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Vendor Performance Impact on Safety Stock Videocast

A detailed look at reducing vendor lead time and fill rate variance for lower inventories and improved cash flow.

For all the focus on supply chain management in the consumer goods to retail industry, there is simply not much solid understanding of exactly how vendor performance in such areas as fill rates and lead times – and more importantly the variances seen in those metrics – impacts overall and store inventory levels.

In this videocast, we use vendor performance information from a real retailer to show how reducing lead time and fill rate variance, achieved through targeted programs, can substantially reduce the amount of inventory a retailer needs to carry in its supply chain.

Featuring analysis of actual retailer vendor data, SCDigest editor Dan Gilmore, Mark Krupnik of Retalon, former retail supply chain executive David Schneider, and Richard Wilhjelm of Compliance Networks.

On-Demand Now!
Vendor Performance Videocasts Spring 2013

Videocast 1: The 13 Keys to Retail Vendor Performance Management Success: Realizing the Potential to Improve Fill Rates, Lead Times and Accuracy and Power the Bottom Line

On-Demand Now!

Gilmore will be supported in the discussion by Camille Fratanduono, Assistant Vice President, Pricing, Inventory Planning and Analysis at Pep Boys, and Greg Holder, CEO of Compliance Networks.

Videocast 2: Connecting Retail Vendor Performance with Improvements in Sales, Margins, and Inventory Supply Chain Digest and Dan Gilmore

On Demand Now!

In this outstanding broadcast, we tackle the impact of vendor performance on store service levels, inventories, safety stock, sales and margins from A to Z. Featuring Camille Fratanduono from auto parts retailer PepBoys, SCDigest's Dan Gilmore on “40 years of out-of-stock research,” Joe Shamir of ToolsGroup on the math of vendor variability and its impact on store service, and Greg Holder and Richard Wilhjelm of Compliance Networks. 
Compliance Networks now offers
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EDI for Small and Large Trading Partners

WebEDI (powered by DataTrans Solutions) provides customers with a simple and affordable way to  become EDI capable. Whether you are brand new to the EDI world or have years of experience, WebEDI provides an intuitive and powerful solution to address all of your EDI requirements.

More information.

Sign-up now to leverage the immediate EDI trading partner benefits of WebEDI. When prompted for a Trading Partner ID, enter: COMPLIANCE300
The Vendor Compliance Federation
presents their 2014 Annual Fall Conference, 11/2 to 11/5, 2014:  

I.C.E. in the Desert - Innovation. Collaboration. Execution.
JW Marriott Camelback Inn Scottsdale Resort & Spa
Scottsdale, Arizona

Join us for three days in Scottsdale, Arizona at the 2014 Annual Fall Conference! Don't be left in the cold - come to the desert! Register today for the go-to place for real collaboration. In the RVCF spirit of collaboration, retailers are committing to work with their suppliers, strengthening relationships, confronting issues and discussing initiatives.  

More information.

Register now!
Lean Freight Performance Via Timely Freight Post-Audits

Now, more than ever, retailers are facing uncertain profits in a perfect storm of a slow recovering economy combined with rising inbound costs. While all indicators point to an economic recovery, retailers must continue to explore all avenues of expense leverage in order to either grow or maintain profit performance. Specific challenges retailers face with their inbound  supply chain and overall profitability include:

1.       Rising diesel costs ( up $.32 over LY)
2.       Uncertain hour of services ruses, CSA
3.       High fuel and assessorial surcharges
4.       Driver shortages
5.       Board demands to document green initiatives
6.       Uncertain climate regulatory related issues related to the trucking industry ( i.e. weight and size limits)
7.       Tight labor resources related to supply chain activities
8.       Valuable transportation performance related data is buried in freight invoices

Download details here.
And We Can Make You Green, Too

The green benefits of Compliance Networks's solutions include improvements in transportation efficiency, reduction in carbon footprint, reduced fuel use, and improved supply chain compliance with green packaging initiatives, among other things. But, we are so proud of our internal recycling efforts, we just had to share the results.

