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B��N�CL�D(�?�?�?z�z��Nd�?�?�?ՌHHHHXXX�&$XXX&XXXDDDDDD����Merchandisers� Performance and Supply Chain Competitiveness in Apparel Export Units

1. Archana Gandhi,  Associate Professor, National Institute of Fashion Technology (NIFT), New Delhi, India.  HYPERLINK "mailto:Email-archana356@gmail.com" Email-archana356@gmail.com
2. Sunil Sharma, Professor, Faculty of Management Studies, University of Delhi, Delhi, India. Email- ssharma@fms.edu

1. Introduction
Time, cost and agility management have been the major objectives of apparel supply chain management in the last two decades. To achieve these objectives, apparel exporters/suppliers strive to cut down on activities that contribute to value being created for the customer and identify value added at each stage of value chain.
Irrespective of the category, clothing products can take a complex route from fabric production, through garment production and distribution, ultimately to an individual retail customer (Johnson, 2002). 
A global supply network comprises of diverse entities including retailers, designers and merchandisers, fabric producers, garment manufacturing plants, as well as distribution, logistics and warehousing companies (Dickerson, 1999). 
Apart from the final customer, the three key entities of the apparel supply chain are:
The Apparel Importer/Buyer-The apparel export industry is a buyer driven industry, hence comprehending the expectations of the buyers is of utmost importance. The buyer could be a retailer, a brand owner or a wholesaler based in he country of selling.
The Buying House- The buying house is a mediator between the buyer and the seller and helps to liaise all activities in the country of manufacture for it�s principals. The buying house plays a vital role in offering the kind of service levels which their principal(s) expect and ensuring that they upgrade the vendors.
The Apparel Manufacturer/Exporter-Also referred to as vendor/seller/exporter, the apparel manufacturer/exporter is the most important link in the supply chain. The manufacturer produces the merchandise demanded/ordered by the buyers in the specification, quality, price and time decided by the buyer. 
A clear line of communication amongst all members of the value chain is of prime importance. All efforts must be participative and must involve linking amongst all chain members.
Key issues that need to be understood here include the different participants within the network; the nature of their relationships; ownership, power and control structures; how the network is managed, coordinated and controlled and how information flows in the network (MacCarthy and Jayrathnae, 2009).

3. Indian Apparel Export Competitiveness
Each firm's performance and survival is dictated by a combination of external and internal factors (Anand, 2003). But a firm cannot compete externally if its internal operations are not geared to deliver. The firm level initiatives suggested to improve competitiveness are: 
Core competencies: Each firm needs to identify its core strengths benefits and build on them to create its own niche in the marketplace through an extensive benchmarking and hence draw up a business plan to reach its goal.
Market responsiveness: Given their small operational scale, most Indian textile firms are unable to respond to market challenges. Market responsiveness is a combination of various factors such as communication, transparency, delivery timeliness, social and employment and environmental aspects. All these have a bearing on the sourcing decisions of international buyers.
Organisational restructuring: Most garment units are family run businesses. The infusion of professional management at senior level would enable them to access experienced and talented pool of manpower. Investments in IT and communications could help reduce response time

To improve supply chain efficiency, Indian suppliers must develop collaborative links with buyers working together as partners during the buying-supplying process (Singh, 2008). 
Study on buyers� perception of India as an apparel sourcing country has shown that while India was perceived satisfactorily on price, quality, technology, flexibility, small order quantity etc., it was perceived unfavourably on lead times, responsiveness, communication, trust, meeting contractual obligations, ethical standards etc. (Verma, 2002).

4. Merchandising in Apparel Industry
Merchandising is defined as activities undertaken to ensure that the right product reaches at the right price in right quantity and at the right time to the final destination. (Gowrek, 2004). In the apparel industry, merchandiser is the bridge between the management (or) industry and the buyer.  Merchandiser is the person responsible to make the product according to the buyer�s parameters and satisfaction. Merchandisers coordinate various functions like buying the raw material (which is required to finish the product), making the apparel, finishing the apparel, documentation (over all view), finally shipping. 

