MECHANISM OF CASCADING VALUE TRANSMISSION IN THE TEXTILE AND APPAREL INDUSTRY

Abstract

PROBLEM STATEMENT. Customer experience management (Lemon & Verhoef, 2016) has developed predominantly in the business-to-consumer segment; its extension to business-to-business (De Keyser et al., 2025; Wirtz et al., 2025) remains constrained to dyadic supplier–customer relationships. The textile and apparel production chain encompasses three functional levels, at each of which a distinct customer experience is formed, with the downstream experience partially conditioned by the value received in the upstream tiers.

PURPOSE. To substantiate the mechanism of cascading value transmission in customer experience formation within the textile and apparel production chain and to define the role of absorptive capacity as moderator of value transfer between levels.

MAIN HYPOTHESIS. Customer experience in the textile and apparel production chain is formed cascadingly: value received by a participant of exchange at one level is transformed into an operant resource and transmitted to the next level, with the effectiveness of each transition moderated by the recipient's absorptive capacity.

METHODS. Abstraction, comparison, classification, systems approach.

RESULTS. A mechanism of cascading value transmission is proposed: value-in-use received by a participant at one level is transformed into an operant resource and integrated into the participant's value proposition for the next level, with effectiveness determined by the recipient's absorptive capacity. The mechanism is projected onto the three-level architecture: equipment supplier – factory – brand and end consumer.

CONCLUSIONS. The mechanism links three concepts: service-dominant logic, absorptive capacity theory, and the typology of business-to-business value propositions. Investments by upstream suppliers in midstream customer experience generate an effect that extends beyond dyadic relationships and influences end-consumer experience, provided sufficient absorptive capacity at each level.

KEYWORDS: absorptive capacity; cascading value transmission; customer experience; service-dominant logic; textile and apparel industry.