According to Southern Shred, a document destruction and recycling firm, Compliance Networks's 2010 recycling efforts producing the following green results:

- 3,750 pounds of paper recycled
- 32 trees saved
- 13,125 gallons of water saved
- 6 cubic yards of landfill space saved 

For more on the green supply chain check out the Supply Chain Digest green newsletter.
Retail Supply Chain Special Reports

Compliance Networks is proud to partner with Stores Magazine and Integrated Solutions for Retailers to publish these informative, thoughtful, and helpful special reports:

From Integrated Solutions for Retailers:

2013 Retail Supply Chain Special Report

2012 Retail Supply Chain Special Report

2011 Retail Supply Chain Special Report

From Stores magazine, an NRF publication:

2013 20 Ideas Worth Stealing

2012 20 Ideas Worth Stealing

2011 20 Ideas Worth Stealing
A No-Cost Opportunity Assessment from Experienced Supply Chain Practitioners

We can help you handle these common retail challenges:
- Inbound shipments of the wrong items, at the wrong time, in the wrong quantity, and to the wrong location
- Inaccessible or inaccurate supply chain performance data
- Supplier performance not aligned with your retail objectives
- Limited IT resources or capital for addressing current system limitations and shortcomings 

We will benchmark your supply chain's performance:
- Against your competition
- Against your corporate goals and strategies!
- To discover where your supply chain is doing well and where it needs improvement.
- To identify lost opportunity costs!

Download details here.

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Improve Transportation Performance

Monitor Transportation Performance to Ensure On-Time Profits (and Deliveries)

By Richard Wilhjelm, VP Sales & Business Development, Compliance Networks, August 1, 2013 Source: SCDigest

The Importance and the Role Transportation Performance Plays in Mitigating Retail Margin Risk

In my previous article dated June 27, we discussed not only the importance of visualizing the purchase order lifecycle, but taking active steps to reduce the time between milestones to improve financial performance and reduce retail margin risk. In the fourth installment of our five part series, we will examine the importance of transportation performance and the role it plays in mitigating retail margin risk. In addition to financial performance, we will also discuss a bonus benefit of monitoring transportation that is sure to please your board, customers and other related stakeholders.

Transportation Performance Defined

How do we define transportation performance? Is it the answer defined in terms of speed? If that were the case, retailers would receive daily air shipments from the Far East with their merchandise. If you go to the Nashville Airport (BNA) you will witness a 747 arrive daily with shipments for Dell. But I know of few retail VPs of Transportation who have that type of budget. So is transportation performance defined in terms of the lowest cost? Hardly. As we have discussed in previous articles a retailer's financial performance is tied to the speed and execution of its supply chain. And consistently getting beat to the floor by five days by your closest competitor is certainly not a recipe for success. (That Is typically what you get with the lowest cost approach) I suggest that transportation performance is defined as financial balance between speed and cost layered with a component of predictability. Since most retailers have sophisticated Transportation Management Systems (TMS) to assist them in establishing the economic equilibrium between speed and cost, this article will focus on the necessity of measuring transportation as it improves predictability as well as reducing overall transportation costs.

Measuring Transportation Performance – Where Do We Start?

Simply put, your vendor expectation guide or routing guide is a great place to start. (I like to refer to the vendor expectations guide as the plan for mutual profitability but more on that later) While our next article deals with the importance of effectively communicating with your vendor partners, it is critical to note here the importance of setting the right expectation for your vendor partners up front. And once your requirements are in place, it's extremely important not to change them on an ongoing basis. Traditionally, some but not all, retailers are poor communicators of their of not only their initial requirements, but also make frequent changes to their requirements guide which makes it difficult for vendors to perform. Vendors are challenged with not only the number of retailers they serve, but also the number of vendor requirements changes retailers make during the course of the year. Creating a clear and consistent plan for your vendor partners and communicating their performance at regular intervals is the simplest way to achieve not only transportation performance, but overall supply chain performance.

