PLANNING FORECASTING & PROCESS OPTIMISATION
Caleb Nicolson – General Manager Group Supply Chain
Agenda
• Kathmandu introduction
• The challenge of growth for our Supply Chain
• Our Microsoft AX Decision and Project
• What does it mean for our Supply Chain capability?
Kathmandu – Travel and Adventure Brand
• Kathmandu is a leading specialist in quality clothing and equipment for travel and adventure.
• Our aim “to inspire adventure in everyone”
• We are serious about our product design and quality
Kathmandu has a strong history of growth
245.8
306.1 347.1
384.0 392.9
FY10 FY11 FY12 FY13 FY14
Agenda
• Kathmandu introduction
• The challenge of growth for our Supply Chain
• Our Microsoft AX Decision and Project
• What does it mean for our Supply Chain capability?
The supply chain challenge - ~ 75% growth in 5 years
• 69 new stores
• Store Assortments and Traiting
• New channels - online and market places
• Increased range, throughput and stock holdings
• Distribution Centre capacity and capability
• Increased services levels
Developing our supply network to match demands
• Designed and built new Distribution Centre in
Christchurch, New Zealand
• Expanded Australia National DC by 60%
• Implemented 3PL’s in NZ, AU and UK
• Increased supply chain activity at origin
• Designed and building our new Distribution Centre
in Melbourne, Australia
Managing Inventory across our retail network was
an increasingly difficult challenge
What did our Supply Chain need to deliver?
Business Strategy
• Growth Strategies
• New Store Rollout
• Optimise Existing Network
• Online & Digital
• Enhance Product Offering
• Summit Club Loyalty
• ANZ promotional model
• Vertical operating model
• UK / International Expansion
Supply Chain Strategic Response • Build a responsive supply chain with high service levels
• Balance “Lean vs Agile” principals.
• Optimise our retail network
• Build our systems, process and people capability to deliver “best in class” in an omni-channel environment
• Regionally, our capabilities need to match the business position and maturity stage.
• Build capability to support an expanding global business
• Develop our people
• Reduce total cost of supply chain “Source to Shelf”, in particular deliver value to our retail network
Agenda
• Kathmandu introduction
• The challenge of growth for our Supply Chain
• Our Microsoft AX Decision and Project
• What does it mean for our Supply Chain capability?
The business challenge
• Increasing requirements for real time information,
improved customer information and experiences, Social media, loyalty, in-store technology and …..
• Team / functional siloes by technology
• Limited stability and scalability
• Current partners were not big enough or vertical retail
capable
• Platform will not support achieving Kathmandu’s business
strategy of growth, entering new markets and improving customer experience
The decision - Microsoft AX
•
An end to end solution
•
A commitment to the retail vertical
•
A roadmap for the future
•
The ability to work with leading partners
•
Scalability
•
Fit our business
Our approach to this programme of work
•
Our AX project was delivered in 3 phases over 2 years;
1. CRM, PIM, Just Enough (Assortment and Purchase Planning)
2. Point of Sale
3. Financials, Inventory, Warehousing, Just Enough (allocations and
replenishment)
•
Large programme of work;
– Lead by internal Project Management Office in IT
– All functions with largely dedicated SME’s
– High quality partners critical; Sable, Blue Horseshoe, Just Enough
•
Final phase “Live” in Oct 2014
Kathmandu won an award at Microsoft’s Annual
conference in the USA
• 2015 Visionary Award.
• Designed to recognize customers who have achieved new levels of excellence with their Microsoft technology
• Great acknowledgement of our achievement for the team
Agenda
• Kathmandu introduction
• The challenge of growth for our Supply Chain
• Our Microsoft AX Decision and Project
• What does it mean for our Supply Chain capability?
Core Supply Chain Systems
Our investment in the AX programme has delivered
a “Supply Chain System Transformation”
POS
• Sell
• Price
• CRM / Summit
Assortment & Item Planning AP / IT • Range Planning • Stock / Financial Planning • Purchase Planning LIMA Supplier Portal • PO mgmt with vendors • Shipment mgmt with freight forwarders Purchase orders Purchase orders Demand Planning • Allocations • Replenishment DC PLANNER IN AX • Releases orders to the DC
Sales & Stock / Replen demand Push Demand Total Demands / Todays work Warehousing • Receipt • Store • Despatch Demand / ASN Receipt DC PLANNER Demand ASN Receipt
Just Enough in Kathmandu
Price & Markdown Planning Promotion Management Profiling Inventory Planning Replenishment Demand Forecasting Assortment & Space Planning Allocation Merchandise Financial PlanningManaging Inventory across our retail network with
Just Enough
Just Enough has transformed the way we manage inventory by store
WAS
- Country centric management
- Product performance managed across market - Excel Decision Support Tool
- Demand generated by ERP engine overnight
NOW
- One view of demand across business
- Presentation stock planned and executed consistently
- Classifications and policies drive our system outputs - Product and Store performance managed daily - Best in Class Allocations & Replenishment System
"Top 100" 25% of GM$ (Approx 400 SKU) "80/20 - Excl Top 100" ~50% of GM$
(Approx 1,800 SKU, Excludes Top 100)
"Non 80/20"
~25% of GM$
(Remainder of CURRENT range approx 2,900 SKU)
"Top 100" 25% of GM$ (Approx 400 SKU) "80/20 - Excl Top 100" ~50% of GM$
(Approx 1,800 SKU, Excludes Top 100)
"Non 80/20"
~25% of GM$
(Remainder of CURRENT range approx 2,900 SKU) "Top 100" 25% of GM$ (Approx 400 SKU) "80/20 - Excl Top 100" ~50% of GM$
(Approx 1,800 SKU, Excludes Top 100)
"Non 80/20"
~25% of GM$
(Remainder of CURRENT range approx 2,900 SKU) "Top 100" 25% of GM$ (Approx 400 SKU) "80/20 - Excl Top 100" ~50% of GM$
(Approx 1,800 SKU, Excludes Top 100)
"Non 80/20"
~25% of GM$
(Remainder of CURRENT range approx 2,900 SKU) "Top 100" 25% of GM$ (Approx 400 SKU) "80/20 - Excl Top 100" ~50% of GM$
(Approx 1,800 SKU, Excludes Top 100)
"Non 80/20"
~25% of GM$
(Remainder of CURRENT range approx 2,900 SKU) "Top 100" 25% of GM$ (Approx 400 SKU) "80/20 - Excl Top 100" ~50% of GM$
(Approx 1,800 SKU, Excludes Top 100)
"Non 80/20"
~25% of GM$
(Remainder of CURRENT range approx 2,900 SKU) "Top 100" 25% ofGM$ (Approx 400 SKU) "80/20 - Excl Top 100" ~50% of GM$
(Approx 1,800 SKU, Excludes Top 100)
"Non 80/20"
~25% of GM$
Agenda
• Kathmandu introduction
• The challenge of growth for our Supply Chain
• Our Microsoft AX Decision and Project
• What does it mean for our Supply Chain capability?
Our view of Omni–channel - “a seamless experience
for the customer across multiple channels”
key elements include;
• Multiple shopping avenues, i.e.. mobile, web, store, customer service centre
• Convenience of product availability, and delivery to store or home
• Consistency of service level whether in store or online
• Generally consistent pricing, with some capability for online only/store specials
• A consistent Brand experience, i.e.. tone and manner, look and feel of the Brand
