JUNE 15, 2021

APPAREL
MERCHANDISING &
SOURCING AND
COSTING OF
APPAREL
PRODUCTS

End term jury submisssion

Submitted to
K. Anant Phani Sir

Submitted by
FannyGandhi
Pranjali Gupta
Ritanshi Singh
Srishty Dhanuka
(DFT - 6)
AM & SCAP // JUNE 15, 2021

02

ACKNOWLEDGEMENT

We would whole-heartedly like to

thank our AM &SCAP faculty, Anant
Phani Sir, for giving us this
opportunity to work on researching
the advantages various countries
offer in apparel manufacturing over
India and understanding the
terminology more deeply in supply
chain and retail in garment
manufacturing.

We learned a lot through this

assignment and this will help us
once we reach our industry as well.

We would also like to thank our

family and friends for constantly
supporting us in these tough times.
 03

ABOUT APPAREL
MERCHANDISING

Apparel merchandising refers to the techniques used to sell products

to consumers.
A merchandiser is someone who purchases a product from a
manufacturer, and then sells it to shoppers. There are numerous
techniques that a merchandiser may use to convince shoppers to buy
the products, he or she is selling.

ABOUT SOURCING AND

COSTING OF APPAREL
PRODUCTS
A basic decision in sourcing either materials or production is
whether to make or buy the desired product. Making involves
manufacturing their own raw materials and/or finished products
in the firm's own production facilities and buying involves
sourcing from vendors.
So the decision to make a product involves the capacity available
in-house of the manufacturer and desire to reduce costs,
availability of technology, and unsatisfactory supplier or vendor
performance.
The decision to buy a product from the vendors arises when
there is the availability of a product at a cheaper cost, non-
availability of the latest technology, and the inability to
manufacture such volumes in an in-house facility.
04
OUR PRODUCT
The product our group has chosen is
Women Sports Running Cycling
Fitted Shorts

Form- Fitting shorts developed exclusively for cyclists are

termed bicycle shorts. The material used for bicycle shorts is
typically a lightweight micro-denier or close-knit woven
fabric. Shorts are normally made up of four, six, or eight
distinct panels that have been seamed together to better
accommodate the contours of the lower body, and its sleek
shape slims the waist and hips.

Quality Requirement:
The fabric used is an explicit blend of Polyester, nylon,
and spandex with properties such as elasticity,
breathability, water resistance, quick-drying and
windproof.
For ultimate comfort, the garment is seamless without
any raised 'ridges'.
The sewing thread used should also have similar
properties and composition to comply with the fabric

As top competitors of our product, we've chosen China and

Bangladesh to perform SWOT analysis and decide our final
vendor.
05

CHINA
China is currently the largest global
textile exporter in the world. In 2020
China’s export value was approximately
$266.41 billion. Textile industries in
China grew after the 20th century.
Textile industries are booming With
government support and plan. With a
tremendous rise in profits, Chinese
textile companies are becoming a global
giant day by day. China is going to lead
the textile industry for many years.
06

SWOT ANALYSIS- CHINA

STRENGTH WEAKNESS

Growing Economy in the world. Strict Govt. Controls. Many formal

& informal rules.
High domestic market size.
Extra efforts & cost to expedite
The literacy rate is over 90%. delivery & quality control.
A massive trade surplus and huge Language Barrier
foreign exchange reserves.
Labor cost is increasing
Availability of Raw Materials
Good Logistics Infrastructure.

OPPURTUNITY THREAT

Increasing domestic consumption Pandemic crises

to stimulate economic growth.
Negative perceptions of Chinese
On-going urbanization as a major product quality, business dealings
drive.
Legal framework Imbalanced
Expansion of customers economic growth and
environmental
07

