The most important aspect of today’s evolutionary shift from the mass manufacturing of the “Industrial Age” to the advent of the “Digital Age” is the promise of Demand Manufacturing and Sourcing which captures sustainable high profits through a digital “Virtual Inventory” (VI). This opportunity to tie production directly to sales minimizes wasteful over production and the resulting environmental impact while providing a quantum jump in product choice and wholesale and retail profits.
Demand Manufacturing is divided into two production paths that are defined by the customer. Individual pre-paid consumer custom products are produced using Purchase Activated Manufacturing (PAM) and wholesale production that replaces actual retail product sales in store or on line is called Demand Sourcing (DS).
An Integrated Mini-Factory (IMF) is capable of both manufacturing paths. Demand Sourcing allows the online or brick and mortar retailer to operate in the dream state of "never out of stock and never over stock"
Now that the technology is tested and available it's time to define the terms used to describe the elements of Demand Manufacturing:
Active Tunnel Infusion (ATI)A permanent coloring process developed and patented by AM4U, Inc. that uses clean physics with no water instead of chemistry to dye and/or print fabric.
Color SpaceDisplay monitor screens are portrayed in pixel based Red Blue Green (RGB) color space. Digital printing appears as dot arrays of Cyan, Magenta, Yellow and Black (CMYK) color space.
Color ConeA graphic representation of all the factors required to be in alignment to reproduce matching colors job to job and/or between digital printers.
Color ProfileAn ICC profile is a RIP translation table that provides RGB, CMYK or Lab color values directions to the nearest CMYK printable value for each color. Profiles are not used for color correction on a file-by-file basis.
ConfiguratorSoftware used online to modify an image or product. Usually used to change the color and/or embellishment on an item pictured in a catalog or customizing display.
Cost of Goods Sold (COGS)The cost of product is calculated as the total cost of wholesale products actually sold and shipped or retail products actually purchased at full or promotional price. “Cost of goods sold” replaces “cost of goods”
Cost of Units Sold (COUS)In demand manufacturing units are not produced until after they have been sold. Since there is no pre-financed physical inventory the cumulative cost per unit is calculated as product is produced. “Cost of units sold” replaces “cost per unit”
Custom Stock Unit (CSU)This inventory designation represents a personalized product appropriate for sale to a specific individual or individuals. In unit manufacturing there are very few situations where a CSU exists without the actual sale already in place. Forecast based CSU’s that remain unsold represent the largest risk of inventory liability.
Days of Supply (DOS)The speed of product throughput and shipping determines how many days of supply the production line needs to manufacture to successfully manage the consumer available inventory so that at least one of every offered SKU is available during the selling cycle. DOS replaces “inventory levels”
Demand Sourcing (DS)Buyer’s restocking order caused by retail sales rate and DOS
Digital CoreThe digital core of a product is the descriptive binary data that never changes whatever process; assembly or logistics instructions are attached as variable instructions to the digital core. This is part of the Tech Pack for apparel.
Digital SKUOnce products have completed the design and development process they are registered with a design number and stored in a digital folder of SKU marker sizes. Once a production style is in the digital inventory it is ready to be assign a search path and added to the Virtual Inventory (VI) for production on demand.
Digital Support Instruction (DSI)The DSI for a product is all the supporting materials inventory information required to produce one or many of that particular SKU. In order for the DSI to be to quickly available to the active scheduling roster, the integrated GSU status and ERP (see below) must be current.
Digital TwinThe “Digital Twin” is a sophisticated virtualization model developed by Black Swan Textiles to compare and facilitate existing systems. A factory utilizing the Digital Twin methodology has modeled all manufacturing equipment, operators, and processes, enabling it to simulate the operations necessary to assemble any particular product.
Direct to Garment (DTG) & Direct to Fabric (DTF)Printing machines that print directly on finished garments (DTG) or directly on fabric roll goods (DTF).
“Endless Aisle” RetailingA retail display using a touch screen, body scanner and video mirror to offer endless VI choices to a consumer. Displays can include a try-on product that can be visually customized and produced for delivery through store pickup or home.
Generic Stock Unit (GSU)This inventory designation is normally used for items that can be assembled into a number of different products. Although GSU's are usually roll goods or parts in their basic form (greige or PFP fabric) the designation is also used for items, which are partially assembled but still may be used for many products.
