- In a one-off pilot experiment, Ralph Lauren delivered a custom fleece sweater to a wholesale customer in 16 days from ideation to receipt "right in time for Black Friday", COO and CFO Jane Nielsen said on the company's third-quarter earnings call Tuesday.
- The garment was manufactured in mainland China, said CEO Patrick Louvet, and he believes the process is replicable.
- "It's a pilot, but I think it's an indication also that our organization is becoming more agile, more aggressive in terms of how we manage timelines and also more creative," he said.
Apparel lead times generally span several months. But the rise of fast fashion companies built around quick lead times, short production runs and faster inventory changeovers has encouraged legacy brands to behave more like their younger competition.
Shortening lead times has become an important goal for apparel companies across categories from Nike to Urban Outfitters to Kohl's. Doing so offers more flexibility to meet consumer demand and often means having less inventory on hand (an issue plaguing the apparel industry). By industry standards, fast is roughly 60-120 days. Sixteen is another kind of fast.
In order to shorten lead times to this degree, a brand would need design capability, fabric availability and production partner schedules and skills to come together perfectly. Easier for a one-off pilot where the brand could gain support and buy-in internally and externally.
"We're not going to move our entire supply chain to 16 days," said Louvet. The value of being able to turn around a new product in so little time is to understand what such a feat takes, should an opportunity arise and the company wish to seize it quickly. Louvet assured that the company still has 30-, 60- and 90-month lead times for the most part.
But Ralph Lauren will likely speed up its lead times, specifically when that's "what's required to win in the marketplace," said Louvet.
A 2018 McKinsey study found vertically-integrated apparel companies, meaning those who control design, production and sales channels, are better-equipped to shorten lead times. Of the 54 apparel executives surveyed, vertical apparel companies reported an average lead time of 28 weeks while hybrid players who sell through their own channels and through wholesalers (as Ralph Lauren does) averaged 44 weeks. Though this one sweater was a small scale pilot, Ralph Lauren beat those odds.