STRENGTH
China is an important export destination, a
supplier of cheap inputs and a serious
competitor in domestic as well as export
markets china is an important export
destination, a supplier of cheap inputs and
a serious competitor in domestic as well as
export markets china has some of Asia's
most advanced and effective import-export
infrastructure. Getting from one supplier to
the next is quite simple, whether you're
transporting freight or simply visiting your
suppliers. In terms of raw commodities,
China has a significant edge. For starters,
China has long been the world's industrial
center. Second, China is the world's most
appealing consumer market. Simply
because of these two considerations, there
exist vast stockpiles of all forms of raw
resources. The cheap labor also benefits
local businesses and the Chinese economy
because it provides more jobs to Chinese
citizens. The population may be vast, but
with the government-sanctioned, it makes
it easier to deliver changes in policies and
regulations to the citizens.
08

WEAKNESS
Despite China offering cheap labor which
provides jobs to the public, much of the
population is still unemployed.
Compared to the previous generation of
cheap, unskilled labor, the younger
generation of Chinese workers is better-
educated and more highly skilled, thus
demand better pay. This is compounded by
the country’s shrinking labor pool as the
generation responsible for China’s decades
of breakneck growth retire. Wage increases
in China’s garment industry have caused
some buyers to switch production for
simple garment products to neighboring
countries where local wages are low.

Then there’s trouble with governmental

control.
The Chinese government is known to be
restrictive. The price restrictions have led
to a decrease in residential home sales.
And construction businesses are slowing
down. With no homes to build and sell, the
construction industry is left to twiddle its
thumbs. With nothing to do, workers have
smaller paychecks and may leave the
industry to find work elsewhere.
09

OPPORTUNITY
China has one main opportunity to focus
on that is improving the service sector.

China has another primary area also in

which it should concentrate its efforts:
urban migration.

the country can emphasize service-based

businesses. This is necessary since
agriculture and manufacturing were the
two leading industries for the Chinese
industry until recently.
10

THREAT
The Chinese suffer because of negative
perceptions. The closed nature of the
Chinese government, their growing
economic might, and the high population
rate has all created a negative image of
China amongst other cultures of the world.
For garment industries in China, the
biggest problem is a quota, which means
that there are limitations for export
quantity. The other threat is about 27 the
policy of exchange rate and foreign trade.
The changing of policy creates difficulty
and pressure for our case company,
especially the exchange rate between US
dollars. China, Japan, and South Korea
have been at loggerheads with each other
regarding their economic zones in the East
China Sea. The changing of policy creates
difficulty and pressure for our case
company, especially the exchange rate
between US dollars. China, Japan, and
South Korea have been at loggerheads
with each other regarding their economic
zones in the East China Sea. This is
creating hassles for trade and commerce in
all the three countries.
11
BANGLADESH
In Bangladesh, RMG is the most important
industry. In comparison to other high-tech
industries, it is primarily a labour-
intensive business that requires little
financial investment and relatively simple
technology. Over the previous two
decades, Bangladesh's Readymade Garment
(RMG) exports have outperformed even the
most optimistic predictions being the
highest foreign currency earning sector.

Apart from that, it is the largest source of

employment generation in the country
involving around 90% of distressed women
in their workforce and helps in poverty
alleviation.
12

SWOT ANALYSIS- BANGLADESH

STRENGTH WEAKNESS
Labour and energy cost are
comparatively low Longer Lead Time
Easily accessible connectivity and Lacks marketing tactics and
telecommunications training organizations
FDI is legally permitted Deficient in creativity with a small
number of manufacturing methods
Decades old fundamental infra
estd. by Korean, Taiwanese, and Incompetent ports and time-
Chinese industrialists consuming custom clearance
The convenience of duty-free
custom bonded warehouses
Member of MIGA
OPPURTUNITY THREAT