“Grays”The sewn and finished blanks used to confirm the fabric, fit, production speed and process steps for a specific silhouette. Grays are often part of an “endless aisle” display or are used as a merchandising tool to reduce returns in swimwear
Integrated Mini Factory (IMF)One of the key features of an Integrated Mini Factory is that all of the coloring, printing, cutting, sewing and fulfillment are under one roof. This allows for the ultimate in “lean” manufacturing because the minimum can be one custom unit or a multi unit retail replenishment order that matches consumer sales.
Job TrackerAn optical reader and / or a RFID signal track each job and piece through the production path.
Landed/Duty/Paid Cost (LDP)Actual cost of imported products including: materials, labor, transportation, duties, forwarding, warehousing and internal distribution.
LinearizationLinearization is an iterative process used to control dot placement for each color for a particular device, ink and substrate using software and press settings. This process balances the primary colors and dot placement. It is performed before ICC color profiling.
Micro MerchandisingUsing social media and other online aggregation tools to identify and target specific silhouettes, colors, fabric and decorations at special interest individuals and groups.
Point of Asset (POA)Point in the production path when a GSU is transformed into an irreversible SKU awaiting sale. Items passing this point are a liability until finished and shipped even if they are pre-purchased.
Purchase Activated Manufacturing (PAM)A pre-paid purchase order, usually individualized, that triggers a production event.
Process IntegrationBuilding the bridges between separate technologies to produce a demand-based seamless path between product design, sales and marketing, coloration, cutting, assembly, finishing and fulfillment. Connecting these developed products requires technology, technique and field experience.
Product CycleOnce a style folder is registered, the product cycle can begin, usually with sales samples followed by initial stocking orders. Replenishment orders follow based on actual consumer “take away” until the product can no longer sustain the merchandise turns to maintain its place in the retail store inventory. Depending on the terms of the replenishment contract the style may remain in a digital catalog for individual ordering.
Product Performance Index (PPI)The predetermined index of product velocity (turns) times gross profit that a current product must meet to remain active (e-tail) or on the shelf (retail). If a product does not meet this index its “digital instruction” in the Virtual Inventory is retired but still available on order. Maintaining a continuous table of PPI tracking by SKU is the key to increasing sell-through and maximizing profits.
Raster Image Processor (RIP)The RIP is the Raster Image Processor software that translates the pixel based RGB color on the display screen to printable CMYK color and resolution for actual production.
Replenishment ContractThe basic document that describes the criteria for production of a particular style is the replenishment contract. This document sets the DOS standards for order content and logistics timing as well as finishing, packaging and order fulfillment.
Style CycleDesign and development of a Style Group (see below) involves the traditional process of pattern making and new process of fabric building. Pattern making is the traditional process of determining the shape and look of the garment and then the grading and reduction of the garment to a digital cutting marker for production. Fabric building is the selection of the white fabric style (silhouette) and the printing of decorations and colors to determine the print choices, which will comprise the style group.
Style GroupA Style Group is a single or group of garment silhouettes that occur in preset graded sizes on the same white fabric. The customer can choose from preset or custom print or color. Since process color cost is constant, one of the key merchandising advantages of digital production is the ability to change colors and prints on the fly without additional cost in a single style group. This allows the brand sales force to offer exclusive prints to each retail buyer.
Style ContractA Style Contract set a total purchase volume then allows a buyer to change the decoration and color of a SKU within the Style Group on short notice without penalty. This flexibility allows merchandisers to correct for a slow or non-selling SKU.
Stock Keeping Unit (SKU)This inventory designation is the first product cost point on the consumer side of the POA (see above). Products at the SKU stage can represent assets if they still can be customized to add significant value, but they generally represent the first level of inventory liability.
Selling CycleThe period of time a retail product is on the shelf before it is retired because it cannot maintain the predetermined PPI.
SMART BookThe Style Marker ART (SMART) book is a manufacturing quality control tool that contains all the customer approved process samples needed to check the production quality at each station in the manufacturing value chain.
Tracking ID (TID)The TID is an order number assigned by the ERP or PLM schedule software that appears on each piece of a garment and is removed when sewn. The TID creates a continuous reference to the VI data (see below) and the product tracking dashboard.
Virtual Inventory (VI)The VI is the searchable digital warehouse of SKU's and configurator resources.
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