Substance of the Fashion Industry Fashion Marketing Chapter 4
Mar 29, 2015
Substance of the Fashion IndustryFashion MarketingChapter 4
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
Fashion merchandisers should understand the processes, timing, and practices of the individual segments or groups within the overall fashion industry
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
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
Apparel Produces finished garments and
accessories Steps in the Apparel Segment
1. 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
Apparel Steps in the Apparel Segment
2. 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
3. Apparel sales involves selling the manufactured garments in large quantities to retail stores
Apparel Resellers – wholesalers who serve to
distribute goods between producers and retailers or users
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
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
The Four Groups Approach Separates the fashion industry into 4
main groups of business:1. Primary group (raw materials: textiles,
leathers, furs)2. Secondary group (manufacturing:
garments, accessories)3. Retail group (final distribution; stores
catalogs, internet, TV sales)4. Auxiliary group (fashion-related; trade
associations, publications, and consultants)
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.
Commodity, Fashion, and Seasonal Goods Two main categories of merchandise
Commodity products Staple goods…hardly ever change in design
and are in constant demand…sales are predictable Examples: cotton/polyester blend fabric, and
men’s white business shirts and dark socks
Commodity, Fashion, and Seasonal Goods Two main categories of merchandise
Fashion products Always changing Last year’s 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