The unofficial mascot of today’s apparel business may be the Pushmi-pullyu of Dr. Dolittle fame – a fictional animal with heads on opposite ends of its body.

In a nod to agility and environmental responsibility, several retailers, apparel manufacturers and brand owners are part of a small but growing movement toward small batch – in some cases on-demand – manufacturing, relying on consumer demand to pull desired goods into the marketplace rather than pushing masses of pre-selected products onto shelves.

Waste baked in
Waste is baked into the current system, says designer Misha Nonoo. “You are placing a bet on what people are going to want in six to nine months from now and have to invest cash up front producing that inventory,” she said. “Financial waste, and environmental waste, is just considered the cost of doing business.”

When the pandemic forced the closing of thousands of stores earlier this year, it left fashion retailers and suppliers with millions of dollars of inventory. For the most part, those goods either have been sold at deep discounts or warehoused for re-introduction in 2021. That experience intensified calls for less structured “seasonless” merchandising.

Inventory travails
Those inventory travails – plus a growing movement within the softlines business toward more responsible manufacturing —  may be setting the stage for more widespread use of small batch, on-demand manufacturing. Pre-pandemic, about 30% of apparel would be left unsold, but with on-demand presumably there would be little or no waste.

Fast fashion retailer Zara, unlike rivals H&M and Primark, has no chief designer but rather hundreds of them who quickly make decisions in response to fashion trends in a given market and deliver finished apparel in 4-6 weeks. And social-media savvy rivals such as Asos and Boohoo can deliver some apparel in two weeks with an online model that allows for super-lean inventory.

The shift comes at a cost. Apparel produced using shorter run, on-demand manufacturing can carry a 50% retail price premium to collections produced in volume, say licensing industry executives. Presumably, the higher manufacturing costs would be somewhat offset by less need for costly markdowns, so retail prices wouldn’t be driven up exponentially.

“The most difficult thing in on-demand is the increased price,” says Trevor George, CEO of print-on-demand supplier Trevco. “In the categories that large companies take inventory positions on, it is hard to break through because the consumer has been trained that the price should be around a certain level and if it’s above that, it is too expensive.”

And transportation costs are higher regardless of whether its “nearshore” or offshore, said McKinsey & Co., which cited a survey showing that 60% of fashion industry executives polled believed 20% of production would be brought closer to the market in which it’s consumed by 2025. The speed at which apparel gets to store shelves or consumers also will depend on how much of the supply chain is controlled by the individual company versus relying on outside suppliers.