A fashion merchandiser needs to be (Gowrek, 2004)
Versatile and flexible as the buying schedule may include many tasks. 
Enthusiastic, self motivated, creative, imaginative
Conscientious, professional, decisive and numerate.
Foresighted  and people� s person

Responsibilities of the Merchandiser
Muhammad and Brookshire�s (2011) study results revealed daily duties of merchandiser as:
Vendor management-Vendor relationship building and maintenance are considered one of the most important firm activities because vendors or suppliers are a critical element of a firm�s profitability
Product development -The knowledge of product development and its role in global sourcing seemed to be important for merchandisers. The responsibility could be as small as acquiring materials for product development, extending to dynamic work relationships with product developers. Merchandisers must understand the product development process and international sourcing.Also a time and action calendar, to communicate the significance of timely follow-ups in sourcing is a pre requisite.
Production management- The study data showed that merchandisers are responsible for managing entire production or manufacturing processes . In overseeing production, merchandisers are responsible for three major production factors � cost, on-time delivery and quality. To achieve the objectives of cost, delivery, and quality, merchandisers are responsible for resolving production issues and problems with vendors. They must know different objectives of costing and quality assurance. Other responsibilities, such as scheduling, vendor performance tracking, and quality evaluation may help achieve cost, delivery, and quality objectives.
Internal collaboration- Collaboration helps to foster internal relationships between colleagues with whom individuals can consult about work related matters that internal interactions among different constituencies to negotiate and resolve various conflicts may occur during planning, managing, and executing processes. Apparel firm employers sought merchandisers to coordinate meetings, interface between departments, and play a liaison role within all levels of the firm. Merchandisers work closely with the quality assurance, importing, logistics and legal departments, suggesting a wide range of responsibilities directly related to various departments. 
In a paper by National Skill Development Corporation on Human Resource and Skill Requirements in the Textile Industry, India (2010), the skills required in a merchandiser are:
Understanding of various production activities as the merchandiser is interface between the buyer and the company
Soft skills like negotiation and communication skills. These skills assume more significance for export oriented units.
Ability to handle multiple accounts/customers.
 Thorough understanding of costing.
Understanding of buyer requirements of design and quality.
Reviewing materials used for garment manufacturing
Understanding of various production activities 
Ability to work closely with other functions like design, production etc.
 Time management skills to handle multiple orders at the same time.

Jobs of a Merchandiser in an apparel manufacturing company can be seen in  table I.

Table I

5. Apparel Supply Chain Competitiveness & Performance
Competitiveness is defined as relating to, characterized by, or based on  HYPERLINK "http://www.merriam-webster.com/dictionary/competition" competition (Merriam- Webster, 2010).

Firm competitiveness is the basic capability of perceiving changes in both the external and internal environment and the capability of adapting to these changes in a way that the profit flow generated guarantees the long term operation of the firm (Gelei,2004).
A company�s competitive strategy defines, relative to its competitors, the set of customer�s needs that it seeks to satisfy through its products and services. (Chopra & Meindl, 2008).The competitive strategy is based on its customer�s priorities.
The term market competitiveness can be defined as: Having a position of superiority over competitors in satisfying the aggregate demand for certain products or services (Nowell, 2004). In the textile and apparel industries, being competitive in the market means that companies must also be competitive economically. Economic competitiveness in the textile and apparel industries means that one must sustain and grow a business within the global environment, through optimization of products, processes, and strategies to gain a competitive advantage.
Supply-chain competitiveness is a holistic matter that requires each partner within the supply chain to align their structural elements. Some important  elements of supply chain competitiveness as established by various researchers are cost, logistics, flexible supply chain, quality, delivery, product availability, innovative products, value added product and customer supplier relationship (Nowell 2005, Cooper et al. 1997).

Though there has been much research in terms of performance measures for supply chains, textile and apparel specific research in the area is lacking (Allen, 2008).Most important metrics to gauge the performance of textile and apparel supply chains  are-cost,  on-time delivery, quality, lead time and capacity.

