GLOBAL TRENDS IN RETAIL AND FASHION LOGISTICS

Transcription

1 GLOBAL TRENDS IN RETAIL AND FASHION LOGISTICS DEVELOPMENT, CURRENT STATUS, AND POTENTIAL Dr. Herbert Kotzab, Professor, CBS, Kolding, Slide 1

2 Welcome to the session in advanced retail! That means the instructor finds the subject confusing. If s/he didn't, the session would be called elementary retail and fashion logistics. Slide 2 Luis Alvarez Nobel Prize in Physics in 1968

3 Agenda 1. Current issues modern retail and fashion logistics 2. Megatrends for retail and fashion logistics 3. Some empirical benchmarks 4. Key learnings Slide 3

4 Retail is not rocket science, isn t it? Slide 4

5 Let s take a simple shoe store Slide 5

6 What are the logistical dimensions behind this offering? Three main categories Women, men, kids Within the category women Shoes, bags, accessories, trends, extra sizes, sales Within women shoes More than 80 brands, 27 sizes, 11 colours, 21 styles Prices range between 19 and 299 Slide 6

7 Retail logistics deals with complexity Slide 7

8 And retailers have invested a lot into modern logistics Slide 8

9 . cross docking processes at DClevel. Suppliers deliver full truck loads of products Transitterminal = place of break bulk, sorting and handling Customer specific (=retail outlet specific) deliveries aaaaaaaaabbbbbb bbbbccccccccccccc cccccccccccccccccc A B C Receiving dock Customer ready order preparation CROSS DOCKING Takes not longer than 24 to 48 hours Shipping dock aaaaaaaaaaaaaabb bbbbbbbbbbbbbb bbbbbccccccccccc aaabbbbbbbbbbb bbbbbbbbbccccccc cccccccccccccccccc aaaaaaaaaaaaaaaa aaaaaaccccccccccc cccccccccccccccccc aaaaaaaaaaaaaaaa aaaaaacbbbbbbbb bbbbbbbbbbccccc Slide 9

10 flow-through technology. Slide 10

11 pick-by-light- or pick-by-voicetechnology. 19_DE_Distribution.pdf Slide 11

12 . fast sorting technology. Slide 12

13 Slide 13 S_Cosmetics&sid=rv6mh5udl96288fdo308pk83rfljm4ca#imgdiv

14 removed chaotic storage Slide 14

15 . and unergonomic working conditions.. Slide 15

16 ..and still fail to move merchandise to the shelves Slide 16

17 However, is this the perfect answer never out of stock? Slide 17

18 Let s have a look at our logistics future Slide 18

19 10 great forces in societal development will affect logistics by 2020 Ageing Hypercomplexity Globalization Technological development Knowledge Prosperity Individualization Immaterialization Commercialization Health Environment Acceleration Network organizing Polarization Urbanization Slide 19

20 Some specific Supply Chain Megatrends Alignment between demand and supply Push-to-pull in order to get demand-driven Improved visibility Offshoring/outsourcing through virtualization Centralization Lean supply chains Risk Management Sensory Networks Slide 20

21 Today s outsourcing searches for economies of flat world Slide 21 Three innovations made the world flat: PC, fibre optics and workflow-software.us-american auditing firms outsource routine work such as preparation of tax declarations to India and concentrate on strategic issues.. Radiologists of small and medium sized US-based hospitals delegate the analysis of CT-scans to doctors in India and Australia. The analysis is completed while the US-based doctors are sleeping.

22 Hypercomplex sourcing structures the example of the Boeing 787 Slide 22 Christopher (2008)

23 Global textile supply chains are long and winding roads Slide 23 During a 1999 protest of the World Trade Organization, Rivoli, an economics professor at Georgetown, looked on as an activist seized the microphone and demanded, "Who made your T-shirt?" Rivoli determined to find out. She interviewed cotton farmers in Texas, factory workers in China, labor champions in the American South and usedclothing vendors in Tanzania. Economy- Economist/dp/ /ref=sr_1_1?ie=UTF8&s=books &qid= &sr=8-1

24 This is the travel of a T-shirt Slide 24

25 And this is needed for a simple pair of men s cotton slacks Slide 25

26 The dilemma of globale textile supply chains Slide 26

27 So, how should tomorrow s logistics look like? Slide 27

28 The revival of city logistics for the supply chain of the future Slide 28 GCI/CapGemini (2008)

29 ..which we knew from 1967! Slide 29 Doody/Davidson (1967)

30 Let s have a look at some benchmarks Slide 30

31 Today s winner in fashion retailing are vertically integrated sales machines! Slide 31

32 Manufacturers like Triumph International respond to this trend Slide 32

33 Whatever Zara is doing, they do it perfectly wrong unbeatably successful! Slide 33

34 And companies like M&S struggle with their competitive response Slide 34

35 The missing link for many fashion retailers. Slide 35

36 Is RFID the answer to solve all issues? Slide 36 name=published/emeraldfulltextarticle/articles/ html

37 Have a look at simple barcoding first.. Time (min) Manual EDI Ongoing recording of items on stock (pro rata) - 45 Recording of total inventory Determining order quanities 30 5 Generate order Gather order 45 - Activities related with receiving products 45 5 Label products and controlling received 60 - quantities Total Slide 37 Savings = 7 hours and 30 minutes Example of reduction of activity complexity for a retailer when using EDI based on an order of 120 pieces comparing manual administration and EDI-administration

38 Let s sum up Slide 38

39 From a fashion blog: The fact is that buyers are becoming preference savvy and smarter in order to what they shop. Even though they always have their preferred designer, they are also acquainted that a throwaway piece of fast fashion from a retail chain store will complete their outfit choices. At so reasonably priced all of these retail perceptions play on Friday nights when people feels they have nothing to wear. Slide 39

40 You need to be aware of managing an end-to-end fashion supply chain! Slide 40

41 .. and bear in mind that. Future sales at SKU-level are difficult to predict; fast changes lead to increased obsolesence; high street front stores increase costs; each unsold piece represents a cost 50 euro cents per piece per day production times get shorter and delivery times more tight; quality needs to be controlled at origin instead at destination; one hub is used for multi-country-consolidation in one hub; a low number of pieces is highly rotating and frequently replenished. Slide 41

42 However, this is going to revolutionize retail! Slide 42

43 Despite all megatrends the basic tasks of SCM will remain 1. Design, organize and operate networks for the provision of customers and consumption stations with the required goods in due time at lowest costs. 2. This includes the scheduling of the resources and the replenishment of the stocks in the logistic chains. 3. These tasks arise between companies, suppliers and customers. Slide 43

44 What so what now what? Slide 44