Local Fashion Value Chains: Success Factors and Competitive Advantages

Globalization had forced fashion companies to move their manufacturing to low cost bases. However, in the recent times several challenges like poor transparency, ethical issues, high transportation costs, long lead times, etc. have motivated major reshoring initiatives. Steadily the fashion companies in the west are relocating back their production and are motivated by trends of greater product customization, supply chain transparency and digital technologies. In addition, several initiatives have been launched to support this development, for example the US initiatives: [TC]2 “Reshoring Fashion Initiative” and “Apparel Made for You”. However detailed scholarly discussion on what enables success of such local fashion value chain models are limited. This paper explores the drivers, critical success factors and competitive advantages in designing such local fashion value chains by drawing inferences from a European initiative called “fromRolltoBag”. An action research is employed to collect empirical data through observations and interviews with the project stakeholders. Results show that the competitive success lies in designing a consumer-driven, digitally-enabled fashion value chain, enabled by the strategy of differentiation through: (i) advanced digitalization of design and manufacturing operations, (ii) flexible, integrated and agile operations, and (iii) enhanced customer experience/interaction with the extended product-service system.