In a research on �Improving the Competitiveness of the Haitian Apparel Supply Chain� (Uluskan 2010), service level was an important parameter to improve competitiveness. Service refers to response rates and communication levels in case of a problem, suggestions for the solution to that problem, the sample preparation and delivery time, being proactive in helping buyer companies to run their business, watching the marketplace for the type of products that they produce and bringing new ideas to buyer companies. 

6. Conceptual Model Linking Merchandisers� Functions to Supply Chain Competitiveness
 EMBED PowerPoint.Slide.8  


7. Need for Research 
Considering the important role that apparel manufacturing companies play in the buyer driven apparel supply chain, the role of a merchandiser in such companies is of prime importance. The literature available on �merchandiser� most often focuses on the retail companies� merchandiser. Research on the role of merchandiser in apparel export manufacturing companies was found lacking.
Merchandisers play a pivotal role in ensuring right product reaches the consumer at the right price, quality and time. Price, quality and timeliness are also important factors of supply chain competitiveness in the apparel industry and hence it obviously emerges that merchandisers� performance is likely to have an impact of supply chain competitiveness.

8. Objectives of Research
This study was descriptive-cum-diagnostic research work. The aim of the study was:

To identify the most instrumental factors, for assessing merchandisers� performance.
To analyse the relationship between merchandiser performance factors and supply chain competitiveness factors for apparel export units.

9. Research Methodology
Out of an initial population frame of 2300 apparel export companies located in National Capital Region of Delhi, 128 companies were selected on random basis out of which 92 were selected on judgement cum convenience basis. Consequent upon the response rate, 80 companies agreed to participate in the research study on merchandiser performance and supply chain competitiveness of apparel export units. The response rate was 87%.

The following criteria was adopted in selecting sample companies
The company should have a manufacturing/processing/assembly unit or head office/sourcing office in NCR of Delhi.
The sample company must have annual turnover of at least Rs 20 crore.
The companies could be apparel export manufacturing units, buying agencies and international apparel buyers.
The merchandising department of participants should have minimum staff strength of 5 merchandisers.

The research covered 80 companies. Of these 80 companies 50 were manufacturers for exports and 30 were apparel buying agencies/liaison offices. Fifty eight percent of the sample represented private limited companies where as proprietary firms accounted for twenty five percent of the total sample, followed by eight percent of public limited companies balance being joint ventures.
Pre testing of Questionnaire: A tentative questionnaire comprising of about 40 questions was developed for pre testing purpose. The questionnaire was then administered to 10 conveniently selected samples of apparel export companies and personal interviews were conducted. 

c) Content Items of the Questionnaire:  As a result of pre testing and feedback from respondents and experts of the apparel industry, questions were edited, re-designed, consolidated, simplified. The final questionnaire consisted of 45 questions which covered aspects of merchandiser job responsibilities and apparel supply chain competitiveness factors as relevant to the apparel industry

d) Response Mechanism: 
70% of interviews were in-depth personal interviews, 20% were structured telephonic personal interviews and balance 10% responses were received on email. 
Those answering the questionnaire were top management of the apparel export company-the owner/CEO, General Manager or Merchandising manager of the apparel export unit/company selected

e) Reliability of Variables Measured-To measure the extent  to which a procedure yields consistent results on repeated administrations of the scale, the reliability analysis was performed using SPSS 16.0.The cronbach alpha value was .911

10. Data Analysis 

The data analysis was conducted in 2 steps:
Hypothesis Testing.
Correlation Analysis.
 
9.1 Hypothesis Testing
The factors that could help enhance merchandiser performance were enlisted at the beginning of the study, as derived from literature survey.
Twenty one hypotheses were formulated and t-test was then chosen to determine the statistical significance between sample distribution mean and a parameter and the key inferences at 95% confidence level were drawn.
The hypothesis testing in Table II showed that the mentioned variables have an effect on merchandisers� performance (null hypothesis was rejected):

Table II

The two variables where null hypothesis was not rejected are mentioned in Table III.

Table III

9.2 Correlation Analysis
Correlation Analysis was carried to find out the correlation between variables of merchandiser performance and supply chain competitiveness. Correlations measure how variables or rank orders are related.

