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Intimate apparel manufacturer turns to VCSTIMELESS to improve supply chain efficiency
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Sara Lee is the company responsible for several well known brands on the high street and its Branded Apparel division controls thousands of retail outlets throughout the world
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range from Champion sportswear to dozens of intimate
apparel brands, including Dim in
France, Gossard, Playtex and Wonderbra in the UK,
and Lovable in Italy. About 33 percent of its $19.5
billion turnover comes from apparel, and a lot of
growth in Europe is expected from setting up own-label
stores and retail franchise operations, specifically
in order to boost sales and brand awareness. Given
that Sara Lee manufactures and sells most of its
clothing through wholesale and retail
outlets, supply
chain excellence is of extreme importance. |
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For instance, in Italy, 75% of
its market is through either wholesale, traditional
retail or franchise stores, 9% through concessions
in department stores, and 16% through international
multi-channel sales and export. So the Sara
Lee Branded Apparel Lovable division in Italy
decided that in order to boost sales, it needed
to concentrate on the ‘bricks and mortar’ retail
branded outlets, rather than other, weaker multiple
channels. As a result, in 2004, the company
had opened over a hundred new stores in Italy
using the Lovable lingerie label. It is slowly
re-branding these stores as LO’, so that
by mid-2005, it will be selling a range of intimate
apparel under a new fascia, and re-designing
its stores so that they are all in line with
the same ‘youthful, brand aware’ look. |
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“We were far too manufacturing
focused with our previous IT systems, and not really
set up for retail,” said Giuseppe Zambarbieri,
Chief Information Officer at Sara Lee Branded Apparel
Italy. “Lovable lingerie was losing business
to wholesale and traditional retail, and so we needed
to get that back. That meant retailing ourselves,
either direct to the consumer, or through franchises
- which are proving to be a successful retail format
across much of Europe.”
Assisting new store
openings and maximising sales
Sara Lee Branded Apparel has introduced an integrated
mix of retail and supply
chain software through
VCSTIMELESS. It decided that in order to develop
its retail model and assist in the opening of
lots of new branded stores, it needed to offer
the tools to ensure successful retail operations.
Starting with Lovable in Italy, objectives for
the new system were to improve stock rotation
and reduce out-of-stocks, as well as provide store
staff with the necessary tools and information
to provide good customer service and optimise
sales.
Right product, right time, right location
With the new software in place, the Sara Lee Italian
head office is now able to suggest the ideal mix
of weekly orders and what retailers should be
stocking in order to maximize sales. The first
phase of the project involved addressing continuous
replenishment, and was successfully completed
in the summer of 2004. The outcome of installing
this new supply chain technology is that weekly
replenishment allows for a much greater reduction
in sales forecasting errors, so that retailers
are more likely to get the right product, at the
right time. “The costs of getting forecasts
wrong is extremely expensive,” said Zambarbieri.
New point of sale (EPoS) technology was rolled out
to all stores at the same time, with the added advantage
of staff more easily being able to view new collections
and order online, not to mention the benefit of
improved customer service in-store.
Seasonal demand
and intimate planning
The second phase, introducing assortment planning,
was addressed later in the year, just in time
for the busy Christmas trading period. This technology
deals with helping retail stores with budgeting,
and suggests best-selling ranges by region, store
location, or season. For instance, based on market
intelligence and analyzing historical sales data,
the software can deduce that underwear tends to
sell better for Valentines Day, and especially
red lingerie, so stores need faster replenishment
and suitably matched ranges.
Other benefits include:
- Significant cost reductions
as a result of less over-stocking (27%)
- Less
returns
- Improved store availability through use
of local trends at regional level
- Real-time synchronisation
of information with all stores
- Improved communication
- Easy-to-use system
Zambarbieri
of Sara Lee said: “After just
a few months of the fully installed system, we have
measured a number of Key Performance Indicators
(KPI’s) in our supply chain, all relating
to our goals, and can conclude that results are
very encouraging and we’re very happy with
the decision to adopt new technology. ”
Following the success of the supply chain project,
Sara Lee Europe has already opened some 15 Dim stores
in France and Benelux using the VCSTIMELESS Colombus
suite. The company also said that it is now determined
to boost the “retail strategy”, planning
to extend it to other European countries including
the UK, Spain, Portugal and Greece.
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