What and How Often Do We Measure?

The answer, as always, depends on your strategy. Where do you fall along the cost versus speed continuum? Your transportation rules, your daily notifications and your vendor scorecards should all reflect that. While strategies will vary from retailer to retailer, some of the most common rules I see include:

- Failure to ship collect per TMS instructions

- More than two shipments in a week

- Routed carrier not used

- LTL shipments on consecutive days

- Shipped to wrong location

- Early and late shipments

How often should we measure these rules? Ideally we would like to capture these avoidable costs daily if resources and systems are available. By capturing these occurrences daily, we can feed this information back to our vendor partners to speed up the cycle of continuous improvement. But some of the information we are looking for isn't system generated and won't be discovered until the physical freight bill is received. For this I recommend a dual approach to capturing freight violations. On a daily basis we capture the system generated violations and feed this back to our vendor partners as quickly as possible to maintain our continuous improvement cycle. Then on a weekly basis, I recommend reviewing the physical freight bills to ensure they are in compliance with our vendor requirements guide. This dual approach will ensure a consistent and thorough view of our overall transportation performance.

Value

The never ending question to the supply chain professional is what is the value of this project versus the other 10 'high value' projects that currently reside on his or her desk today? The easy answer is money and its impact on the income statement, as a reduction in overall transportation costs will flow directly to the bottom line. TMS projects are often easier to approve than other projects for this reason alone. But there is much more value to be had here than a reduction in transportation costs. By tracking our transportation performance, we are adding milestones to our purchase order (PO) lifecycle we discussed in the previous article. Once we understand these and the other milestones along the purchase order lifecycle, the time between them and the bottlenecks that are increasing days in our supply chain we can then take active steps to eliminate them. While reducing our overall transportation expense is certainly desirable for the upcoming income statement, a larger savings will come from having a higher performing supply chain that continuously seeks to reduce our working capital requirements and mitigates margin risk. And beating our competitor to the floor by five days is not such a bad deal either!

Bonus Value

In addition to the value listed above, measuring transportation performance comes with a bonus value that retailers often don't consider, a reduction in their carbon footprint. Supply chain professionals are often at loss to articulate their sustainability strategy to their board members and customers. Leading retailers such as Wal Mart and Kohl's consider their sustainability efforts not only important for driving avoidable costs out of their operations, but also strategic to their brand. For retailers who have yet to articulate their sustainability efforts, measuring transportation performance is an extremely easy place to start.

Summary

Measuring transportation performance will not only yield next quarter benefits on the retailer's income statement, but also increase visibility to the PO Lifecycle which can be used to reduce long term working capital requirements. As a bonus, retailers can also begin to articulate a sustainability strategy through the reduction of their carbon footprint.

   

Page 13 of 48

Featured Customers

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“The Compliance Networks package is an 11 on a scale of 1-10”

Steve Lipton
SVP Finance
Elder-Beerman Stores Corporation
“We have learned a great deal about our vendors’ shipping habits and have used the information to make sound business decisions”

Jim Rawlins
SVP of Logistics
Bon Ton Stores Corporation

"Ahead of their time as far as supply chain management"

Darlene Hokanson
VP/CIO
Oshman's Sporting Goods, Inc.
"We have learned a great deal about our vendors' shipping habits and have used the information to make sound business decisions"

Jim Rawlins
SVP of Logistics
Bon Ton Stores Corporation

“rCMS improved the flow in our distribution centers by 62%”

Dave Sanford
VP of Distribution
Burlington Coat Factory
"They have an impressive ability to execute a solution and a deep knowledge of the retail industry."

Mike Prince
Former CIO
Burlington Coat Factory
"You can talk to these guys because they have lived it - they've been in the trenches. That is what sold us."

