PRODUCT DEVELOPMENT – QUIZ 1Chapter 1 – The Role of Product Development in the Apparel Supply Chain Product Development The strategic, creative, technical, production and distribution planning of goods having a perceived value for a well defined user group! Apparel Supply Chain  How groups of suppliers form a partnership to create a given product Traditional/Linear Supply chain = outdated Fiber production  yarn manufacturing  textile production  apparel manufacturing  retailers  final consumer (it was distinct and separate process) Retail product development supply chain Price value “taking out the middle man” because it seeks to bypass the profit center of wholesale brand apparel manufacturers… and procure exclusive product at a competitive price *companies are all about bottom-line profit!! Ex: Macy’s – private brand INC, billion dollar business because started with products that customers wanted Product development manager Very good communication skills Works efficiently with suppliers Strong negotiation skills (know what you want and prepared to fight for it) Apparel supply chain structure TODAY More complex/flexible than the traditional linear model Builds on core competencies (what we do best) Digital technologies make it possible for companies to coordinate their core competencies into a single effort  speed to market Supply Chain Management (SCM) Is a competitive, customer-enriching supply system Deals with: logistics, supply chain strategy, supply chain planning, supply chain enterprise applications, asset management, procurement, and product lifecycle management (PLM) Product lifestyle management – once you get your desired product and it’s in stores, need to makesure its doing well (aka. The analysis of the product while it’s in stores!!) Li and Fung (7 key principles to their SCM philosophy) ONE OF BIGGEST GLOBAL SCM 1. Customer centric/market-demand driven 2. Focus on one’s core competency and outsource noncore activities 3. Develop a close, risk & non-profit-sharing relationship with business partners 4. Continuously improve the work flow, physical flow, information flow, and cash flow in the supply chain 5. Top technology to optimize operation of supply chain 6. Shorten production lead time and delivery cycles 7. Lower costs in sourcing, warehousing, and transportation PLM software Seasonal concept = business and marketing plans, concept/mood, color palette and materials/trims/silhouettes Line development = merchandising plans, line boards, material usage, market calendars and product tracking Definition: initial specification, adopted specification, production specification, special size specification Sourcing/costs = vendor collaborations, vendor allocation, multi-sourcing, estimate costing and quality Current Technology and Acronyms (Table 1.1, page 11) 3-D simulation  a system that provides a 2-d view of styles during product development, often with manipulation of digital human avatar to simulate garment performance in response to lifelike body movements. Use for consumer virtual “try on” or dressing room applications and to test pattern fit without or before making a sample application service providers (ASP)  web-based businesses hat offer individuals or businesses access to digital applications over the internet that would otherwise need to be purchased as specialty software computer-aided design (CAD)  an integrated information system that embraces all aspects of dealing with prospects and customers, including the call center, sales force, marketing, technical support, and field service to improve long-term growth and profitability through a better understanding of customer behavior. Customer relationship manager (CRM) a wide range of computer-based tools that assist design professional in rendering 2-D and 3-D concept sketches, product models and finished artwork. Applications for apparel product development include drawing flats for specification packages, visualizing garment models on avatars as well as designing textiles. Enterprise resource planning (ERP)  a system that integrate activities and transactions across functional departments including production planning and scheduling, materials purchasing, inventory management, logistics, distribution, and order tracking by serving as the base repository for cross-functional data to improve the performance of an organizations’ resource planning, management, and operational control. ERP systems were originally introduced as internal systems, but today many have SCM modules that coordinate functionality and share information through the supply chain. Markdown optimization solutions (MOS)  digital tools that allow retailers to plan and model markdown scenarios to achieve financial and inventory objectives. Merchandise lifecycle management (MLM)  system for collecting, storing, or analyzing data from sales transactions Point of sale (POS)  a system that builds on product lifecycle management functionality adapting it for the retail environment. MLM is a holistic approach enabling product developers to balance four criticaltasks: 1. Design products in less time to take advantage of market trends and fickle customerdemands 2. Source goods globally to meet price and delivery requirements, 3. Manage the manufacturing, quality, and logistics milestones in productions and 4. Deliver high-margin merchandise that sells through the initial markup Product lifecycle management (PLM)  a strategic business solution that supports the collaborative creation, management, visualization, dissemination and use of product definition information from initial concept to a product’s retirement throughout a company and its supply chain Radio frequency automatic identification (RFID)  a system that used radio frequency signals to locate and identify product with requiring a direct line of sight or contact. RFID systems are most often used for inventory tracking in distribution facilities but are increasingly being adopted for inventory control at the store level. Request for proposal (RFD)/ request for quotation (RFQ)  a document used to detail proposed gods or services requirements and invites responses and bids from prospective suppliers. Supply chain management (SCM)  software and web-based