Spring - The Future of Supply Chains: Full Real-Time Visibility

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B U S I N E S S I N T E RV I E W

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THE FUTURE OF SUPPLY CHAINS:

FULL REAL-TIME VISIBILITY We talk supply chain strategy with the former VP of Global Supply Chain and Operations at Spring, Patricia Ahufinger.

atricia Ahufinger has worked in supply chain for over 20 years across multiple diverse industries.

She joined world-leading creator commerce platform Spring in 2015, and was at the company for seven years before taking on a new role earlier this year. Patricia explains, “I started Spring as the Regional European Supply Chain Manager and worked my way up to Vice President 3

(VP) of Global Supply Chain and Operations, overseeing all the supply chain that Spring had built. I have always been focused on the processes, end-to-end management and logistics, gaining a wealth of experience in this field during my time at Spring.”

Dedicated to powering commerce for the creator economy that has exploded in recent years, Spring now has more than nine million users.

Patricia says, “We have seen a rapid increase in the number of creators using the platform.

Spring allows them to monetise their efforts in creating content, so they can focus on what they do best, which is the creation process.”

Patricia describes the supply chain at Spring as ‘made to order’. It is a global network of carriers, suppliers and transportation companies that is regionalised, so the production network can be replicated in Spring’s main markets. Patricia explains, “We try to produce and fulfil all the orders as close to the customers as possible. If we see a market growing, we will try and set up our fulfilment network in that 4

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region. As of today, Spring has a very strong presence in North America, continental Europe and the UK. After Brexit, we had to reinvent our supply chain to make the experience smoother for our customers.”

Unlike traditional supply chain models, Spring is very demand-focused. This means they only manufacture when 6

an order exists, and do not rely heavily on forecasts.

Patricia continues, “It is very difficult to forecast because unpredictable events happen, as was the case with Covid.

We are therefore set up to produce only what has been purchased.”

There are two types of production model at Spring:

"Given our demanddriven supply network, we were able to be agile and flexible during Covid, shifting our production to where it could happen" In the first model, the products that we offer are created for immediacy. Off-the-shelf items are created, cut, printed and shipped in 24 to 48 hours. The product is more customised in the second model, with different patterns, silhouettes etc. Both models are about making sure the creators do not have to put up any money upfront, so there are no financial risks.”

1. Immediate fulfilment – the direct production of any order that has been placed in the platform.

2. Pre-sales – the consolidation of a number of orders during a pre-sale window. (Production only occurs when the window is closed.)

Patricia says, “The difference lies in the complexity of the product.

Speaking of unprecedented events, Patricia says Spring did not escape the impact of Covid, although the company was set up to weather the storm successfully. She says, “Given our demand-driven supply network, we were able to be agile and flexible during Covid, shifting our production to where it could happen. We experienced country lockdowns, labour shortages, stock shortages and delays in 7

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ports, but our initial set-up put us at an advantage. We are very interconnected with our partners in our network, and integrated with their systems, so in a matter of weeks, we could shift production depending on which production centre was up and running. There were delays due to the carriers having massive backlogs and longer transit times, but we managed to assign production and fulfilment

because we had a really good couple of years from a production perspective.”

Spring’s partnership with Lane Seven Apparel is a great example of a strong, long-standing relationship. Patricia explains, “It is not for us to suddenly find out that Lane Seven will have potential delays due to the backlogs at the port because we know where everything is at

"Lane Seven has been very flexible in helping us understand our demand in terms of volumes and quality of the product" orders to those partners that were capable of helping us.”

Demand exploded in the ecommerce ecosystem in 2019 and 2020. Patricia believes one of the keys to Spring’s success has been the relationships it has with its partners. She elaborates, “The way we treat our partners is extremely important. It has to be a close relationship because they need to adapt as fast as possible.

Covid actually strengthened many of these relationships

all times. This helps us massively because we can make sure products used in our platform and put in front of creators do not have major delays. Lane Seven has been very flexible in helping us meet our demand in terms of volumes and quality of the product. Creators want higher quality products and a good customer experience in terms of the reliability of the stock when promoting one of our designs.

Lane Seven work closely with us, sharing all the stock information 9

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"Full real-time visibility is a musthave for supply chains today.

You need to be interconnected, which is one of the things that Spring has always done"

we need to make informed decisions. They have been a great partner to Spring and will continue to be.”

So, what can a company do to improve its supply chain resilience and agility? Patricia answers, “The first step is to look at how you view your supply chain. You cannot have visibility with just your Tier 1 suppliers. It is crucial that you understand who you work with. It is not enough to rely on the last part of your chain either. You need to know where things come from and be able to map out the whole lifecycle of a product.”

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"Customers don’t want any more greenwashing. They are concerned about where their products come from, and you have to prove it"

Patricia summarises as follows: 1. Your approach – know where your products come from, do your due diligence, and identify risks where the supply chain could be broken if an unexpected event happens e.g. if you rely heavily on single-source suppliers, find alternatives.

2. Trust the IT systems – get integrated with a platform that allows you to connect with all your suppliers, collaborate online, and have full real-time visibility.

Patricia adds, “Full real-time visibility is a must-have for supply chains today. You need to be interconnected, which is one of the things that Spring has always done.”

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Being able to prove a product’s ESG performance level is also becoming increasingly important for supply chains. Patricia explains, “Customers don’t want any more greenwashing. They are concerned about where their products come from, and you have to prove it. At Spring, we started looking into the

materials we use, as well as asking for certificates when onboarding partners, so we know that they are doing their due diligence and making efforts to be more sustainable. When you source a new vendor, if you want a longstanding relationship, there has to be a match in terms of their vision of what the world should look like.

I think companies are making progress with their sustainability agendas, starting with visibility and taking steps to correct the things that need to be corrected.”

For large organisations with traditional supply chains and decades of history, change can be a difficult task. But people are 13

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starting to challenge the status quo, as Patricia explains, “The old model of outsourcing everything single-source to Asia or Central America, only thinking about the cost, is simply not working anymore. This is because these companies will struggle to adapt if there is disruption in the market, as well as requests to be more sustainable from customers, governments, and every single player.”

As for the future of supply chains, Patricia concludes, “It is exciting to see how companies are starting to adopt the Industry 4.0 approach, and looking into opportunities for near-shore production. Technology is allowing this change to happen. You can see more efficient, on-demand production set-ups alongside the concept of the microfactory, which is now becoming reality, as many big companies are starting to invest resources in this area. In the next five years, I believe we will see examples of brands bringing a portion of their production closer to the customer, as well as implementing microsite production sites.”

For further information on Spring, visit www.spri.ng 15

www.spri.ng