Jim Rawlins
SVP of Logistics
BonTon Stores Corporation
"Their reporting system gave us details that even our vendors were shocked we had"

Bruce Berger
Former Controller
Oshman's Sporting Goods
"It will create income for retailers, but more importantly, it will allow them to get the attention of their vendors and force them to deal with the problems non-compliance is causing retailers."

Dave Sanford
VP Distribution
Burlington Coat Factory
"Compliance Networks has proven the ability to completely capture our vendors' performance. They are extremely responsive; we have NEVER been able to get to this valuable information before."

Marc Elmo
Former VP Distribution and Transportation
West Coast Retailer
"Installation was unbelievably easy even though it was completely customized to Elder-Beerman's requirements."

Jim Rawlins
SVP of Logistics
Bon Ton Stores Corporation
"The rCMS is one stop shopping for Actionable Supply Chain Intelligence."

James R. Kelly
Director of Engineering
Dillard's, Inc.
"We were impressed with the competence and speed of completion they brought to the table."

Darlane Hokanson
VP/CIO
Oshman's Sporting Goods, Inc.
“In my 15 years at Burlington Coat Factory, dollar for dollar, rCMS is the best IT investment we have ever made.”

Mike Prince
Former CIO
Burlington Coat Factory
“We have learned a great deal about our vendors’ shipping habits and have used the information to make sound business decisions”

Jim Rawlins
SVP of Logistics
Bon Ton Stores Corporation
"...[CN] has really worked quickly and professionally to meet the project requirements...[they] are to be complemented on their technical expertise, professionalism and dedications to meeting BCF's requirements."

Liz Remine
Director System Implementation
Burlington Coat Factory

Associations and Partners

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Blue Jungle Marketing

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Vendor Compliance Federation

VCF is a leader in Retail and Vendor best practice solutions for supplier-retailer collaboration and is an advocate for retailer-supplier trading synchronization. VCF champions initiatives to increase strategic industry-wide productivity, profitability and growth.
Supply Chain Digest

Supply Chain Digest is the industry's most valuable supply chain management and logistics publication.
National Retail Federation

NRF's mission is to advance and protect the interests of the retail industry and to help retailers achieve excellence in all areas of their business.
Mainstream Technologies

Mainstream Technologies is a technology consulting firm specializing in custom software development, IT planning, service, support, co-location and hosting. We serve all types of organizations. We effectively address our clients' technology problems with world class solutions, regardless of computer language, operating system or brand of hardware.
Retail Industry Leaders Association

The Retail Industry Leaders Association is the trade association of the world’s largest and most successful retail companies, whose executives participate in RILA for its unique educational forums, its effective public policy advocacy, and its advancement of the retail industry.
Marketing Techniques and Innovations

Inez Blackburn is an independent consultant, educator and global trainer with a proven track record in helping companies maximizing performance by deploying a value proposition that will result in profitable growth.
Joe Lang Travel

Since 1993 Joe Lang Travel has offered "big business" corporate travel benefits and incentives for small to medium-sized business clients. 

Joe Lang Travel also offers its personalized, individualized service to couples, families, groups, honeymoons, destination weddings, and romantic getaways. 314-985-5642
DesignMatters

With over 20 years of design and media experience, DesignMatters continues to grow their footprint by supporting their number one priority: Their Clients. Fun, creative, customer-focused, and results-driven, DM creates custom Websites, videos, print design, interactive media, and more.
Supply Chain Markets

Vertmarkets - IT Group communities for retail, distribution, and manufacturing professionals
thegreensupplychain.com

A supply chain-centric website that aggregates current energy and environmental issues and topics that impact modern logistics practitioners.
Deeterwerks

Deeterwerks is focused on providing business development and program management solutions to the Retail, Manufacturing and Information Technology industries.
Integrated Solutions for Retailers

Vertmarkets - IT Group communities for retail, distribution, and manufacturing professionals
Supply Chain Digest

Supply Chain Digest is the industry's most valuable supply chain management and logistics publication.
David K. Schneider & Company

Proven boutique-sized provider of  innovative and practical supply chain solutions
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