5/29/2013 1 Mitigating Margin Risk Through Supply Chain Performance – Panel Discussion Camille Fratanduono, AVP, Pricing & Replenishment, Pep Boys Greg Holder, CEO, Compliance Networks Rick Schart, VP of Supply Chain, Stein Mart Richard Wilhjelm, VP, Sales & Business Development, Compliance Networks May 19, 2013 Today’s Panel Camille Fratanduono, Asst. VP, Pricing & Replenishment, Pep Boys, Inc. Greg Holder, Former Retailer, CEO, Compliance Networks, Inc. Rick Schart, VP of Supply Chain, Stein Mart, Inc. May 21, 2013 Page 2 Margin Risk -Overview From a retail perspective, defined as the potential permanent loss of margin due to both internal and external performance related events Margin, Like Product has a Shelf Life Seasonal Promotional Competitive Supply Chain Opportunity –Margin Contributor vs. Cost Center May 21, 2013 Page 3 Who is Stein Mart? May 21, 2013 Page 4 Stein Mart is a national retailer offering the fashion merchandise, service and presentation of a better department or specialty store, at prices competitive with off-price retail chains Founded in 1908 as a single store in Greenville, MS 263 stores in 29 states Headquarters -Jacksonville, Florida Sales = $1.2 Billion Stein Mart Supply Chain Transformation Using data and reporting to support the Company by: Providing visibility to PO status from vendor shipment to store delivery including: • Status of vendor POS ticket orders • Special Hot log for tracking advertised goods • Special reports tracking receipts for new stores Tracking timeliness and accuracy of vendor shipments Tracking vendor compliance with EDI and floor ready requirements including: • ASN [856] –utilization and accuracy • GS1-128 Carton Labels • POS ticketing • Hanger requirements This data allows us to insure goods hit our sales floor as planned. May 21, 2013 Page 5 Who is Pep Boys? May 21, 2013 745+ locations located in 35 states and Puerto Rico $2.0+ Billion in Revenues Ecommerce enabled –ship to store & ship to home Online service appointment capable through e-SERVE Leading Automotive aftermarket retail and service chain comprised of 3 major lines of business; Service, Retail and Commercial (B2B) Page 6
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5/29/2013
1
Mitigating Margin Risk Through Supply Chain
Performance – Panel Discussion
� Camille Fratanduono, AVP, Pricing & Replenishment, Pep Boys� Greg Holder, CEO, Compliance Networks� Rick Schart, VP of Supply Chain, Stein Mart� Richard Wilhjelm, VP, Sales & Business Development, Compliance Networks
May 19, 2013
Today’s Panel
� Camille Fratanduono, Asst. VP, Pricing & Replenishment, Pep
Boys, Inc.
� Greg Holder, Former Retailer, CEO, Compliance Networks, Inc.
� Rick Schart, VP of Supply Chain, Stein Mart, Inc.
May 21, 2013 Page 2
Margin Risk - Overview
� From a retail perspective, defined as the potential permanent
loss of margin due to both internal and external performance
related events
� Margin, Like Product has a Shelf Life
�Seasonal
�Promotional
�Competitive
� Supply Chain Opportunity – Margin Contributor vs. Cost
Center
May 21, 2013 Page 3
Who is Stein Mart?
May 21, 2013 Page 4
Stein Mart is a national retailer offering the fashion merchandise, service and presentation of a better department or specialty store, at prices competitive with off-price retail chains
� Founded in 1908 as a single store in Greenville, MS
� 263 stores in 29 states
� Headquarters - Jacksonville, Florida
� Sales = $1.2 Billion
Stein Mart Supply Chain Transformation
Using data and reporting to support the Company by:
� Providing visibility to PO status from vendor shipment to store delivery including:
• Status of vendor POS ticket orders
• Special Hot log for tracking advertised goods
• Special reports tracking receipts for new stores
� Tracking timeliness and accuracy of vendor shipments
� Tracking vendor compliance with EDI and floor ready requirements including:
• ASN [856] – utilization and accuracy
• GS1-128 Carton Labels
• POS ticketing
• Hanger requirements
This data allows us to insure goods hit our sales floor as planned.
May 21, 2013 Page 5
Who is Pep Boys?
May 21, 2013
�745+ locations located in 35 states and Puerto Rico
�$2.0+ Billion in Revenues
�Ecommerce enabled – ship to store & ship to home
�Online service appointment capable through e-SERVE
Leading Automotive aftermarket retail and service chain comprised of 3 major lines of business; Service, Retail and Commercial (B2B)
Page 6
5/29/2013
2
Industry Perspective – What Retailers are saying…
May 21, 2013
�Concerned about margin risk they can control both directly and indirectly
�Want the Right Product, the Right Quantity at the Right Time.
�Most Vendor Requirements Documents Include:
� Statements and Rules addressing On-Time and Complete
� Focus on eliminating or reducing problem shipments
� Importance of accurate ASNs and Invoices
� Reducing value-added tasks in the DC
�Perfecting Omni-Channel Initiatives
�Concerned about Out of Stocks situations
The Perfect Order Index – Good place to start�On-Time
�Complete
�Damage Free
�Accurate Documentation
�Received On-Time at DC
�Unit Fill Rate
�Trouble Free
�Accurate ASN
Perfect Order Index Study – 2008 Whitepaper
May 21, 2013 Page 8
%
Damage
Free*
% Correct Docs
(ASN)POI
Units Lines Orders Units Lines Orders Unit Order
Average of Sample 60.7% 41.7% 51.1% 90.5% 76.2% 59.9% 100.0% 88.8% 27.2%
Best Practice Average for Sample
(Avg of the top 20%)79.2% 71.3% 76.7% 96.2% 80.6% 87.5% 100.0% 99.4% 66.8%