Shein

In this talk, recorded at PI Apparel Hong Kong, Stanley Szeto, Executive Chairman of Lever Style Inc., shares his insights on the paramount importance of speed and versatility over cost in today’s apparel industry. Here are key highlights from his talk:

1. He introduces Lever Style as a one-stop apparel supply chain platform, emphasizing its role in offering flexibility in terms of lead times and order sizes rather than competing on the lowest labor costs. This approach aims to help brands reduce inventory risk, showcasing a shift from traditional cost-saving measures to a more dynamic, responsive strategy.
2. Stanley highlights Lever Style’s evolution from a shirt manufacturing company in 1956 to a modern, asset-light supply chain platform. The company’s strategic shifts, including horizontal integration and expansion beyond China, illustrate its adaptation to the changing landscape of apparel manufacturing and distribution.
3. The talk underscores Lever Style’s collaboration with premium fashion labels and digitally native brands, stressing the significance of speed and flexibility in catering to the needs of a diverse clientele. Examples include working with Stitch Fix on a private label program that leverages quick response to consumer demand, significantly reducing inventory risk.
4. Stanley explains Lever Style’s ability to manage high mix, low volume production, which is crucial for brands seeking to offer a wide array of SKUs and sizes without the burden of excessive inventory. This capability enables brands like Bonobos and Third Love to offer extensive sizing options, enhancing customer satisfaction through better fit and variety.
5. The presentation delves into the financial and operational benefits of prioritizing speed and versatility, including minimizing stockouts and working capital needs. Szeto uses comparative analyses to demonstrate how this approach can lead to higher gross margins and profitability, contrasting traditional models that rely heavily on deep discounting to clear excess inventory.
6. Lever Style’s success and the broader industry implications are discussed through comparisons with companies like Gap and Zara. Szeto points out the stark differences in market capitalization and efficiency, attributing Zara’s success to its fast-fashion model that emphasizes quick turnaround times and responsiveness to market trends.
7. Finally, Stanley touches on the challenges and opportunities presented by companies like Shein, which have taken the principles of speed and versatility to new heights. He acknowledges the controversies surrounding such models but advocates for the adoption of their efficient supply chain practices, tailored to support sustainable, quality-focused brands.

The session illustrates the shifting priorities in the apparel industry, where speed, flexibility, and responsiveness to consumer demand are increasingly becoming key determinants of success.