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f+h Intralogistics 1/2016

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f+h Intralogistics 1/2016

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02 Following restructuring the supply chain is flexible and can respond to the large changes in the market environment of the fashion industry SUPPLY CHAIN MANAGEMENT A further change in paradigms arose through introducing product sales covering all seasons. The fashion industry works world-wide in at least two and up to four seasons or collections. At the end of one season the goods are marked as EOSS (End of Season Sales) and sold off. The remaining levels of stock are returned, in order that they can possibly be sold off in the next season, usually however they remain as obsolete stock in the warehouse. Especially in India it does not make a lot of sense to have an end of season sale, in large parts of the country there are no real differences between the times of year. For this reason Miebach only introduced the new principle in selected regions with the result that the costs of retrieval and the obsolete stock levels were reduced. One of the most difficult steps was the reduction of obsolete stock from the past, as in the short term this leads to considerable writeoffs and would have a negative effect on the profit and loss account. From experiences in European online business, Miebach Consulting set up a pilot study to sell goods which could not be sold outside of the national market. In spite of this it was unavoidable that a part of the stock from this time would have to be written off as unsalable. Supply chain initiatives The global fashion industry is highly volatile, making market forecasts and predictability of trends difficult – to forecast the demand for an item exactly requires almost prophetic talents. In such a market environment a supply chain must be flexible and able to respond (Illustration 02), in order to prevent stocks of unsalable goods building up and at the same time to prevent “stock outs”, where items the customer wants sell out. The existing push replenishment system used by AFL regularly led to excessive levels of stock in the retail outlets, however often also to stock selling out in individual sales outlets, because whilst the goods were available in the overall system, they were however not available locally. For this reason a conversion was made to a continuous replenishment system according to the pull principle from retail via the storage warehouse through to production. The push part in the initial delivery was reduced to between 30 and 40 percent. By proceeding in this way the supply chain could be synchronized with the market needs, and alongside a reduction in stock levels as well as above all a higher product availability at the POS could be achieved. It was certainly more difficult to organize the change in production with respect to a “late fit” philosophy. On the grounds of the economic and technical limits of reducing the batch sizes and the throughput times, an improvement here could only be achieved by integrating the suppliers. A more intense networking of information as well as committing the suppliers to stock up with sufficient levels of the primary and intermediate products led to a reduction in the throughput times and to higher flexibility. The outcome of the restructuring measures was that improvements could already be achieved in the first year of the changes supported by Miebach Consulting: n Reduction of days of inventory held to below 90 days (60 days) n Increasing product availability to 90 percent (96 percent) n Reducing Supply Chain costs by 15 percent (25 percent) In the first year of the project the fashion goods manufacturer already managed to achieve a „turn around“ and this had a positive effect on cash generated. The free liquidity from that point on can be invested in further growth and the successes up to now give confidence that the objectives set out shall be achieved in full. Pictures: lead photo Fotolia, 01 – 02 Miebach Consulting www.miebach.com About Miebach Miebach − The Supply Chain Engineers – deliver their services worldwide across 20 offices from Bangalore to Santiago de. With 320 employees and a yearly turnover of 38,6 million Euros (2014) the company is one of the leading consultancies for logistics, production and supply chain design. Miebach’s worldwide network in key regions of Europe, North and South America and Asia provides effective international support for clients. f+h Distribution 1/2016

Vojislav Jevtic, Regional Manager, Air & Sea Asia at Gebrüder Weiss, explains the rail route Multimodal between the Baltic and the Bosphorus Gebrüder Weiss, international transport and logistics company from Austria, is expanding its service portfolio on the Bosphorus by adding a key strategic product: as of now, freight transports between Turkey and the Baltic Sea will also be transferred to the railway network. The basis for this new service is a cooperation agreement with the national, state-owned Lithuanian Railways. As a result, Gebrüder Weiss can offer its customers a multimodal transport alternative between Istanbul, Ukraine and the Baltic states. And this is a good way to serve Russia and Scandinavia, too. Low-emission rail transport is not only an environmentally friendly alternative to sea transport via the Mediterranean/Atlantic route but with a journey time of eleven days, it is also nearly twice as fast. The entire rail route is 1,734 kilometres long and runs along central traffic hubs in Southeastern and Eastern Europe. www.gw-world.com DB Schenker restructures its European business DB Schenker Logistics has restructured its European business, merging four management regions into one. With 40,000 from a total of 65,000 employees, the European region has been the largest business division of the company – a logistics subsidiary of Deutsche Bahn AG (German Railway) – since January 1, 2016. The 36 national European organizations are now combined into ten country clusters. Ewald Kaiser (Image) has been named as the Chief Executive Officer of the new European Region, and will continue to be responsible for overland transport on the Management Board of Schenker AG. www.dbschenker.com FedEx Express opens new Nordic gateway at Copenhagen Airport End of January, FedEx Express, one of the world’s largest express transportation company, officially opened its new gateway facility at Copenhagen Airport. The new facility will serve as a gateway for inbound and outbound shipments for Denmark, Finland, Norway and Sweden. It marks the ninth new FedEx Express facility in the Nordic region in the last five years. “The Nordic gateway will bring our Nordic customers even closer to the rest of the world. By combining courier, customs clearance, sortation and aircraft operations in a single location, we will further enhance operations in the Nordics. I am delighted that we are fully operational just over a year after we announced this investment,” said David Canavan, senior vice president, Operations, FedEx Express Europe. www.fedex.com Bench relies on Hellmann eCommerce fulfillment Hellmann eCommerce’s pitch for the implementation of international fashion and lifestyle brand, Bench’s B2C online shop fulfillment-development has prevailed against the other fullservice providers. Since February 2016, Bench customers in 21 European countries will be supplied from the fulfillment center in Osnabruck. E-commerce via their own web shop is becoming an increasingly important sales channel for Bench. In order to ensure excellence in this extraordinary brand’s order processing, Hellmann eCommerce undertakes the order management, financial services and international logistics as Bench’s fulfillment service provider. The Hellmann eCommerce system architecture guarantees assured and efficient processing throughout the entire order process. All systems, e. g. shop software Oxid, the Bench ERP and warehouse management system are integrated via Hellmann’s Middleware. This enables implementation of Bench’s planned multichannel strategies within the shortest time, in order to offer the end consumer an integrated shopping experience. www.hellmann-ecommerce.com Click to read previous issues. Inspiration is just one click away. News about the following markets: f+h Distribution 1/2016

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