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TRANSCRIPT
Contents Summary
3. Introduction
4. Major pains of retail supply chains
6. Limitations of current sourcing management
8. Effective sourcing management & automation
10. CBX Retail Supply Chain Automation
11. Case Study: Grupo Cortefiel finds vision
12. Summary & About CBX Software
Today’s retail sourcing environment is increasingly
complex, where multiple functions, processes and
suppliers in different countries must collaborate like a
virtual orchestra to produce products within short lead
times. Failure to get the right product mix in front of
the increasingly fickle consumer could mean failure of
a product, brand or company. Best strategic sourcing
software tools help retailers get products to market on time
through expanded visibility into critical issues which might
impact the product lifecycle. This white paper addresses
common issues that global retailers face in their supply
chains, providing an overview of how Retail Supply Chain
Management software (SCM), Retail Sourcing and retail
product lifecycle management solutions (retail PLM
solutions) can relieve supply chain bottlenecks.
Introduction
In today’s competitive retail industry bankruptcies and
store closures dominate the daily news, retailers and
brands face a myriad of pains and issues just to survive.
To maintain their margins and competitiveness and ensure
survival, retailers rely on strategies such as sourcing direct
from suppliers and increasing their sourcing and private
label programs.
Retail supply chains are incredibly complex, with multiple
steps, processes and milestones involved from a product
concept or planning stage to the point of product delivery
and sale to the customer. In order for new competitive
strategies to work, retailers need to ensure that their
supply chains are fully optimized with built in visibility,
collaboration and efficiency. As the number of private label
sku’s sourced increases, numerous functional areas in
different countries need to collaborate and plan to respond
to change effectively.
If communication and collaboration is ineffective,
bottlenecks occur, production and delivery dates are
missed, margins are squeezed, consumers look elsewhere
and the bottom line takes a hit. Often production delays
are the result of not being able to automatically connect
information from a multitude of different supplier processes
quickly, and accurately. Information required through the
retail product lifecycle (Retail PLM) comes from different
sources including spreadsheets, emails and third party
disparate systems and there is often no automatic way to
overlay this information into one clear view.
Supply chain visibility is the number one agenda item for 45% of leading global enterprises The Supply Chain Agenda - Cap Gemini Consulting
Major Pains of Retail Supply Chains
Retailers today face many issues that include supplier compliance,
order quantity and timing product delivery through their supply chain.
These issues are mostly related to operational efficiency and the ability
to respond to retail market trends faster.
Demanding market
Whereas in the past retailers could get away with only a few new
assortments per season, today they might rotate stock every few
weeks. Consumers are increasingly demanding and trends change
fast, so staying competitive means ways to quickly match demand. In
most cases consumers want a mix of variety, fashion and quality
along with a socially responsible products at cost-effective prices.
Successful global retailers understand this and are able to respond to
these demands effectively through sourcing management tools,
short product lifecycles and a strong sense of consumer demands.
Murky vision
As supply chains grow in complexity with increased assortments,
processes and links in the chain, information visibility becomes critical.
Unfortunately it also becomes more difficult as multiple versions of
documents such as product trackers, cost sheets, sample trackers and
supplier scorecards are created in different formats. Problems occur
when information is not centralized or there are inadequate ways to
share information. The result of such information gaps is a lack of total
sourcing management awareness into potential supply chain problems
and an inability to provide early warnings and synchronize real time
responsiveness.
Manual processes
Given the complexity in today’s supply chains where multiple internal
departments and third parties are involved, the reality is that each link
in the chain might have their own information management processes
which are not linked to the broader supply chain. These processes
are often not automated and might involve a separate ERP system,
spreadsheets, PDF’s and communication such as phone calls and
emails. Sharing and updating information is often done manually,
resulting in delays and errors in information sharing. These processes
are often cumbersome and don’t easily scale when private label
assortments need to grow.
