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DHL Supply Chain Solution • Designed new supply chain to maximize flexibility and efficiency• Established centralized distribution center with managed, secure
transportation (one-stop-shop)• Established inventory management system• Reverse logistics process • Seamlessly integrated end-to-end supply chain solution
Customer Challenge• Ensure the company merchandise is available to affluent consumers in
Mexico at the same time they are available in other global markets• Improve service to growing luxury retail customers in Mexico• Increase market penetration throughout Mexico
CUSTOMER CHALLENGEOperating in Mexico for 20 years, the company manages 200 stores with a distribution network comprised of cross-dock operations re-distributing product from Germany. As its customer base grew, however, this distribution model was insufficient for keeping the right mix of in-season merchandise in stock when customers wanted it. This challenged the company’s goal of being able to offer the same merchandise at the same time to its luxury fashion customers worldwide. It also needed consistent, high-quality product tagging and packaging in keeping with its brand image.
Additionally, the company needed to ensure shipments from Germany to Mexico were efficient and reliable. Once at the port and during transport in Mexico, products required protection from security risks and administrative delays that could disrupt product availability to stores and consumers. The company needed streamlined processes to ensure delivery to multiple locations in Mexico without service disruptions resulting from security breaches or handoffs between multiple local transportation providers.
World renowned apparel manufacturer has served the luxury market for almost 90 years. The company operates in more than 124 countries and offers its high-end fashions through more than 6,100 points of sale, including its own stores. With a growing market for luxury goods throughout Mexico, the company needed to offer the same seasonal collections in the country as it did in upscale markets in North America and Europe. The global retailer partnered with DHL Supply Chain in Mexico to design and pilot a new supply chain solution that would deliver the quality and service its brand demanded, in the process enabling it to expand its business in Mexico.
CONSISTENT, RELIABLE, SECURE SUPPLY CHAIN SUPPORTS LUXURY FASHION RETAILER EXPANSION IN MEXICO
Customer Benefits• Improved product availability• Successful Mexico operation is base for regional expansion• Reduced time for product replenishment • Reduced time to replicate product offering in major global cities at
start of new season
Retail
“ We understand the fashion industry requires leading edge warehousing and distribution operations, employing robust security systems and impeccable merchandise handling. The usage of a third-party logistics partner increases flexibility, security and total inventory control, while shifting administrative responsibilities to the provider.”
– Eduardo Tapia, Retail Operations Director, DHL Supply Chain
Overall, the customer’s strategic objective was to increase sales and market penetration in Mexico. Achieving this objective required a more flexible, efficient and secure supply chain solution.
DHL SUPPLY CHAIN SOLUTIONAchieving a high degree of supply chain sophistication meant the fashion power house would need to partner with an established, reputable global third party logistics provider (3PL) with Mexico expertise to develop and implement the right solution. Although the company briefly ventured into outsourcing with cross-docking operations, it had never partnered with a 3PL for a complete overhaul of its operations. The global retailer was aware that DHL Supply Chain had global expertise in the fashion industry and approached the 3PL with its challenge.
After visiting the company’s distribution operations in another country, the DHL Supply Chain team designed a central distribution center in the State of Mexico. The facility, which supports the retailer distribution throughout Mexico, has a state-of-the-art inventory control system, and provides on-site value-added services such as customized labeling and packaging. The dedicated facility is more efficient and closer to retail customers, so the correct merchandise is in stock and can be replenished quickly during peak demand. Deliveries also are more secure and reliable because one provider manages the transportation in addition to the warehousing. DHL also manages reverse logistics at the end of a collection or season.
By partnering with DHL, the company also benefits from a seamless integrated solution that includes services from DHL sister organizations DHL Global Forwarding and DHL Express. Global Forwarding ships inventory from its origin in Germany into Mexico, and Express manages some parcel shipments from the distribution center to individual stores.
CUSTOMER BENEFITS DHL’s dedicated, end-to-end supply chain solution makes the goods available to Mexican consumers at the same time they are available in New York, London, Paris and other upscale markets. The attention to detail inherent in the fashion logistics solution ensures premium products arrive in stores in the beautiful condition expected of the company brand.
“DHL Supply Chain understands the quality and service requirements of the high-end fashion industry, and we know how to operate securely and effectively in Latin America,” said Eduardo Tapia, retail operations director, DHL Supply Chain. “We get products to retail customers on time and in great condition so our customer does not risk losing business.”
The integrated supply chain solution provides:• A highly flexible, consistent and reliable supply chain
that gets products to market faster• Enhanced security and efficient inventory management • Better customer service, including fast replenishment
and retailer-specific packaging• Assurance that its premium goods will arrive in stores
in beautiful condition• Improved ability to deliver multiple collections or
seasons to stores in Mexico at the same time they are delivered to major luxury markets in the U.S. and Europe
When fashion companies strive to increase market penetration and flexibility, it is imperative to have a supply chain that can ensure quality, efficiency and exceptional service. Call the experts at DHL Supply Chain today to learn how we can help you grow your apparel business.
For further information
Contact our experts:[email protected]/supplychain
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