers pay a wholesale price for this quantity
  buying of finished products
• Retailers put these items out on the floor of
  their stores for sale at a retail prices, which
  is higher than the wholesale purchase price

10
Retail Segment

• Retailers pay a wholesale price for this quantity
  buying of finished products
• Retailers put these items out on the floor of
  their stores for sale at a retail prices, which
  is higher than the wholesale purchase price
• The markup covers cost of heat, lights, taxes,
  sales help, and other expenses
• Retailers do single item selling of garments,
  accessories, and other goods to consumers

11
The Four Groups Approach

• Separates the fashion industry into 4 main groups
  of business
• Primary group (raw materials textiles, leathers,
  furs)
• Secondary group (manufacturing garments,
  accessories)
• Retail group (final distribution stores
  catalogs, internet, TV sales)
• Auxiliary group (fashion-related trade
  associations, publications, and consultants)

12
Vertical Integration

• The combining of 2 or more steps of the pipelines
  within one company and under one management.
• Example Textile mills produces their own yarn,
  fabrics and perform the finishing process.

13
Commodity, Fashion, and Seasonal Goods

• Two main categories of merchandise
• Commodity products
• Staple goodshardly ever change in design and are
  in constant demandsales are predictable
• Examples cotton/polyester blend fabric, and
  mens white business shirts and dark socks

14
Commodity, Fashion, and Seasonal Goods

• Two main categories of merchandise
• Fashion products
• Always changing
• Last years model or style cannot be sold this
  year because it is not in demand
• Difficult to predict what the demand will be
• Wrong decisions result in huge financial losses
• Seasonal products
• Change in popularity or demand with the seasons
  of the year