According to a
recent study on
PLM trends, 54%
of respondents
expressed a desire
to have supply
chain and sourcing
features integrated
within their retail
PLM solution for
complete end-to-
end private label
management.
Pressure points
As retailers struggle to maintain margins and meet market
demands, the pressure on supply chains has increased
requiring leaner inventory and more efficient processes.
These pressures include demands for stronger retail
sourcing, lower cost raw materials, relying on higher
quality suppliers, producing and shipping products faster
and just-in-time with shorter lead times and managing
a longer list of KPI’s to ensure quality, compliance and
supplier performance.
This diagram illustrates current ways retailers manage the
complexity of retail production workflow, using multiple tools.
Complex needs
One of the challenges that both hard and soft goods
retailers are facing is how to manage their unique and
complex product workflow needs across multiple product
lines. Retailers with large product variety and volume
typically rely on workflow process tools referred to as
calendar management or critical path management to
manage their various product flows. These tools provide a
way to connect processes together which are organized
and enable full visibility.
Limitations of Current Sourcing Management Existing product workflow and sourcing management tools, such as spreadsheets, product trackers and/or weekly roll-up
meetings, are often times manually intensive, time consuming and do not have features such as On-line collaboration
and search friendly threaded messaging. Below are some common issues with existing retail sourcing and supply chain
management practices.
Spreadsheet silos
In most cases companies still rely on spreadsheets which are excellent tools in themselves, but are
limited in their ability to serve as a product lifecycle management or supply chain management tools.
Spreadsheets are usually held in different locations by different users and updates are not automatically
shared, which means there are often multiple versions of the truth. Other tools such as Microsoft Project
or Access are also used, but don’t enable complete information roll-up and integration.
Information consolidation
Large organizations have many departments and processes and most current sourcing management
methods are not able to automatically roll-up the disparate order related information into one
view. Data comes from different places, internal and external. Retailers with a large private label
assortments for example are rarely able to consolidate information from same suppliers across the
entire collection or brand.
Calendar conflicts
With global retail sourcing, different teams operate under their own calendars which mean different
holidays, working hours and schedules. This opens great potential for conflicts which are not addressed
in most sourcing management tools. This is further complicated by different time zones and regulations
which might impact the flow between different markets.
Resource planning
Efficient planning and allocation for the appropriate use of resources is critical for today’s retail supply
chains. This requires an ability to identify bottlenecks and quickly shift resources when more or less
intensity of effort is required. Since current retail sourcing practices are not able to automatically
consolidate information centrally, it is difficult to effectively reallocate resources in the case of a critical
event or emergency.
Decision support
Effective supply chains enable decision making that is less reactive and more responsive. Such tools
should be able to model scenarios and recommend solutions to address problems. For example if
samples were signed off late, this would impact the delivery date. Most existing sourcing management
methods are not able to roll up the data to enable responsive decision making.
The biggest challenge that
spreadsheets present is
versioning control. With multiple
versions of a schedule passed
around, it’s often unclear who
owns the master version, or
which one should be used at any
given point. If a deadline is
missed, there’s no automatic
representation of that missed
data on the affected downstream
processes.
Janet Suleski, Research Director at Gartner Research
Effective Retail Sourcing Management & Automation
What is Sourcing Automation?
Sourcing automation as a critical path manager is a technique developed by DuPont in the 1950’s. Sourcing automation
links the customer with its suppliers and automates shared responsibilities and information sharing. This automation
ultimately maps out the duration and path of planned activities to the end of the project, activity can start and finish without
extending the project timeline.
What is Retail Sourcing and Supply Chain Automation?
Supply chain automation manages the entire retail private label product from concept to delivery through innovative
retail product lifecycle management (retail PLM). It incorporates information from the planning, product development,
sourcing, production and logistics stages into a complete view in real-time, enabling a responsive supply chain. Through
sourcing automation, supplier management and data collection, sourcing management tools are able to view personalized
dashboards which roll up data by department, supplier, project or season. These retail sourcing tools provide color coded
indicators which suggest areas that require various levels of action.