Expected to enhance export trade Competitors like china with better

with The EU and us leading to infrastructural facilities
better home capacities for RMG
sector Loosely maintained environmental
Port management will go into standards
foreign hands reducting handling Unethical standards like child
charges labour and poor work conditions
Political stability will lead to
smoother trades
Good prospectus for Knit-RMG in
the coming period
13
STRENGTHS
Bangladesh has earned popularity for its big
capacity and ability to manufacture low-end items
at the cheapest rate of the world with an
acceptable quality
The cost of labour in Bangladesh ranges between
$110 to $120 which is ~80 per cent less than
China’s and ~40 per cent less than India’s. Other
costs such as power, water, and lending rates are
also significantly less than China, which makes
Bangladesh an attractive sourcing hub for buyers.
It has easily accessible infrastructure and
connectivity via sea, rail and air with a wide range
of ports.
FDI (Foreign Direct Investment) is legally
permitted.
Bangladesh today has a big pool of highly skilled
and semi-skilled workers. Furthermore, there are a
large number of unemployed young men and
women who can readily be transformed into
skilled workers if necessary.
Given the industry's steep learning curve,
substantial expertise dealing with international
buyers, offshore lenders, shippers, and Clearing
and Forwarding (C&F) agents is a key asset.
Excellent telecom, weakness of currency against
dollar/euro and the convenience of duty-free
custom bonded w/house are some other
advantages that the country possess.
Bangladesh is a member of the Multilateral
Investment Guarantee Agency (MIGA) under which
protection and safety measures are available.
14
WEAKNESS
Dependence on others for raw materials, low
productivity, little knowledge of worldwide
marketing information, weak infrastructure, and
political instability are all factors to take into
account. The industry's key flaws are disruptive
trade unionism, inefficient port administration,
and heavy reliance on the RMG sub-sector. For
raw goods such as textiles (gray fabric) and
accessories, the industry is extremely reliant on
countries like India, China and Thailand under
back-to-back L/Cs.
With equal access to the global market, these
direct competitors will either stop selling
supplies to their competitors, such as
Bangladesh or charge higher rates for their
materials (a strategic move) (because of
increased internal demand),
Because foreign buying houses have dominated
the marketing side of the company, Bangladeshi
exporters have little access to current market
intelligence and international trade knowledge.
Port Management is another serious challenge
for the Bangladeshi RMG industry as their chief
port Chittagong is one of the most inefficient
and corrupt ports of the world with unreasonably
high handling charges.
Besides, various demands for "under-the-table"
payments reportedly required at every step of
export processing seriously hamper their
competitiveness in the global market.
15
OPPORTUNITIES
The EU is eager to promote the industry as a
viable alternative to China, particularly in the
area of knits, such as sweaters which will benefit
the countries capabilities.
Because labour and energy costs are low, the
prearranged garment is an alternative if
competent specialists are available to train.
The importance of foundation clothes for ladies
for the FDI promise is crucial since both
technicians and highly advanced machines are
required for improved competence and output
Japan to be observed, as they traditionally
acquire handloom textiles, home furnishings, and
clothing. With continuing improvement in quality,
this part can be encouraged and extended.
The port of Chittagong will be given over to a
foreign operator, which will improve service, cut
lead times, and lower overall costs.
Bangladesh will achieve political stability, which
will facilitate foreign trade and increase the
confidence of foreign buyers.
It will also be a plus point for trade relations
between India and Bangladesh as they lack
similarity in their mutual export to import ratio
generating a constraint of complementarity.
16
THREATS
China is most likely Bangladesh's main threat, as
it has higher workforce productivity and employs
more capital-intensive modern technology, as well
as shorter lead times because of its relative
advantages in obtaining locally accessible raw
materials such as fabrics and various RMG
accessories.
Infrastructural facilities, such as energy supply,
are also superior in China. system of
transportation and communication
Under the AOA act (Agreement On Agriculture),
some African and Caribbean nations have
benefited from a zero-tariff facility, making them
more competitive in comparison to Bangladesh.
Environmental difficulties, labour standards,
Trade-Related Aspects of Intellectual Property
Rights (TRIPs), and other issues could pose a
serious danger to developing countries such as
Bangladesh. In Reza's own words. Although
developing countries are not singled out for
environmental difficulties, due to their poverty,
they are unable to maintain strict environmental
standards.
Child labour and poor working conditions are
sensitive issues that may affect severely for
rigorous standards.
Another threat to the industry is Regionalism.
17
RESULT
Post this critical SWOT analysis and weighing all
the pros and cons of importing our product from
either of these two different countries i.e., China
and Bangladesh, that China will be our preferred
vendor for buying Cycling shorts of required
acceptable quality as they have homegrown
availability of premium raw material and are well
equipped with advanced technologies in their
industries. Bangladesh, on the other hand, despite
cheap labour and energy costs deliver with a
longer lead time and the port's management isn't
up to the mark either.

