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UK chains could slash sourcing costs

Retailers in the UK could save more than £6.3 billion by changing their sourcing operations, according to management consultant McKinsey & Company.
The group’s Fashion Sourcing report looks at fast fashion and fabric sourcing, based on interviews with more than 200 companies in the past five years.

German-based McKinsey has devised a 10-point plan for retailers, and outlines myths about sourcing efficiency. The report warns that cutting out agents and importers can increase the cost of sourcing, and adds that it can be cheaper and more beneficial to train suppliers in manufacturing technology than to repeatedly pay premium prices for highly qualified manufacturers. It also adds that retailers should not leave sourcing to suppliers.

McKinsey associate principal Achim Berg said: “Having a fully integrated supplier, where the mill and garment production come out of the same location, could also help.”

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