It is important for brands and manufacturers to stay relevant in the apparel business to survive in a highly competitive business environment. The apparel industry is constantly evolving and is subject to a number of changes multiple times during the year. These changes typically include weather, social trends, lifestyle trends, couture influences, etc. While operating in such a dynamic industry, it can often get difficult for apparel brands to keep up with all the changes and sustain themselves. Hence, listed below are five strategies that apparel businesses should follow to improve their profitability:
1. Improve the product portfolio
The key to surviving and maintaining profitability in the apparel business is by improving and increasing the product portfolio as and when required. For instance, during the pandemic, many apparel lines started their own product lines of masks and converted something that is a necessity into a fashion statement. In addition to that, companies need to create multiple product lines such as t-shirts, formal shirts, trousers, denim, etc. They may also need to specialise their manufacturing process by building up a factory-within-factory system where different departments are dedicated towards a certain task in the manufacturing process.
2. Consider vertical integration
Apparel businesses should consider forward or backward vertical integration as it leads to an improvement in the business's supply chain and leads to several cost benefits. Bigger apparel businesses may consider investing in textile manufacturing and printing, and textile manufacturers on the other hand need to focus on garment production and large-scale exports.
3. Improve customer service
To maintain profitability in the apparel business or in any business for that matter--it is important that you improve your companys customer service. This involves answering email queries, responding to in-store complaints and conducting follow-ups when required. While technology and globalisation has made it easier for other apparel businesses to copy designs and replicate items overnight, something that is not replicable is good customer service.
4. Consider other investments too
While apparel businesses earn mainly through sales or franchise profits, they should also consider making other investments such as those in the realm of real estate, or stock trading. While apparel businesses and stock trading may not sit right for some individuals, it is in fact very beneficial for businesses to diversify and not put all their eggs in one basket. Finance managers at apparel businesses should consider using Saxotrader for trading securities such as ETFs or exchange traded funds.
5. Work on employee morale
Your employees are crucial to your productivity and your growth and hence you need to ensure that your organisation is a place that your employees enjoy working in. The work atmosphere should inspire creativity and allow them to learn and sharpen their skills. If your employees are productive, you are sure to maintain profitability irrespective of the industry you operate in.
While the apparel business is dynamic and fast-paced, it poses a lot of profits and growth for businesses and managers that understand the running dynamics of operating an apparel company. The above strategies are crucial for businesses looking to grow in the apparel industry.