The apparent barrier that importing from china

can have, provided that their samples have cleared
our quality standards, is the relation of the
country with India. If that goes any further
downhill, we will have to seek other vendors for
our order.
18
SUPPLY CHAIN
MANAGEMENT IN
APPAREL

In today's world of business, the environment has

undergone drastic changes, and has become more
competitive than ever before.
With the increasing reach of media, and globalization
of business, one country’s products are available in
other countries in a wink.
SCM (Supply Chain Management) aids the
organization to evaluate their entire operation, and
restructure it in such a way, that, they can focus on its
core competencies.
It also aids the business in outsourcing those
processes, which is out of bounds of their core
competencies.
Selecting the appropriate system of SCM will not only
enhance the company’s market position, but also
provide them with strategic decisions in choosing the
right partners, manpower and resources.
19
SUPPLY CHAIN
MANAGEMENT IN
APPAREL
Supply Chain Management is the integration of key
business processes from end user to original suppliers
that provides products, services, and information that
add value for customers and other stakeholders.

Supply chain management deals with not only supply

from manufacturers, but also demand from consumers
filtered through various agencies.

Apparel organizations need to effectively manage the

entire supply chain keeping both optimization of
inventory level and fast responsiveness to market
demand in mind.
20
BULLWHIP EFFECT
WHAT IS BULLEWHIP EFFECT?

Imagine a person having a long whip in his hand, and if

he gives a little nudge to the whip at the handle, it
creates little movements in the parts closest to the
handle, but parts further away would move more in an
increasing fashion.
Similarly, in the supply chain world, the end customers
have the whip handle and they create a little
movement in the demand which travels up the supply
chain in an increasing fashion. As we move away from
the customer, we can see bigger movements. On
average, there are six to seven inventory points
between the end customer and raw material supplier
(as shown below in figure 1).

Everyone tries to protect themselves from stock-out

situations and missed customer orders, by keeping
extra inventory to hedge against variability in the
supply chain.
Hence, huge buffers of inventories up to six months
can exist between the end customer and raw material
supplier.
This bullwhip effect ultimately causes the upstream
21
manufacturers to have increased uncertainty which results in
lower forecast accuracies leading to higher inventories.

To understand more about the effect, we should first have a look

at the definition.

Definition
The bullwhip effect is a concept for explaining inventory
fluctuations or inefficient asset allocation as a result of
demand changes as you move further up the supply
chain.
As such, upstream manufacturers often experience a
decrease in forecast accuracy as the buffer increases
between the customer and the manufacturer.

AN EXAMPLE OF BULLWHIP EFFECT

The actual demand for a product and its materials start at
the customer, however often the actual demand for a
product gets distorted going down the supply chain. Let’s
say that an actual demand from a customer is 8 units, the
retailer may then order 10 units from the distributor; an
extra 2 units are to ensure they don’t run out of floor
stock.
The supplier then orders 20 units from the manufacturer;
allowing them to buy in bulk so they have enough stock to
guarantee timely shipment of goods to the retailer.
22
The manufacturer then receives the order and then
orders from their supplier in bulk; ordering 40 units to
ensure economy of scale in production to meet demand.
Now 40 units have been produced for a demand of only 8
units; meaning the retailer will have to increase demand
by dropping prices or finding more customers by
marketing and advertising.

WHAT CAUSES THE BULLWHIP EFFECT?

