Is on-demand manufacturing the solution for a greener fashion industry?
As the fashion industry grapples with the pressing issue of waste reduction, brands are increasingly turning their attention to innovative solutions that can be implemented on a broader scale. One of these is on-demand manufacturing.
A growing number of made-to-order brands includes Australian-based Citizen Wolf, Spanish fashion label Alohas, Benjamin Fox and Olivia Rose.
How does it work?
Roger Lee, CEO of TAL Apparel, told Inside Retail the traditional manufacturing process forces brands to make their purchasing decisions six to nine months in advance, essentially forecasting future demand. This approach often leads to excess stock and end-of-season markdowns for unsold items, resulting in discounted products that may not align with genuine consumer needs.
“Even after these price reductions, retailers frequently face the challenge of clearing out unsold inventory to accommodate new seasonal products, leading to considerable waste,” he added.
In contrast, on-demand manufacturing operates on the principle of producing only when a customer expresses interest in a specific product.
“This approach effectively eliminates waste by preventing excess inventory in stores or warehouses. It represents a more efficient model that addresses a fundamental inefficiency in the current retail system,” he said.
“Secondly, with on-demand manufacturing, you can ship products directly to customers or stores for pickup when ready, bypassing warehouses. Currently, goods are shipped to ports, sent to warehouses, and stored until needed before being shipped out.”
Why does it help?
According to Lee, made-on-demand simplifies the logistics network, saving costs by eliminating warehousing, reducing manpower, and cutting electricity usage. This streamlined process is more efficient, resulting in less waste and simplified logistics.
“New brands starting with made-on-demand have an advantage, as they can operate with smaller showrooms instead of large stores and don’t need extensive warehousing,” Lee said.
“From a customer’s perspective, made-on-demand offers more choice. Traditional stores stock vast inventories to avoid disappointing customers, but made-on-demand allows for customisation. Customers can modify details like button colours, pockets, or sleeve lengths to suit their preferences or body shape. This level of personalisation isn’t possible with off-the-rack items.”
Underlying issues
Given all of these benefits, why isn’t made-on-demand more popular? One potential reason is that the longer production time leads to the higher price for made-on-demand products.
“For our shirts, pants, and polos, it takes four days to produce. That’s from the day the customer places an order to the day it finishes production,” Lee said. “After that, it depends on logistics. Some customers group orders together and only ship once a week, while others with high volume ship daily. So the logistics time varies. Typically, for a shirt or polo, from the time a customer orders to when they receive it at home, it’s about 10 to 14 days.”
He noted that air freight is necessary to deliver orders quickly, as production takes about a week.
“This raises questions about sustainability. While I don’t have exact figures, there’s debate over which method is more environmentally friendly. Made-on-demand eliminates waste and reduces logistics, but requires air freight. However, the shipped items are typically light and small in volume,” he said.
Moving production closer to customers would provide a long-term solution to this problem.
“Ultimately, I believe consumers will drive the shift towards made-on-demand,” Lee said. “They’ll increasingly seek unique, well-fitting products that make them look good. As more brands adopt this model and it gains popularity, consumers will likely consider made-on-demand options before traditional off-the-rack purchases. This trend has enormous potential and will only grow.”
Is it worth the wait?
While some consumers are always going to shop with delivery speed and price in mind, there is a growing segment of consumers for whom quality and fit are important, said Christina Dean, founder of Redress.
“Consumers who are looking for a good fit and quality for key items – like dress shirts or suits – are certainly willing to wait” for clothing that is made-on-demand, she said.
“That said, many consumers are not actually shopping for ‘clothes’,” she added. “Some might be shopping to cure a myriad of other issues, from boredom to insecurity, and so the quick ‘fix’ of immediate shopping and the dopamine response they get from that might be the biggest draws. Made-on-demand product is likely not going to delight the dopamine receptors as much here, unfortunately.”
Scalability
Although the made-on-demand model appears to be a viable solution, concerns regarding its scalability remain to be addressed.
“I think it’s definitely scalable if a brand decides to commit to it,” Lee said. “It’s always a priority for brands, but it requires a lot of IT and technology work to start.”
The other barrier is measurement. Consumers must provide accurate body measurements to ensure the finished products fit properly, but this can be challenging.
“You can offer many options, but you don’t want to overwhelm customers. Brands need to think carefully about merchandising and curating options,” Lee said. “The problem is that people like options, but not too many – too many options can lead to decision paralysis. So it’s a very different way of thinking about how to sell a product, but it’s definitely scalable.”
Meanwhile, Dean believes made-on-demand manufacturing is only going to increase in popularity, particularly when more consumers clock on to the benefits of getting well-fitting clothes – at a relatively simple click of a button.
“I think some consumers are becoming saturated with the mass market, and the desire to have customised clothes, and a more unique identity, are here to stay,” she said.
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