Delivery Extension in Apparel Supply Chain-How to Convert the Sin into a Win?

Any Apparel Professional On The Supply And Manufacturing Side Of The Apparel Industry Has Heard The Dreaded Words- 'Let The Vendor Air The Goods'.

The Usual Supplier Reactions Are-

'But The Buyer Did Not Give Comments On Time, How Can They Ask Us To Air The Goods?'

'There Is No Way We Can Air The Goods. There Is Hardly Any Margin On The Order. In Fact Already The FOB Is Based On Bare Duty Drawback Advantage.'

'They Made So Many Spec Changes Which Pushed The Schedule Haywire. Buyer Must Take Responsibility For Their Part Of The Job.'

'The Lab Dips Submitted Were In Acceptable Range, We Even Submitted Spectrophotometer Delta Readings. They Kept Asking For Resubmits, Which Ate Up All The Lead Time Available. How Can We Be Made To Air The Goods, If They Could Not Decide The Color They Wanted To Buy?'

So On And So Forth, Depending On The Various Situations One Encounters In The Apparel World.

The Typical Buyer Responses Are-

'We Cannot Afford Even A Day's Slide. This Is Our Best Selling Style.'

'We Need To Get The Right Product To Market. Spec Changes Were Necessary Since The Vendor Was Not Able To Get The Fit Right In The First Place.'

'Vendor Should Be Able To Match The Color Standard Within The Time Frame They Require To Keep Schedules On Track. We Are Being Generous By Even Accepting The Goods With Off Standard Color, Instead Of Simply Cancelling The Order And Claiming For Loss Of Sales.'

'They Took Ages To Turn Around The First Fits. Due Diligence Should Have Been Done From The Beginning To Prevent Any Delays.'

We Often Get Stuck In This Tricky And Conflicting Situation. The Vendor Feels That Buyer Is Partly Responsible For Causing The Delay And Buyer Feels That Vendor Owes It To Them To Ship The Goods On Time, No Matter What And Should Proactively Manage The Deadlines. What Is The Best Way To Handle Such Situation Is The Focus Of This Paper.

Decidedly, Each Situation Is Unique And Will Call For A Unique Resolution. But For The Purpose Of This Discussion, Let Us Assume The Common Theme That Vendor Is Not Internally Convinced About Being Held Responsible For The Delay In Question. Some Part May Have Been Played By The Buyer In Contributing To The Delay As Well. So What Do You Do To Put Across Your Point, Without Appearing To Be Playing The Blame Game?

Some Things To Consider Thoroughly Before Embarking On The Negotiation-

A). What's Your Track Record? If You Have A Reputation For Shipping On Time, You May Have A Stronger Case. If Out Of The 15 Pos Shipping This Month, 14 Are On Track And Only One PO Is Affected, Again You Have A Strong Case. Conversely, If The Situation Is Such That Many Pos Are Facing Delivery Delay Threat And This Happened Last Season As Well, Then You As A Supplier Do Not Have Much Of A Platform To Bargain.

B). Sample Turnaround Timelines. It Often Happens That The Momentum And Speed With Which Samples Are Turned Around Reaches Its Crescendo Towards The End Of The Approaching PCD. In The Beginning Of The Purchase Order Cycle, The Tendency Is To Be A Bit Slow And Slack In The Time Taken To Turn Around The Samples. This Is A Typical Student's Syndrome Which Is Prevalent In The Industry. (Remember The Last Minute Frantic Mugging Before The Exams As A Student, While Taking It Easy Throughout). This Is More Often Than Not Picked Up As A Basis By Buyers To Put The Ball Back In The Vendors Court. So Watch Out For This One While Presenting Your Facts.

C) What Are Your Options? Do You Have Any Alternative Options Or Suggestions To Still Get Back On Track And Avoid Delay? For Example, You May Want To Take An Exception To Submit The Fit As A PP Or Request For An Exception To Use Substitute Trims For The Purpose Of Getting Past An Approval Cycle, Or You May Offer To Do Split Shipment Etc. These Would Then Be Used As Gambits While Negotiating Delivery Extension.

D). How Far Are You Willing To Go? Sometimes, The Pricing Is So Tight That You Simply Cannot Afford Even A 5 % Discount, Leave Alone An Air Freight Situation. There Might Be Other Situation, When There Is Enough Buffers Built In The Fob To Concede A Bit By Way Of Discounts. A Clear Understanding Of How Far Are You Willing To Concede In A Situation Is A Must Before Getting Into A Negotiating Situation. This Will Prepare You To Present Your Case Appropriately. Though Any Smart Negotiator Knows Not To Lay His Cards Out Too Quickly, And Keep Them For Last Stages Of Closing Any Negotiation.

E). What's On Stake For Your Buyer? If Your Style Concerned Happens To Be A Best Seller For Buyer, You Hardly Have Any Chances Of Getting Any Extensions. Similarly If It Is Part Of A Special Selling Line Or Occasion, For Example 4th July Collection Or Christmas Collection, With Limited Shelf Space And Huge Potential Of Loss Of Sales, In The Event Of Delivery Slide, There Is No Way That You Will Get An Extension. On The Other Hand, If The Style In Question Is Part Of A Core Selling Which Ships On A Regular Basis, You Might Be Able To Negotiate An Extension. This Knowledge Of Whats In It For Your Buyer Is Crucial For Effective Negotiation.

Being Armed With This Knowledge, Keeping A Cool Mind And Thinking From A Buyer's Perspective, You Should Be Able To Do A Very Good Job Of Negotiating. When I Was In College I Used To Participate In Lots Of Debates, And To Prepare Myself For Or Against A Topic, I Would Focus On What My Opponent Is Going To Speak, Rather Than What I Would Speak. This Counter Focus Would Help Me To Prepare A Fool Proof Case For Or Against The Topic I Was To Represent. I Strongly Recommend The Same Strategy For The Vendor. Think Of What Your Buyer Is Likely To Counter You With And Prepare Your Case In Advance To Cater To Them.

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