The bullwhip effect can be caused by a huge number of
contributing factors, but some of the most common causes of
the bullwhip effect include:
1. Forecast errors – Decisions in every link of the supply
chain are made based on demand forecasts for
businesses. Errors in forecasting lead to miscalculations
that are magnified as they move up the supply chain.
2. Order batching – Placing frequent orders for small
quantities creates less of a bullwhip effect than placing
larger orders less frequently. With order batching, the
retailer places orders with its supplier once per month
(rather than several times throughout the month), which
creates inconsistent demand for the supplier over time.
23
3. Lead time – Lead time is the span of time between when
an order is placed and when it’s received. Failing to consider
lead time when managing inventory can lead to an
overstocking of products, which in turn results in a change in
supplier demand over time i.e. the bullwhip effect.
4. Sales and price discounts – Sales and discounts create a
boom-and-bust cycle. Lots of product moves during the
promotional period, which is followed by lower levels of sales.
This cycle ripples through the supply chain, resulting in the
bullwhip effect.

The bullwhip effect exists in all supply chains and is the root of
the boom-and-bust cycles in many operations. Left unchecked, it
can have detrimental effects on a business, which is why it’s so
important to manage it proactively.

WHAT HAPPENS WHEN THE BULLWHIP EFFECT

HITS THE SUPPLY CHAIN?
Just as fluctuations in demand ripple throughout the entire
supply chain, the bullwhip effect can have serious
consequences throughout all aspects of business:

·Too much stock on hand, leading to increased inventory

holding costs
·Unfulfilled orders
·Poor customer service
·Lost revenue
·Misguided demand forecasts
·Missed production schedules
24

HOW TO MINIMIZE THE BULLWHIP EFFECT

Every industry has its own unique supply chain, inventory
placements, and complexities. However, after analyzing the
bullwhip effect and implementing improvement steps,
inventories in the range of 10 to 30 percent can be reduced
and 15 to 35 percent reduction in instances of stock out
situations and missed customer orders can be achieved.

Below are some of the methods to minimize the bullwhip

effect.
1.Accept and understand the bullwhip effect
The first and the most important step towards
improvement is the recognition of the presence of the
bullwhip effect. Many companies fail to acknowledge that
high buffer inventories exist throughout their supply chain.
A detailed stock analysis of the inventory points from stores
to raw material suppliers will help uncover idle excess
inventories. Supply chain managers can further analyze the
reasons for excess inventories, take corrective action and
set norms.
25
2.Improve the inventory planning process
Inventory planning is a careful mix of historical trends for
seasonal demand, forward-looking demand, new product
launches and discontinuation of older products. Safety
stock settings and min-max stock range of each inventory
point need to be reviewed and periodically adjusted.
Inventories lying in the entire network need to be
balanced based on regional demands. Regular reporting
and early warning system need to be implemented for
major deviations from the set inventory norms.

3.Improve the raw material planning process

Purchase managers generally tend to order in advance
and keep high buffers of raw material to avoid disruption
in production. Raw material planning needs to be directly
linked to the production plan. Production plan needs to be
released sufficiently in advance to respect the general
purchasing lead times. Consolidation to a smaller vendor
base from a larger vendor base, for similar raw material,
will improve the flexibility and reliability of the supplies.
This, in turn, will result in lower raw material inventories.

4.Collaboration and information sharing between

managers
There might be some inter-conflicting targets between
purchasing managers, production managers, logistics
managers and sales managers. Giving more weight to
common company objectives in performance evaluation
will improve collaboration between different departments.
Also providing regular and structured inter-departmental
meetings will improve information sharing and decision-
making process.
26
5.Optimize the minimum order quantity and offer
stable pricing
Certain products have high minimum order quantity for
end customers resulting in overall high gaps between
subsequent orders. Lowering the minimum order quantity
to an optimal level will help provide create smoother order
patterns. Stable pricing throughout the year instead of
frequent promotional offers and discounts may also
create stable and predictable demand.
27
REVERSE LOGISTICS
When a manufacturer's product such as clothing, shoes,
handbags, or accessories normally moves through the
supply chain network, the ultimate destination is a
clothing store or a consumer.
If the product for some reason has to return in the
opposite direction of the supply chain, it would be reverse
logistics.
For example, if the retail store found garments to have
damages, they may require the wholesaler to take back
the merchandise. The process of returning the clothes to
the distributor is part of the reverse logistics process.
Any process or management after the sale of the
product involves reverse logistics.
If the product is defective, the customer would return the
product. The manufacturing firm would then have to
organize shipping of the defective product, testing the
product, refurbishing, dismantling, repairing, recycling or
disposing the product.
The product would travel in reverse through the supply
chain network in order to retain any use from the
defective product. The logistics for such matters is
reverse logistics.
Concept of reverse logistics (RL) has been on the top
priority for researches as it works towards reducing
operating cost as well as give opportunity for firms to
explore new market.
Statistics reveal that around 20% of everything that is
sold in America is returned.
Although reuse is a hit but surprising this part of the
supply chain, known as reverse supply chain or backward
supply chain is less attended phenomenon.
28
A very common example of reverse supply chain is the
soft drinks bottles pickup and delivery system,
where soft drink bottles are returned and reused
repeatedly.

