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APPLYING SYSTEM DYNAMICS APPROACH TO FAST FASHION SUPPLY CHAIN: CASE STUDY OF AN SME IN INDONESIA Mariany W. Lidia 1, 2+, Takeshi Arai 1 , Aya Ishigaki 1 and Gatot Yudoko 2 1Department of Industrial Administration, Tokyo University of Science, Tokyo, Japan2School of Business and Management, Institut Teknologi Bandung, Indonesia ABSTRACT Currently, many apparel companies are shifting toward the vertical integration, and accordingly, their production processes range from raw materials to ready-to-wear clothes. Fast fashion is a concept whereby retailers orientate their business strategies to reduce the lead time for fashion products to store.This is can be achieved by working on a system of in-season buying so that product ranges are consistently updated throughout the season. Since success depends on speed, in the apparel industry, fast fashion retailers must quickly respond to market demand. In addition, defining the target market is essential for running a successful fashion business. Without sufficiently analysing an appropriate setting for the target market, a company is likely to waste time, money, and resources; for instance, marketing to the wrong customers and communicating with those not interested in the products. Therefore, supply chain management has important roles in coordinating processes along the supply chain to reduce the lead time of finished goods and meet consumer demand. Small and Medium Enterprises face the challenge of learning to manage their financial performance and attain high profit without incurring redundant costs.Therefore, this research develops a model on supply chain of an SME apparel company in Indonesia and proposes a decision-support system that applies System Dynamics and helps the management identify thebest business strategy. KEYWORDS System dynamics, fast fashion, supply chain management, SME, Indonesia