Tech laggards: Fashion retailers fail to capitalise on digital boom

Many fashion retailers didn’t have the technology foundation in place to capitalise on the coronavirus powered e-commerce boom over the past year, according to research from Hitachi Solutions and K3 Technologies.

The pair surveyed 300 directors of e-commerce, finance and buying and merchandising from apparel and footwear brands with a turnover of over €100 million.

57% reported that they weren’t agile enough. However, those that made early investments in digital ERP reported fewer issues around agility and were quicker to deploy efficient digital sales strategies. This is because they had access to better data insights.

Other key findings include: the number one cause of internal bottlenecks, and therefore one of the biggest barriers to meeting customer demands, is lack of visibility (86%).

One in five fashion brands have yet to digitalise their ERP, with France being the slowest adopters in Europe.

And the biggest challenge is making the business case for updating (28%), before and during Covid-19.

Tony Bryant, Director Global Business Development and K3 Technologies, says: “2020 provided a reset moment for retail and fashion, with many brands completely pivoting to meet customers through digital channels.”

“But customers' demands are becoming more complex, and the fashion brand landscape is in adapt or die mode. For many fashion retailers, a lack of visibility into operations and inventory has been a spanner in the works for meeting customer demands.”

He concludes: “This is why laying the foundations for a single source of real-time data through ERP is critical. It delivers competitive advantage for fashion brands in a world that increasingly values convenience, personalisation, and flexibility.”

“Fashion brands need to meet customers where they are, and a strong digital foundation plays a critical role here.”