How can Retail PLM Help You?
Effective retail PLM tools provide real time visibility into retail sourcing and supply chain functions, allow planning of
tasks and shifting of resources, identifying due dates and milestones and pinpointing the areas where attention is
required. In best practice retailers, retail PLM does this across multiple individual private label products, lines, brands and
divisions. Ultimately retail PLM allows managers to move beyond day-to-day reactive management into a more strategic
management role aligned with more strategic business objectives.
The following view illustrates how a total sourcing management dashboard might look, indicating varying
issues that require attention within the supply chain.
Specific benefits of Retail Sourcing Automation
Choreographs the flow of the end-to-end product
lifecycle
Removes information silos and providesvisibility
into critical issues
Consolidates information, mitigates risk through
early warning
Enables management by exception
Ensures global calendars areautomatically
synched across teams
Manages resources to prevent bottlenecks and
ensures success
Provides business intelligence enabling better
decision making
Automates processes and choreographs
workflows
Keeps all supply chain stakeholders on
schedule
Supports collaboration and updates changes to
all parties involved
Improves KPI’s in the supply chain
Improves product cycle times
Saves time spent on weekly roll-up meetings
Reduces errors, inaccuracies and inefficacies in
the supply chain
What to Look for in a Retail Sourcing Solution?
Configurable -The system should be flexible to enable customization for particular user needs.
Alerts - Should be generated automatically through the system, by email or SMS and sent directly to the
appropriate person for follow up.
To -Do lists - The ability to proactively plan work that needs to be completed in time to ensure a products critical
path is management. This should seamlessly integrate with a user’s dashboard and offer the user a tailored view of
the activities they need to complete.
Automatic roll-up of information - At any time the system should be able to report the entire status of a product
or project in a report or dashboard.
Analytical capability - Users of the system should be able to drilldown into particular issues and adjust and
optimize a products critical path based on their learning.
Planning functions - The tool should allow tasks and resources to be shifted and adjusted based on requirements
of the product or project.
Intuitive interface – The user should be able to quickly and easily learn and adopt the system, as easy as if it were
a Microsoft Office program.
Web based – The system should be easily accessible with a range of internet speeds, browsers and levels of IT
sophistication
CBX Retail Supply Chain Automation CBX Total Sourcing Management is a retail industry workflow process solution that can manage the entire sourcing
process from concept to payment. CBX has infused retail PLM with retail sourcing to deliver supply chain automation
based on over 20 years of working experience with multiple retailers. No current tool on the market has the functionality
and capability offered by the CBX Total Sourcing Management platform.
Customized Dashboards
CBX provides an easy to use, color coded dashboard
that provides user specific alerts, notifications, and
exception based reporting for critical milestone tasks.
These dashboards roll-up information automatically saving
time bringing teams up to speed and are managed and
checked off in a single location.
Alerting Function
Overdue tasks or activities are flagged by an alert in
the dashboard. Email alerts can also be automatically
triggered in the system and sent to the relevant users or
department for resolution.
Analytical Drilldown
Detailed analysis can be performed to assess tasks and
activities to indicate and dig into problem areas. Patterns
can be identified and modifications to the process can
easily be made.
Actual and Planned Tasks
The tool provides clear visibility into actual and planned
task dates, providing the option to adjust production dates
and schedules as required. To do lists are created based
on tasks that need to be completed in order to maintain the
critical path.
Proactive Planning
Provides a project plan for each item and range of items
and provides capability to plan and adjust planning
throughout the product lifecycle.
Intuitive Interface
The CBX interface is similar in look and feel to a standard
Microsoft Office product such as Outlook and Excel which
makes it easy to use and adopt.
Web based
CBX can be accessed with a web browser and standard
internet speed. User can log in to a user specific interface
which is intuitive to understand.
Easy Updates
Allows milestone/task to be easily updated by internal
users, suppliers, partners, or linked to external systems
enabling data to flow accurately to update legacy systems.
