Management

How startups can achieve seamless supply chains in the global fashion industry

David Poole shares his top five tips for selling fashion cross-border, offering best practice advice and guidance on how small firms can make the most of international opportunities.

The influence of British fashion across the world is ever-growing, and its importance to the UK economy is not to be underestimated. Over the last twenty years the UK’s fashion industry has grown into one of the world’s leading retail sectors. However, big retailers are not the only ones reaping the rewards, with fashion startups increasingly discovering the growth potential overseas in the form of new customers, or unique finishes and componentry for garments. With support from organisations such as UK Trade and Investment (UKTI), the potential for new entrants in the sector to build sustainable growth quickly is clear: in 2014, British fashion was worth 26bn to the UK economy.

Yet, the complexities involved in the logistics of fashion? are often overlooked, particularly during periods of increased demand, such as Fashion Week season. So whether you’re in the business of sourcing textiles, manufacturing or exporting items of fashion globally, understanding the best ways to navigate complex customs rules and regulations can make or break a burgeoning brand.

Here are my top five tips to help you do so.

(1) Know your markets

There is no one-size-fits-all strategy when it comes to entering multiple countries overseas. Whether you’re looking to conquer an established market or an emerging one, you must consider the individual customs, regulations and code of etiquette for each country, including licensing requirements and quotas. Costa Rica, for example, controls trade in certain wool fabrics, whereas Mexico requires textile or material importers to hold a license or visa.

(2) Keep up-to-date on charges and other trade rules

During the transportation process, you may have to pay two sets of charges firstly at the point of export and secondly at the point of import into the destination country. Understanding the costs involved at each end will help you to plan ahead accordingly.

Do bear in mind that as a member of the Customs Union, the UK benefits from restriction-free trade with other EU countries. If you are exporting clothing to the EU that has been processed from imported EU raw materials or goods, you may be able to apply for additional relief from customs duties.

Think about where your goods are made and how much is of EU origin, as you may get duty relief from other preference-giving? countries outside of the EU that favour imports from this area.

(3) Overcome customs challenges with accurate labelling

Specific rules apply to the transportation of fabric and clothing. To ensure you give an accurate valuation, you must provide a detailed description of the contents of the shipment being exported. For example, rather than “bolt of wool”, the recommended description would be “bolt of plain red wool”.

This will help ease the goods through customs and allow officials to calculate the correct duties and taxes to be paid, without any holdups. Stating the gender for which the garment is designed is also important, as this will impact on the duty rate when being transported overseas. In some countries the country of manufacture needs to be disclosed, namely the US, where the manufacturer needs to be identified via a code or the manufacturer’s full name and address.

(4) Be aware of counterfeit products

Estimated figures show that approximately ten per cent of sales in the global fashion industry are imitation products, with accessories including belts, handbags and shoes being the most commonly counterfeited items. Today’s fakes can be difficult to detect even beyond heavily branded items. Pay careful attention or you could find yourself unwittingly sourcing or being sold counterfeit merchandise to complete a seasonal line-up.

(5) Give good customer service through realistic guarantees