3 Reasons Why Fashion Brands Need Flexibility in Fulfilment

Here at Whistl, we use the word flexibility a lot, mainly because that’s what we offer, in abundance. But why is it so important to fashion brands and retailers? Let's examine an example of how flexibility can help boost sales, increase efficiency, and reduce costs for emerging fashion brands.

1. Managing Sudden Demand

Kate owns an emerging clothing brand, and sales are consistently around 150 orders per day from approximately 500 SKUs. Kate employs a warehouse team to manage her own rented warehouse, which remains fully occupied at around 90% throughout the year.

It’s Monday morning, the marketing team have just barged into Kate’s office to announce that one of her jackets has been featured in Glamour Magazine. That afternoon, she received an additional 1000 orders of these jackets via her eCommerce store. Luckily, they’re in stock. However, it will take up to 8 days just to fulfil these orders with the current level of staff and facilities Kate has. Customers won’t be happy.

So what are Kate’s options?

Well, firstly, she could reallocate staff within the warehouse to get more pickers and packers. She can offer overtime to staff to reduce this delay, or she could hire temporary warehouse staff to boost resources.

In every case, there are downsides. Reallocating staff will reduce the performance of other warehouse areas, which may cause goods to be delayed reaching the pick face. Stock replenishment may also be delayed, potentially affecting stock availability on the website. Offering overtime to staff is probably the best bet, but this adds cost, and will reduce the margin made on the sale of those 1000 jackets. Hiring temp staff is time-consuming and possibly expensive. Unless there is a bank of regular temp staff who know the operation, this probably isn’t a viable option.

Where flexibility can help

In this case, having a flexible e-fulfilment warehouse with inventory management allows brands to meet demand for unforecasted sales. Here at Whistl, for example, handling increased demand on a daily basis is the norm. As we operate in a multi-client environment, we can allocate our warehouse team across the various clients we serve. An in-house warehouse may not have the ability to react so quickly, nor incur additional costs.

2. Managing Sales Growth

Let's say that following the feature in Glamour Magazine, the Sunday Times Style Supplement then features Kate’s skirts. Another 2,000 orders follow suit, and daily orders quickly rise to 350, consistently. What does Kate do now? Should we continue paying overtime, or employ more warehouse staff? Again, both of these come with added costs. What if that demand decreases again in 2 months?

Where flexibility can help

Having a flexible fulfilment operation allows brands to manage this increase in daily orders without increasing overheads on staff or equipment. At Whistl, for example, we manage daily order volumes ranging from as low as 1,000 per day across our clients to as many as 20,000. Our clients pay for their activity, not for the staff who work on their campaign. This variable cost model can save a considerable amount compared to staff overheads.

3. Managing an Expanding Product Range

Kate’s fashion brand has had a good year. After featuring in various fashion magazines, order volumes have jumped to 500 per day. Kate’s employed more warehouse staff to cover this demand, adding to her overheads. However, she now wants to add a new range of handbags and accessories to her product line. Problem!! The warehouse was operating at 90% of capacity 6 months ago, long before the increase in orders. Kate doesn’t have the space to store a new product range. She wants to grow the business, but she’s now constrained.

Kate does have options. She could remove some of her product lines to cater to the new ones. She could rent an additional warehouse and move stock across two units. She can relocate from her current warehouse to a larger facility. She could even buy a new warehouse.

Where flexibility can help

In each of the above options, costs could spiral out of control. Renting an additional warehouse causes logistical problems. Let's say a new warehouse becomes available next door to her current unit. That’s the ideal scenario, but having stock located across two units will still add time to the order fulfilment process and possible complexity. It’s certainly not the most efficient scenario. Renting a larger warehouse would seem to be the most logical step. Still, the cost of setting up this new warehouse, including additional racking, shelving, IT, and systems, can incur significant setup costs. The same applies to buying a warehouse, that’s even before you add the price of the purchase itself.

By outsourcing fashion fulfilment, Kate can increase her storage capacity at the fulfilment company without adding any additional fixed costs. This allows Kate to add an almost unlimited number of additional products to her range. With a variable cost model, an order fulfilment company will charge by the pallet stored, rather than per product. This allows Kate to add new lines as often as she’d like.

It’s clear that a flexible fulfilment operation, led by an outsourced partner, offers many physical benefits to fashion brands and eCommerce stores. You can learn more about our Fashion e-Fulfilment services here. Get in touch to discover how we can support your business and enhance your fashion brand.