Companies were so long under the impression that

returns generate little or no money.
However, with the growth of direct-to-consumer channels
like catalogs and internet sales, returns of fashion
merchandize by the consumers have increased.
Increased sales have increased the overall percentage of
rejections also, thus, there is growing recognition of the
value that can be recaptured from return merchandize,
among all the industries.
An Idealo study indicates that fashion items and
accessories are among the second most returned (at
23%), even though their demand stands at just over 11%.
41% of Spanish consumers thoroughly check the return
policy of an e-commerce site before deciding whether to
make a purchase or not; and Research Now suggests that
51% leave the purchasing process in the event that
they are not convinced by the returns policy of the
website where they are buying.
It is very important to have a clear return policy and to
make it easier for end users to return the package they
want to return, which is essential in order to maintain the
trust of e-commerce users.
29
COST FACTOR IN REVERSE LOGISTICS
When products and materials move backwards in the
supply chain, they incur costs, which then affects total
revenue numbers.
However, these inbound logistics costs are typically
dispersed across the entire organization instead of
being assigned to a cost center like other
manufacturing and selling costs.
As a result, the complex costs of reverse logistics often
go unchecked, diminishing margins. Total cost of
ownership (TCO) aims to control these costs by
integrating all aspects of the supply chain to share
responsibility organization-wide.

Common types of Reverse Logistics costs include:

1. Cost of Returns
2. Cost of Transportation
3. Cost of Repairs
4. Cost of Service
5. Cost of Reselling

1. COST OF RETURNS
As returns increase, customer service expenses
increase as well because more labor is required to
handle return requests, check the status of returns, and
process claims.
Transportation costs result when products are taken
back and sent elsewhere even if they are only moved
over a short distance.
Receiving and warehousing costs are then incurred
when returned products are logged into facilities and
stored.
30
When documentation errors occur during receiving,
additional costs can result because finance teams must
do additional work to reconcile the accounting issues that
follow.
2. COST OF TRANSPORTATION
Logistics is most often concerned with how long it takes
to get products to retail stores or into consumers’ hands.
Typical analyses look at whether the cost of air freight is
worth it to increase customer satisfaction, and other clear
cost-benefit scenarios.
However, reverse logistics examines less obvious angles
like the cost of bringing back unsold merchandise from
retail stores or recycling packaging components.
In some industries, these reverse transportation costs
can be just as high as their forward transportation
counterparts.

3. COST OF REPAIRS
Determining where to locate repair centers is a hot topic.
It is typically more cost effective to have fewer repair
locations.
Regardless of the industry, repair centers of all kinds
carry hefty price tags that outweigh the ongoing costs of
inventory transportation.
Within each repair center there are nuanced reverse
logistics costs to account for as well.
For instance:
Stocking inventory comes with a carrying cost that must
be analyzed to determine where appropriate thresholds
exist.
Storing excess inventory comes at the opportunity cost of
occupying valuable space and running the risk that
inventory will become obsolete before it can be utilized.
However, not stocking enough inventory can result in
downtime when required parts are unavailable to
complete repair work.
31
4. COST OF SERVICE
Like repair centers, the location of service centers is
an important decision because it affects overall
profitability.
However, service centers have unique considerations as
well, such as service level guarantees.
For products that include specified service levels, the
logistics throughout the supply chain need to work
together flawlessly to meet customers’ expectations every
time a product is serviced.
Inventory, transportation, staffing, training, and customer
communications all come together to deliver expected
service outputs.
At each step inbound logistics can determine where
service gains may be made if individual components are
changed.

