By Sharon Donovich
For decades, major brands have offshored their manufacturing operations to low-cost, less-regulated developing nations to keep operational expenses low and support healthy profit margins. Air and sea freight could transport goods to all corners of the globe, a “reasonable” amount of waste was tolerated, and demand was predictable.
But this mode of thinking is woefully outdated.
Human ingenuity has wrought a digital marketplace that completely reconceptualizes the supply-and-demand paradigm, standards of living in traditionally third-world manufacturing epicenters have risen, and the call for using innovation to meet global imperatives for ecological sustainability, human rights, and safe, responsible practices is growing.
While the upside of technological development presents its own challenges for manufacturers, the more troubling aspects of financial, logistical, and sociopolitical dynamics between economies are still as problematic for producers as ever.
Consumers may understand these challenges in the abstract, but it is a web-driven economy that has conditioned them to expect instant gratification, unlimited variety, customization, quality, responsible and transparent business practices, and other transactional attributes that only a short time ago were reserved for the wealthy. They expect products that reflect their personalities and values. The internet offers infinite possibilities, and traditional fulfillment models don’t offer a corresponding flexibility to bring those possibilities to one’s doorstep.
While risk mitigation and shrinking time to market may be obvious benefits of bringing operations closer to home, it still leaves other critical concerns — most notably, the question of labor costs, which alongside energy and other core OPEX remain high “at home.” Furthermore, the mechanics of a reshoring project in its own right — hiring and developing new labor forces, resetting supply chains in service of domestic production, building or leasing production facilities, and so on — are considerable.
While a digitized marketplace applies pressure on manufacturers to merge supply chains and fulfillment models, it is digitization itself that promises to make reshoring a simpler, even more profitable proposition for those businesses. It also has the potential to meet the industry’s increasingly stringent mandates and benchmarks for sustainability.
Let’s consider textiles and apparel decoration — and our proposition for scratching the “why offshoring made sense” itch in a way that meets the promise of a web-driven, instant-gratification marketplace while helping both consumer and producer (and designer). With on-demand digital (i.e., inkjet printing) textile decoration, producers can print imagery on a host of fabrics, both natural and synthetic, much the same way we’ve been putting ink to paper for decades. The image is durable, keeping its graphic and hand-feel qualities with exposure to washing, touch, and sunlight. You can replicate nearly any image, including photography, without limitations of color or detail. Printing takes place on any number of pieces — from long-runs/high volume production — down to a single garment, at a low and consistent operating cost. The process is also ideally suited to align with an industry desperately striving for sustainability. That makes it better not just for producers, but for the planet by using significantly less water and energy.
These direct-to-garment or direct-to-fabric print systems require only a single operator, generating a ready-to-ship imprinted piece or material within minutes; the quality meets requirements of some of the world’s most recognized apparel brands, even among the haute couture set. The inks and consumables adhere to the world’s strictest standards for environmental sustainability, and safety for decorating children and baby apparel. The machines use a small fraction of the water and energy associated with traditional methods like screen printing, and it’s easy and fast to train workers to run and maintain them, particularly for a generation that came of age using mobile apps. There’s also no need for specialized skills or deep knowledge of textiles.
Best of all, this technology empowers on-demand production. Because it is pushbutton-quick, producers can sell the product first, and then produce and ship within days or even hours. This cuts inventory risk and generates considerable profit per employee — an ideal formula for scaling businesses upwards. Because the mechanism is digital, management gains transparency (read: accountability) to the complete fulfillment process, from order to shipment. They gain visibility and control across multiple production floors, even different regions. Production systems integrate directly with e-commerce sites, online design applications, and even social media channels, empowering producers to find and capitalize on sudden opportunities and immediate trends by productizing those events and sentiments. On-demand digital printing also significantly streamlines supply chain management — making production faster and less complex.
With sustainable, on-demand digital production, traditional offshore production epicenters cease to be factories vulnerable to floods, tariffs, skirmishes, fires, or stranded inventory; they become new markets for selling products. That’s why we see great promise in the growing global network of digital fulfillers, ready to produce the pieces ordered — in any quantity, to any specification — locally, minimizing the risk, time, and logistics involved in getting such products delivered. Forward-thinking producers are adopting digital decoration capabilities in all corners of the globe, fulfilling demand wherever it’s found — a win for consumers who want options, a win for producers who want profits, and a win for designers who want to sell their creations and grow their brands. It’s even a win for retailers who no longer need to stock physical shelves to sell branded apparel; customers can fulfill e-commerce needs via this interconnected fulfillment network, yielding satisfied buyers who receive their top-quality pieces, made locally, as quickly as they demand them.
On-demand fulfillment models meet the benefits of offshoring without the associated risks, for both major global corporations and family-based entrepreneurs, many of whom cite “bringing jobs back home” as a key reason for their endeavor. For many, a digitized world presents a challenge to be solved.
For those building fulfillment strategies around onshore and localized on-demand production, a digitized world means tapping new markets and growing in years to come. Achieving the benefits that offshoring operations once promised … right here at home.
Editor’s Note: Sharon Donovich is a director at Kornit Digital
August 15, 2024
