A Retail Distribution Case Study That Delivers With Style.
How Liz Claiborne Ships To Over 26,000 Retail Locations.
Liz Claiborne, Inc, with annual sales exceeding $3.4 billion, is one of the
top fashion design firms in the world. The Company’s portfolio of 26
brands span most apparel and non-apparel categories, reaching consumers
regardless of age, gender, size, attitude, shopping or value preference.
Liz Claiborne’s brands are available at over 26,000 different retail
locations throughout the world, including virtually all upscale, mainstream,
promotional and chain department stores, the Company’s own specialty, outlet
stores, and E-commerce sites.
The Demands Of Keeping Up With Daily Fashions Take
On New Meaning.
Since the company’s founding in 1976, the company met its ever growing
distribution requirements with additional facilities duplicating the
original distribution processes and designs. While meeting the demands of
the company, the network did not take advantage of the economies of scale
that could be achieved for a multi-billion dollar company.
Three fundamental shifts in the industry further complicated distribution
operations. First, Liz Claiborne’s retail customers eliminated the
services performed in their own distribution centers, moving the burden to
their suppliers, and charging millions for compliance errors.
Secondly, a massive consolidation in department store segment caused a
concentration of shipping volumes into smaller and smaller periods of time.
As a consequence, the distribution centers experienced huge unpredictable
swings in work flows from week to week making efficient staffing and labor
planning nearly impossible.
Thirdly, for competitive reasons, Liz had to raise their service standard to
ship 96% of all retail locations within two days of allocation.
Liz Called SDI Consulting And Found A Great Fit.
All of the above objectives were combined into a strategic initiative, the
Product Movement Initiative (PMI). Liz decided that the company needed
assistance to develop, define improvements and create recommendations
for the PMI. Liz called SDI Consulting.
We Looked, We Knew, We Recommended.
The experts at SDI reviewed the current facilities, projected and simulated
order profiles for the entire Liz distribution network, we knew where to
make improvements and presented our recommendations:
- Eliminate the space, bottleneck and flow issues from the style/collection
merchandise storage techniques and change to dedicated product storage areas
for flat and hanging product. The slotting of product was also randomized
for better workload balancing and product flow.
- Replace paper-based processes with a radio frequency bar-code scanning
system that allows data to be captured and exchanged at key points in the
process. Real-time information made available to a warehouse management
system for overall control and monitoring of production and work management.
- Implement in-line labeling to automatically label outbound cartons with
the retailer’s specific carton marking requirements and weigh in motion
scales coupled with bar code scanning to automatically build the freight
manifest.
- Change static paper-based batch order picking process to fluid wave
processing. Orders are pooled by SKU and customer into waves. The waves are
released for processing where the computer system collates all like product
into work orders for picking providing for mass order fulfillment. The
picked merchandise is then inducted onto high-speed hang and flat sorters,
scanned, and orders fulfilled automatically and carton content information
uploaded for billing and ASN creation.
These recommendations were first implemented in Liz Claiborne’s HQ1 800,000
square foot facility in North Bergen, NJ, then rolled out to the 1.2 million
square foot facility in Mount Pocono, PA. After the successful upgrade of
those two facilities, a new 595,000 square foot distribution facility in
West Chester, Ohio was built employing the same technologies.
The Results Are A Perfect Fit.
Liz’s distribution productivity has increased more than 45% since the
retrofit and expansion of the HQ1 and Mt. Pocono facilities. The HQ1
distribution center now ships more than 15 million units a year with a daily
capacity of over 125,000 units. The Mt Pocono distribution center ships
more than 40 million units per year with a peak daily capacity of 325,000
units. West Chester ships 32.5 million units per year, with a peak daily
capacity of 300,000 units. Now that’s moving some product.
Our Client Knows What We Do.
“The productivity increases associated with the ROI for the three facilities
is right on target”- Joe Giudice, Vice President Global Logistics, Liz
Claiborne.
Expert Thinking At SDI Consulting.
We're the best group of experienced, strategic, logistical, customer-focused
materials handling expert thinkers on the planet. Our consultants
have over 125 years of collective industry solutions in the retail
distribution environment.
For more information on Liz Claiborne contact:
Patrick Eidemiller
or Mary Adams