Any tasks performed within CBX are automatically
integrated with all internal systems.
A more efficient workflow for retail PLM, including retail
sourcing and supply chain management.
Case Study: Grupo Cortefiel finds its vision
Background
Grupo Cortefiel is one of Europe’s top fashion chain retailers operating the Cortefiel, Pedro del Hierro, Springfield and
Women’ Secret brands and Fifty Factory, a chain of outlet stores. With a central administration and a network of logistics
centers in Madrid, the company has international buying offices in Spain, Hong Kong and India. Founded in Madrid in
1880, today Cortefiel operates in 64 countries, with over 1,700 points of sale an online catalog and over U.S. $2 billion in
sales. Major competitors include Inditex (Zara) and Mango.
Challenge
Prior to implementing CBX Total Sourcing Management, Grupo Cortefiel had no systems to manage their workflow.
Critical supplier information was held in different places and each department, such as women’s, men’s and intimate wear,
worked with spreadsheets and followed separate workflows. Management of supplier agreements was not well organized
and Cortefiel needed a way to automatically bring new suppliers onboard. There was no way of seeing the entire retail
sourcing process which made the management and tracking of the thousands of styles, orders and shipments extremely
complex.
Solution
Grupo Cortefiel decided to implement an integrated supply chain automation tool to handle supplier management, order
tracking, and quality management. The system is able to homogenize planning, design, sourcing, and order functions.
The CBX platform was chosen since it had out of the box modules which could manage all of Cortefiel’s specific supplier,
sourcing, order and quality needs in addition to providing full visibility into their entire supply chain. CBX was easily
adaptable to Cortefiel’s existing system and the intuitive interface allowed users to quickly adopt the web based tool. The
system provided Cortefiel with advanced forecasting, planning and alerts of potential risks, along with robust analytical
capabilities.
Result
CBX provided Cortefiel with end-to-end retail PLM including retail sourcing and supply chain visibility from the concept
to the delivery stage, allowing Cortefiel to cut a significant amount of days out of their supply chain. Various Cortefiel
departments were given the ability to forecast seasonal buying and sourcing plans and assign tasks to relevant teams.
Full visibility into the sourcing progress was achieved as well as the ability to manage technical style specifications,
supplier management was much improved with the platforms ability to report on work in progress status and capture
data from both internal and external users. As a result, Cortefiel’s merchandizing, production and other teams are more
informed and better able to response to the needs of their customers.
Summary
Total Sourcing Management is a forward thinking tool designed to help retailers navigate the complexity of today’s retail
sourcing environment. While it is currently used to some extent by retailers, the potential of retail sourcing and supply
chain, combined with retail PLM is only beginning to be utilized. It today’s difficult economic and retail climate, retailers
will continue to look for ways to optimize their operations and reduce costs. Increasingly they will turn to tools such as
sourcing management tools to enable automation, efficiency and savings.
About CBX Software
CBX Software is the world’s leading Total Sourcing Management solution provider from concept to delivery – combining
people, processes and solutions. CBX helps retailers and brands streamline product development and retail sourcing
all the way through order, production and delivery. Through innovative Sourcing Management, Product Life-cycle
Management (Retail PLM), and Production & Order Management technology solutions, CBX empowers the supply chain
network by driving collaboration to over 15,000 retail & supplier partners, and 30,000 users in more than 50 countries.
For more information, visit www.cbxsoftware.com.
Contact us
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CBX Software Headquarters
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909 Cheung Sha Wan Road,
Lai Chi Kok,
Hong Kong
+852.2378.6300
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San Diego,
California 92121
+1.858.925.7767
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London,
NW1 2FD,
United Kingdom
+44.20.8133.0328
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55/F Shun Hing Square,
Diwang Plaza
No. 5002 Shannon East Road,
Luohu District
China 518022
For more information please visit
www.cbxsoftware.com