Despite a challenging retail environment, the outlook for Micro, Small, and Medium Enterprises (MSME) has never been better.Today, digital trading platforms, apps and other ‘shared’ models have changed the game - knocked down barriers - and given smaller businesses much greater entry into the market.Boundary-Breaking ServicesCloud-based computing, often referred to as SAAS (software as a service), along with the proliferation of platforms that support almost every phase of the supply chain - from product development to retail, has put sophisticated services within reach of most companies.The adoption of technology - from on-demand 3D samples, to digital printing and through to subscription-based PLM access - had made it easier and more affordable to be flexible and more agile.Helping SME's Compete• Use of shared services - from 3P to outsourcing specialist functions.• Shared or ‘third party’ (3P) services is helping even larger companies have a more extensive footprint in more sourcing nations, as well as bringing greater expertise to the table. • An openness by employers to hire people on a part-time or consultant basis is providing companies with budget constraints an affordable option for bringing in the talent and experience they need.• The global apparel market is forecast to reach $1.2 trillion by 2020 (Statista). The ongoing demand for more unique products will support the growth of indie brands, along with the services that support them. Finding ways to work with these brands will be increasingly important for manufacturers.The Challenge for SuppliersTechnology will continue to democratize the supply chain. E-commerce will keep enabling small businesses to sell their products anywhere in the world. At the same time, on-demand services are helping with logistics and product development. The biggest challenge now - the last frontier - is manufacturing both materials and finished garments. Technology has helped to boost efficiency and quality - but it has not really enabled factories to get a share of the growing demand from small brands.The industry still is heavily geared towards big volume manufacturing models. And while demand from major brands for smaller orders and shorter lead times has moved manufacturing towards being more agile, few factories are able to handle small, let alone micro, orders. Looking for a SolutionThe much-heralded move to fully automated garment making has yet to arrive. Other than in niche instances, even sophisticated companies have not succeeded in making this work. For example, last year Adidas closed tits fully automated footwear factories in Germany and the U.S. and moved the production back to Asia, along with the technology. Others have had similar experiences.At the same time, executives who run micro factories face huge hurdles in planning. These factories, which typically work with digital native brands, struggle to with planning when orders are driven by the day-to-day orders from these brands’ online stores.Untapped OpportunityThe quest for more agile production has never been greater. Looking ahead, we expect to see a greater move towards shared resources - especially in factories. This is not something new, but few companies are doing this. Sharing requires a level of trust that is not easy to establish. However, with many factories facing idle capacity, and others not wanting to invest in expansion when orders remain unstable, sharing is starting to gain popularity.For most this means leasing out one or more lines in a factory. Unlike in subcontracting, in the sharing model the company who is the “tenant” will bring its own management to be on site during production, as well as any support staff such as technicians, QA team and so forth. We also expect to see agents play a bigger role in the future of sourcing. They’ll be able to play a vital role in helping to manage shared resources. Most already provide a growing portfolio of services to their customers - from product development and fabric sourcing to 3D sampling. As smaller brands grow they will need to compete in an increasingly demanding market. Agents will find new opportunities here, if they can handle smaller orders.This level of support is going to be in bigger demand by larger brands too as they look for ways to streamline their operations, diversify sourcing and hedge risks.