Table IV



The variables that have �strong� and �positive correlation� between them are:
i) Knowledge of apparel manufacturing has strong correlation with-Sampling Lead time, Production Lead time and Product Quality 
ii)  Knowledge of dynamic product costing has strong correlation with- Retail Pricing and Product Quality
iii) Organisation and Communication skills are strongly correlated to-Attitude and Work Culture and Responsive to buyers.
iv) Knowledge of Quality Assurance (QA) has strong correlation with Delivery.

10. Conclusions
1) Key Merchandiser Performance Parameters are
Customer centric sense of design and aesthetics 
Thorough raw material and product knowledge 
Fabric and trim sourcing capability 
Share appropriate and timely information with all departments and buyers 
Help plan and schedule production capacity & resources 
Knowledge of Quality Assurance (QA) in apparel manufacturing 
Knowledge of dynamic product costing Organisation and communication skills 
Understand needs of end customer 
Capability of collaborative forecasting 
Actively involved in product and market research 
Global sourcing and supplier management 
Knowledge  of apparel manufacturing 
Co-ordination skills of distribution and logistics 
Pre-emptive capability to solve production and logistics problems 
2) Correlation analysis showed the parameters of  merchandiser performance that have an impact on supply chain competitiveness 
1. �Knowledge of quality assurance in apparel manufacturing� and �Delivery� suggesting that merchandiser�s knowledge of apparel manufacturing and quality assurance helps them manage the delivery schedules in a better manner.
	
2. �Knowledge of dynamic product costing� and �Retail suggesting that retail pricing calculation exercise is better managed by those merchandisers who have the knowledge of costing dynamics.

3. �Organisation and communication skills� with �Attitude and Work indicating those merchandisers who have developed themselves on organisation and communication skills have better attitude and contribute in improving work culture of the organisation.

4. �Organisation and communication skills� with �Responsiveness to indicating that merchandisers with better organisation and communication skills can be more responsive to needs of buyers.

5. �Knowledge of apparel manufacturing� and �Sampling Lead Time� implying the fact that sampling time can be optimized by merchandisers who have better technical knowledge (that of apparel manufacturing).

6. �Knowledge of apparel manufacturing� and �Production Lead Time� implying that merchandisers who have knowledge about apparel manufacturing are better equipped to manage production lead times.

7. �Knowledge of apparel manufacturing� and �Product Quality� suggesting that product quality is managed better by merchandisers who have knowledge about apparel manufacturing.

8. �Knowledge of dynamic product costing� and �Product Quality� suggesting that the merchandisers who have command of product costing skills can manage product quality (and design) better.
    
11. Recommendations

Systems within the organisation-
Dedicated training cell- A dedicated training cell which assesses the training needs and organizes training of merchandisers on a routine basis. 
Training of Trainers- Apart from getting external expertise in training, the trainers in many cases could be senior people from within the company. Refresher training for trainers is also required.
Role of Information and Communication Technology (ICT)- Resource planning systems like ERP systems for in-house coordination with real time EDI (Electronic Data Interchange) systems to communicate with buyers and suppliers could help merchandisers organize their work better, communicate, share and coordinate faster with all functions concerned
Robust infrastructure and quality management systems- The merchandiser in any organisation has to co ordinate with various functions/departments and ensures that the processes therein are executed in a timely and orderly manner. Strengthening the functioning of each department particularly the production and quality assurance departments could strengthen the execution skills of the merchandiser.

    ii. Merchandisers� Initiatives
Right from the time new products are sampled, the merchandisers need to acquaint themselves with the behaviour and feel of the raw material and the apparel products. The initiative of the merchandisers in this area could help prevent buyers from selecting a difficult to produce product, help the apparel export unit do appropriate costing on tough product and help production department of the company handle the new product in appropriate manner.
b)Apart from learning execution of merchandising job responsibilities, merchandisers need to understand the larger and aggregate picture as regards supply chain, positioning of their organisation is in the supply chain and ways in which their role can enhance the competitiveness of their organisation.



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