The Study On Supply Chain Management In Lady’s Fashion Manufacturing And Retailing Company

Fashion changes every day and every second, so there are enormously styles offashionable dress which has very short product life cycle and highly uncertainty ofdemand. The productivity of fashion product is too low to couple with the significantchange of demand.A traditional model is that the manufacturer or the fashion company shouldproduce enough products and store them before put into market according the demandforecast. The estimated quantity of production isn’t accurate, so there is a risk.Sometimes they are so small compared with the actual demand, sometimes thesurplus products will fill up the store. The result is loss of profit for shortage ofproduct or too many products in storage waiting for selling and devalued. In order todeal with the problem, the only way we could do is change the strategies of supplychain from “push” to “pull”, which could be achieved through accurate forecast ofdemand and agile production. Here we only study the forecast of demand.The demand of fashion product consists of many waves; each wave consists ofseveral dozen of style for the reason of short product life cycle. If we find the demandof each style, we will know the total demand. The thesis provides a new method ofdemand forecast based on the structure of demand. The demand is a discrete randomvariable conforming to binomial distribution, which was determined by the quantityof potential customer and its probability of buying. The forecast of demand could beused to calculate the optimized order quantity, monitor process of sales, find the errorof forecast in advance and correct it in order to avoid out of stock or dead stock.