Supply chain management is seen as a critical factor in managing
contemporary readymade garment business.
Traditional supply
chains view flow of goods from upstream raw material suppliers through manufacturing processes and on to the customers. In the apparel and textile supply chains, one might expect to start with raw materials such as cotton, polyester and wool, that are then woven into fabric, dying and passed into apparel manufacturers.
The apparel manufacturer will cut the cloth, make it up and trim to a specific design template finishing and delivering to a retail customer, who sells the item on until it reaches its final destination - the customer. The
traditional supply chain includes purchasing, supply, distribution (logistics), operation management and marketing. In contrast, the modern supply chain concept begins and ends with the customer.
The
contemporary chain is viewed from marketing perspective and as being demand driven by customers. Traditional perspectives focus upon operations, tactical initiatives and emphasize cost reduction as a major goal. Contemporary views of supply chain management view it as being strategic in nature with long term implications and advantages in terms of differentiation and not simply cost alone.
Modern supply chains are described also as value creation mechanisms for customers. They are not simply ''supply'' focused, nor are they necessarily ''chains''. Supply chains are dynamic, efficient, effective response networks delivering customer requirements flexibly and on time. These high performance networks consist of customers, suppliers and information traveling through organizational '' arterial systems''.