Description
Supply chain executives in the apparel retail industry have been debating strategies for managing and integrating disparate ordertaking and fulfillment processes and operations. Operations managers are divided on whether a multi-channel distribution platform or a single distribution channel for handling order requests, regardless of how the order is placed, is the most operationally efficient and cost-effective answer.
Sponsored by:
Conducted by:
On behalf of:
Multi-Channel Distribution
in the Apparel Industry
®
®
2
SDI GROUP, USA
S
upply chain executives in the apparel retail industry have been
debating strategies for managing and integrating disparate order-
taking and fulfllment processes and operations. Operations
managers are divided on whether a multi-channel distribution
platform or a single distribution channel for handling order requests,
regardless of how the order is placed, is the most operationally effcient and
cost-effective answer.
SDI is delighted to present this white paper that details the results of a
survey of multi-channel distribution within the apparel industry. We hope
that you will fnd the results informative and insightful. The results clearly
show that multi-channel distribution is now mainstream within our industry. It
perhaps is of little comfort, but clearly our industry professionals are facing
a common challenge of how to manage multi-channel distribution within a
complex and rapidly evolving multi-sales channel environment.
To complement the results of the survey, SDI would like to briefy offer their
perspective of multi-channel distribution. Our perspective has formed
through witnessing the challenges our clients face and succeeding in
developing cost effective solutions to meet the demands of the multi-channel
environment. Only just a few years ago, the term multi-channel distribution
was rarely used among our clientele. Certainly many of our clients were
shipping through multiple channels, but often a channel, especially
e-commerce, was either handled through a 3rd party or as a purely manual
process tucked in a corner of the facility. Today, practically all of our clients
handle multiple channels of distribution and increasingly the trends are to:
1. Bring outsourced volumes back in-house.
2. Embrace the concept of performing multi-channel distribution within a
single facility.
3. Increase levels of automation.
We believe there are several factors driving these trends. Arguably the
catalyst is that volumes shipped through non-traditional channels have
grown signifcantly; it is now a matter of urgency that this fow is handled
effectively and effciently. In reaction to this growth, information systems have
developed and are now capable of handling multiple channels within the
same system often using the same inventory. Having a common inventory
provides great fexibility and responsiveness to sales demands from any
channel, while lowering inventory carrying costs. A common inventory
can help reduce shipping costs and traditional shipping methods can
be leveraged to facilitate, for-example, in-store pick-ups of merchandise
ordered on-line at a very minimal marginal cost of freight.
With a single facility and single information system, many physical fows can
be combined into common fows regardless of channel. With common fows
there is now greater movement to justify higher levels of automation, which
in turn can dramatically reduce labor costs; this is particularly important for
the very labor intensive ecommerce distribution channel. Similarly, with the
growth of non-traditional fows, there is greater volume to justify automation
of specifc tasks related to that channel, for example, automated packing for
e-commerce orders.
By using a single facility, a single material handling system can be designed
for all distribution channels and still meet service levels. Investment costs
can be much lower as the systems are shared, and often there are no
Multi-Channel Distribution in the Apparel Industry
“ Our growth increase is
difcult to fathom. We fnd
better ways to do things
every day. We have to
continue to evolve with the
industry.”
—Manager, Production;
Supply chain executives in the apparel retail industry have been debating strategies for managing and integrating disparate ordertaking and fulfillment processes and operations. Operations managers are divided on whether a multi-channel distribution platform or a single distribution channel for handling order requests, regardless of how the order is placed, is the most operationally efficient and cost-effective answer.
Sponsored by:
Conducted by:
On behalf of:
Multi-Channel Distribution
in the Apparel Industry
®
®
2
SDI GROUP, USA
S
upply chain executives in the apparel retail industry have been
debating strategies for managing and integrating disparate order-
taking and fulfllment processes and operations. Operations
managers are divided on whether a multi-channel distribution
platform or a single distribution channel for handling order requests,
regardless of how the order is placed, is the most operationally effcient and
cost-effective answer.
SDI is delighted to present this white paper that details the results of a
survey of multi-channel distribution within the apparel industry. We hope
that you will fnd the results informative and insightful. The results clearly
show that multi-channel distribution is now mainstream within our industry. It
perhaps is of little comfort, but clearly our industry professionals are facing
a common challenge of how to manage multi-channel distribution within a
complex and rapidly evolving multi-sales channel environment.
To complement the results of the survey, SDI would like to briefy offer their
perspective of multi-channel distribution. Our perspective has formed
through witnessing the challenges our clients face and succeeding in
developing cost effective solutions to meet the demands of the multi-channel
environment. Only just a few years ago, the term multi-channel distribution
was rarely used among our clientele. Certainly many of our clients were
shipping through multiple channels, but often a channel, especially
e-commerce, was either handled through a 3rd party or as a purely manual
process tucked in a corner of the facility. Today, practically all of our clients
handle multiple channels of distribution and increasingly the trends are to:
1. Bring outsourced volumes back in-house.
2. Embrace the concept of performing multi-channel distribution within a
single facility.
3. Increase levels of automation.
We believe there are several factors driving these trends. Arguably the
catalyst is that volumes shipped through non-traditional channels have
grown signifcantly; it is now a matter of urgency that this fow is handled
effectively and effciently. In reaction to this growth, information systems have
developed and are now capable of handling multiple channels within the
same system often using the same inventory. Having a common inventory
provides great fexibility and responsiveness to sales demands from any
channel, while lowering inventory carrying costs. A common inventory
can help reduce shipping costs and traditional shipping methods can
be leveraged to facilitate, for-example, in-store pick-ups of merchandise
ordered on-line at a very minimal marginal cost of freight.
With a single facility and single information system, many physical fows can
be combined into common fows regardless of channel. With common fows
there is now greater movement to justify higher levels of automation, which
in turn can dramatically reduce labor costs; this is particularly important for
the very labor intensive ecommerce distribution channel. Similarly, with the
growth of non-traditional fows, there is greater volume to justify automation
of specifc tasks related to that channel, for example, automated packing for
e-commerce orders.
By using a single facility, a single material handling system can be designed
for all distribution channels and still meet service levels. Investment costs
can be much lower as the systems are shared, and often there are no
Multi-Channel Distribution in the Apparel Industry
“ Our growth increase is
difcult to fathom. We fnd
better ways to do things
every day. We have to
continue to evolve with the
industry.”
—Manager, Production;