Benetton's 'Dual Supply Chain' System|Operations|Case Study|Case Studies (2024)

Abstract:

The case discusses the dual supply chain system practiced by Italy based clothing company Benetton SpA (Benetton). During the 1980s and early 1990s, Benetton was the world leader in the casual apparel market with stores spread across the world. The company was well known for its postponement strategy, wherein the dyeing of the garment was postponed till the colors in vogue for the season were identified. By the late 1990s, Benetton could not compete with the fast fashion retailers which were launching several collections a year, as against only two collections brought out by Benetton. In order to meet the changing demands of the customers, Benetton revamped its supply chain, and opted for a Dual Supply Chain system.

In this system, production was carried out in Asian and European countries, depending on the time required to market the product. The dual supply chain focused both on pull as well as push based demand. After implementing the new supply chain system, Benetton was able to launch five collections in each season, with some of the collections incorporating the latest trends. The case explains the postponement strategy of Benetton, the supply chain problems it faced in the late 1990s and the Dual Supply Chain system.

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Keywords:

Benetton SpA, Supply Chain Management, Dual Supply Chain, Fast Fashion, Vertically Integrated Model, Production, Distribution Center, Retailing, Postponement Strategy, Retail Management, Delocalization, Sorting System, Product Delivery

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