5. COST OF RESELLING
Refurbishing products is a reverse logistics approach that
many companies use to extract residual value from
existing inventory.
While common, refurbishing is not the only method of
reselling products.
Returned products can also be resold if they are in good
condition.
However, inspecting products, repairing damage or
replacing defective parts, and repackaging them takes
time and materials.
These costs are all included in the reverse logistics
calculation of reselling products.

Inbound logistics costs are complicated to measure and track, but

automation can simplify the complexities.
Assimilating technology across manufacturing and product fulfillment
provides a logistics backbone that improves all supply chain efforts.
32
EXAMPLES OF REVERSE LOGISTICS
1. Apple
Apple is a fantastic example of a successful reverse
logistics system. Apple manufactures iPhones and
other products, which are then sold in various stores
across the world.
Consumers purchase iPhones and enjoy the product
until they want to upgrade their product. When
consumers return to a store to buy the latest model,
Apple offers consumers discounts on a new product
if they return their old product.
Apple then collects the old models and brings the
products back to their factories.
This process allows Apple to use parts from previous
models in their newer products, helping Apple be
more environmentally friendly and save money on
production costs.

2. H&M
H&M accepts used clothing at all of their stores
worldwide.
The clothes can be any condition or brand, and H&M
will use the clothing they’ve collected to create an all-
recycled clothing line.
This type of reverse logistics chain allows all types of
consumers to get involved with the brand, even if
they didn’t purchase their garment from H&M.

3.Dasani
Dasani is an excellent example of reverse logistics
because they have implemented several easy ways to
collect and recycle their used products, including
Dasani Bottle Bins on school campuses across the
United States.
33
Consumers place their empty Dasani bottles in the
bins and Dasani is able to collect and recycle the
bottles.

BENEFITS OF REVERSE LOGISTICS

Companies use reverse logistics to implement proper
product disposal, to retrieve parts, or to refurbish used
products.
Reverse logistics can also help a company reduce waste
and improve their environmental footprint.
Reduce environmental impact: Reverse logistics
is an excellent strategy environmentally-friendly
companies should employ. Reverse logistics keeps
reusable materials out of landfills and allows your
company to be in control of safely disposing your
products in a way that reduces harmful waste.
Lower bills: By re-collecting your products, you can
reduce materials costs. Reusing pieces of your old
products can help lower your overall material cost
and reduce your environmental footprint.
Be prepared: Unfortunately, there are instances in
which companies must issue a recall. If your
company already has an efficient reverse logistics
system in place, reaching customers and collecting
recalled products will be much easier.
We can conclude after all the points above that reverse
logistics matters equally or more compared to forward
logistics in supply chain, especially in today's time when
majority is shifted to trial-less shopping, i.e. online,
therefore there are increased chances of rejection in fit,
style or size!

Even though it's a ton of extra work but it's really crucial
to have a fool-proof reverse logistics system, for you to
survive and compete in today's business world!
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BIBLIOGRAPHY
https://www.newcastlesys.com/blog/the-
hidden-costs-of-reverse-logistics
https://www.allthingssupplychain.com/reverse-
logistics-101/
https://www.logisfashion.com/en/the-
challenges-of-reverse-logistics-in-the-online-
fashion-sector/
https://www.fibre2fashion.com/industry-
article/3315/apparel-supply-chain-and-its-
variants
https://en.wikipedia.org/wiki/Bullwhip_effect#:~
:text=The%20bullwhip%20effect%20is%20a,fur
ther%20up%20the%20supply%20chain
https://blog.arkieva.com/what-is-bullwhip-
effect/
https://www.cips.org/knowledge/procurement-
topics-and-skills/operations-
management/bullwhip-effect-in-supply-chain/

THANK YOU!