fashionLogistics DHL sharpens its focus


THE CURRENT size and future potential of the worldwide fashion logistics market is highlighted by the fact that global integrators DHL and TNT are both targeting that sector – particularly flows from, to and within the Asia Pacific region – as major air freight/air express business growth areas. The background to that focus is explained by Ole


Ringheim, senior vice president and global head, fashion logistics, for DHL Global Forwarding. “We estimate the total global market for fashion and apparel traffic, in air freight terms, to be about two million tonnes a year, about 12 percent of the global air freight market.” DHL’s response has been to significantly sharpen its


focus on that business over the last year. “Fashion and apparel has been established as one of our core market sectors going forward,” Ringheim said. On the ground, DHL has since early last year invested


in six fashion and apparel “centres of excellence” across the Asia Pacific region, including one in Hong Kong. A further similar centre in Shanghai is expected to come on line by the fourth quarter of this year “to capitalise on the opportunities in the fashion and apparel logistics industry in China, estimated to be worth US$7.5 billion per annum”. Those centres (the other locations are India,


Bangladesh, Pakistan, Sri Lanka and Vietnam), explained DHL, are responsible for developing “tailored solutions and providing consultancy services to help customers better manage the product flow further upstream in their supply chain”.


TNT Express has also


established ‘lifestyle’, covering fashion, perfumes/cosmetics and sports products, as one of its key vertical market sectors. “We did that because we could see some big opportunities within that market, in terms of flows and movements, on a


global scale,” explained Peter Wielockx, the company’s global industry director, lifestyle. “Initially we were focused mainly on intra-European


traffic but more recently we have been building up Europe - Asia movements of high-end products by air using our own air freighter capacity,” he stated. “On the back of that, we are now looking to build up our involvement in the movement of mid and lower-end fashion goods being manufactured in China and other Asia Pacific countries and exported to Europe.” At the time of writing, TNT’s Asia - Europe freighter


capacity comprised six B747-400ERF flights a week from Shanghai and five a week from Hong Kong, all into the company’s main European air hub in Liège, but further increases in its China service frequencies are planned for the near future.


28 AIR LOGISTICSCHINA


several trends in retail sales development will probably prove beneficial for that mode of transport.


‘FAST FASHION’ One such trend, they suggest, is the continuing spread of the ‘fast fashion’ concept which involves retailers frequently changing their lines of stock to boost sales, rather than just relying on the introduction of traditional ‘new season’ collections. That development, it is claimed, is creating a demand for air freight movements to reduce the ‘time to market’ period from manufacture in countries like China to display in US and European retail stores. “Whereas, in the past, fashion retailers had maybe four


or six seasonal collections a year – winter, spring, summer, fall, back to school, etc – the trend now, especially among younger consumers, is to want to see new products on the shelf whenever they walk into the shop,” explains Ole Ringheim, the Singapore-based senior vice president and global head, fashion logistics, for DHL Global Forwarding. “That means the retailers involved with that market have shorter and shorter product cycles, which in turn requires them to have more flexible supply chains.” BA World Cargo’s Cheetham has similar views. “Certain


retail outlets are running even fortnightly changes in fashion. That really does create a requirement for air freight,” he said. “We are also finding that emerging brands initially tend to use air freight to support their expansion and then once they have reached a certain size and maturity and have greater control over their supply chain, they try and move a bit more towards sea freight.” Seko Synergy’s Emerson agrees that the growth of ‘fast


fashion’ is having an impact on the air freight industry and wider logistics service sector, but he also points out that many retailers still retain the ‘seasonal collection’ approach to their business and therefore they have different supply chain requirements. “Fast fashion type retailers want to go from design to


sale in eight to 12 weeks and they can’t do that with sea freight, so air services will always play a huge part in their supply chain,” he stated. “However, season-led retailers with the two to three seasons a year approach will plan to move everything by sea, with the ability to air transport initial allocations and any good sellers, and of course not forgetting the air freighting of late production.”


MOVING COLLECTIONS Similar points are made by Volker Hoebelt, director sales


Hoebelt: “today, it is predominately sample merchandise that travels by air”


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