INVENTORY

Sur La Table Boosts Operational Efficiency

BY Marianne Wilson

A switch to a PC-based warehouse management system has provided kitchen goods retailer Sur La Table with significant operational efficiencies by allowing the company to merge two inventories into one single inventory process. The chain’s new supply chain execution system has yielded accuracy improvement of 99.53%, a 20% increase in space utilization, and monthly reductions of $5,000 in energy costs and $2,000 in lift equipment rental fees.

“The old system dated back to the late ’80s, early ’90s and ran on an AS400-based system that lacked RF or handheld technology,” said Tom Rafferty, distribution center manager, Sur La Table, Seattle, which expects to end 2010 with 82 stores. “We were picking orders off of paper pick sheets. None of the inventory transactions—such as put-away and replenishment—were in real time. When we shipped to an individual store, all we knew was that we had ‘X’ amount of units on so many pallets. We didn’t have any information that was specific to the pallet, let alone to the carton.”

Sur La Table runs all the distribution from its warehouse in Brownsburg, Ind. The facility supplies the company’s brick-and-mortar stores, and direct-to-customer e-commerce and catalog fulfillment.

Concerned about improving productivity and efficiency as the company expanded, Rafferty and his team started aggressively seeking a modern warehouse management system. After reviewing the options, they chose Warehouse Librarian (from Snoqualmie, Wash.-based Intek Integration Technologies). The scalable, PC-based supply chain execution and warehouse control system featured the total cost of ownership of a mid-range system but the functionality of bigger systems.

“One of the draws for us was that buying Warehouse Librarian was like buying Excel,” Rafferty said. “You purchase it off-the-shelf, and you could use it right away without any heavy modification.”

Sur La Table went “live” with the new system in July 2008. It was a fast and easy transition. By the end of the first week, it had completed all business slated for the period.

Operating on a network of Windows-based PCs, the system was integrated with 75 Symbol RF handheld scanners and five internally designed mobile carts—essentially PCs on wheels.

With the integration of the new system, Sur La Table no longer had to run two parallel inventories.

“Merging our inventories was huge in terms of productivity gains,” Rafferty said. “We used to transfer goods back and forth. Now, since we’re picking both ‘live’ from the same slot, we can make inventory immediately available to both the retail store and the direct customer channels. In conjunction with our host system, we can reserve product for the direct customer, so that we don’t completely deplete it while fulfilling retail demand. As a result, we’ve gotten about an 18% improvement on a cost-per-unit basis.”

Gains from merging the two inventories also extended to space utilization.

“One of the biggest improvements came from the way we utilize slots,” Rafferty explained. “We were 20% busier through the peak period in 2009, and we did this with the same footprint as last year before we got the new system.”

There also have been some hard dollar savings. With the implementation of the new system, the chain needs to rent fewer lifts to get through its peak period.

“Over a six-month period of time, we saved $12,000 in forklift rental costs,” Rafferty said.

Previously, Sur La Table typically ran three shifts, 24 hours a day, five days a week, all year long. But now, during non-peak periods, the building is only open for 12 hours a day, five days a week, which has led to a $60,000 drop in utility costs.

The stores also get much better information from the DC.

“Each pallet has its own barcode ID, and each carton on the pallet has a barcode ID that links it to the pallet,” Rafferty said. “Each store gets a manifest with every shipment, so they know what’s on each pallet.”

Modular in nature, the system will help Sur La Table, which plans 10 to 15 new stores in 2011, meet its needs moving forward.

“As the business grows, we can add more RF units and more users to what we’ve already got,” Rafferty said.

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Kmart launches Smart Sense

BY CSA STAFF

HOFFMAN ESTATES, Ill. – Kmart announced the expansion of its brand portfolio with the introduction of the Smart Sense line, its new Kmart brand that includes a wide range of items including everything from snacks and beverages, to oral care, paper products, household cleaners and over-the-counter medications. The quality of the Smart Sense line is comparable to that of national name brands, and on average costs 20% less, according to the company.

"With the introduction of the Smart Sense line, Kmart is looking to offer a more affordable Kmart brand product assortment that will rival the quality of more nationally recognized brands," said Mark Snyder, chief marketing officer, Kmart. "While the Smart Sense line will offer the everyday essentials, Kmart is also taking it a step further by providing unique products that you wouldn’t typically expect to see under a store brand."

The Smart Sense line currently consists of hundreds of products available in Kmart stores and the product line will expand to more than 1,200 items by early 2011, the company reported. Kmart said it will also support the Smart Sense line launch through multiple communications channels, including advertising, coupon offers, merchandising displays, sampling, digital marketing and event marketing.

In addition to the introduction of the Smart Sense line, a new look has been created for many other Kmart brand products, the company reported. The brighter and more vibrant packaging has been designed to capture the "colorful thinking" Kmart is demonstrating through its new product and brand announcements. In addition to the Smart Sense line roll-out, Kmart is also introducing products in a re-launch of its other exclusive brands, which include, Little Ones baby care products, Champion Breed pet care products, Image Essentials personal care products and VitaSmart vitamin products.

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Target to open ten stores on 10/10/10

BY CSA STAFF

MINNEAPOLIS Target announced that it will open 10 stores across the country, resulting in the creation of more than 2,400 jobs.

The stores will open in the following communities:

 

    * Sacramento East: 6507 4th Ave., Sacramento, Calif.     * Simi Valley West: 51 Tierra Rejada Rd., Simi Valley, Calif.     * Bakersfield Central: 2901 Ming Ave., Bakersfield, Calif.     * San Jose North: 95 Holger Way, San Jose, Calif.     * Azusa: 809 Azusa Ave., Azusa, Calif.     * Salt Lake City: 1110 S. 300 West, Salt Lake City, Utah     * Little Rock University: 420 S. University Ave., Little Rock, Ark.     * Christiana: 800 Christiana Mall, Christiana, Del.     * Flushing: 4024 College Point Blvd., Flushing, N.Y.     * Braintree: 250 Granite St., Braintree, Mass.

 

“These new Target store openings will help support local economies and make life easier for our guests by creating new jobs, spurring development and providing the utmost in convenience and value,” said John Griffith, EVP property development for Target. “We are looking forward to deepening our relationship with guests in communities across the country.”

As part of the grand opening celebrations, Target said each store will contribute to its community by initiating a local grant program, contributing to the United Way, donating food to Feeding America and product to the local Goodwill chapter and encouraging team members to volunteer their time to serve their community.

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