Value Chain Alignment

At its core, the Value Chain Alignment (VCA) programme focuses on forging synergies between clothing and textile suppliers and the major clothing retailers they supply. In this respect, the securing of retail involvement has been critical in establishing a forum to facilitate interventions for alignment through the value chain. In addition, participating retailers and the Durban Investment Promotions Agency (DIPA) have made a generous financial commitment to the cluster, permitting the expansion of core activities.

To date, seven retailers provide support to the cluster either directly as members, or indirectly through the Cape Cluster, the KZN CTC’s sister organisation, and through annual donations for specific support interventions.

The core focus areas of the VCA programme are as follows:

• International retailer best practice research and local retail alignment
• Benchmarking report for each retailer
• Market access promotion
• Energy efficiency clubs
• Sea freight rates
• Manufacturer Retail Perspectives Survey

Each of the core focus areas is unpacked below:
 

  

International Retailer Best Practice Research and Local Retail Alignment
 

The KZN CTC develops knowledge and understanding relating to the supply chain management best practices internationally, in order to provide a comparative analysis of local practices and then align the two. The research is used to identify the world class supply chain tools that measure and assess supplier performance within the clothing and textile value chain and other elements deployed by leading retailers that provide a competitive advantage through the value chain.  This is to ensure fair, objective evaluation and retailer support in upgrading of the local suppliers’ manufacturing capabilities. This knowledge base requires ongoing development in order to keep pace with best practice. As this knowledge base is developed, it feeds into the training and evaluations rolled out to assist retailers and manufacturers in developing the competitiveness of their supply base.
  

 

Benchmarking report for each retailer
 

Each retailer member of the KZN CTC receives an annual benchmarking report and presentation, outlining the competitiveness challenges throughout its domestic value chain. This report is based on the aggregated findings to emerge from firm-level benchmarks and the research undertaken, thereby identifying gaps and opportunities.
 


Market Access Promotion
 

The KZN CTC also promotes market access for its members through the facilitation of "meet and greet sessions" between the sourcing executives and buyers of the major retailers and the KZN CTC members. The aim of these sessions is to enable the retailer's sourcing executives and buyers to identify new sources of manufacturing.  It also affords the clothing, textile and footwear manufacturers with the opportunity to display their merchandise, manufacturing and technical capabilities.


Energy Efficiency Clubs

The current lack of stability in energy supply poses a major operational threat to some firms, and a major productivity cost to others.  In order to enable firms to improve their energy efficiency and ensure that this does become an increasing operational cost, firms will be invited to become part of a energy efficiencly club.  The club participants will receive high level support from experienced energy management professionals. The focus of the energy club will be twofold. Firstly club participants will receive technical training. Topic areas include:

• Metering, monitoring, targeting and reporting
• Compressed air
• Motors and drives
• Lighting
• Airconditioning
• Effluent
• Water management

Furthermore, club participants will be expected to conduct improvements in their factories on the basis of technical training and report progress at club meetings.

Key stakeholder engagement will be undertaken with representatives from Eskom and eThekwini Municipality. The KZN CTC member firms will be kept informed of the demand and supply side programmes in place, and will be guided in the use thereof.


Sea Freight Rates

 

On the basis of the success of the preferential sea freight rates which have been negotiated through the Durban Automotive Cluster, the KwaZulu-Natal Clothing and Textile Cluster’s intention is to secure preferential sea freight rates for KZN CTC members.


Manufacturer Retail Perspectives Survey


The KZN and Cape Clothing and Textile Clusters receive invaluable information on the performance of the local clothing and textile industry relative to the demands of local retailers through customer benchmarks.  As governors of the value chain, the retailers’ management and communication through their respective supply chains is increasingly recognised as central to enabling suppliers to meet their requirements. At the behest of the retailers, a pilot study was undertaken in 2009 to determine if the major retailers’ performance in this regard can  be compared, which retailers performance is perceived to be ahead/behind others’, and to identify opportunities for mutual improvement.  This study will be repeated in 2010.  The intention going forward is to gauge the extent to which value chain alignment is being achieved, a key determinant of future success in the marketplace.
 

Back To Top