PowerPoint Presentation

Pantaloons Fashion and Retail Ltd.

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Competitive strategyValue for moneyConvenience - western retail format into the Indian context Availability Presence in many citiesWide range of products in one store multiple brandsKey drivers for achieving competitive strategyRetail locationVendor relationshipEffective and committed employeesCost effective operations

Supply chain strategyPantaloons and Future Supply Chains follow a supply chain format of moderate responsiveness.Consolidation of distribution centers to reduce warehousing costs. Increase efficiency of retail space and time by 80% floor ready merchandise.

Moderate responsiveness Moderate efficiency High supply chain surplusModerate to high efficiency using software applications like;ERPSambandh (Vendor Relationship Management) portal Warehouse management system (WMS)Auto Replenishment System (ARS)Advanced Transportation Management system (TMS)Put-to-light sortation system (PTL Sortation)Pick and Pack systemAutomatic Print and Apply system (Automatic Packaging system)Automatic online conveyor based weigh check system

Supply chain capabilitiesAbility to respond to wide ranges of quantity demandedAbility to meet short lead timesHandle a wide variety of productsHandle multiple suppliers (3000 +)Handle supply uncertaintyStrategic fit

India Factor: The focus is on high efficiency and low responsiveness during stable demand periods of each part of the country. Supply chain driversFacilityWarehouse and inventory - CDCBuilt in partnership with Hong Kong based Li and Fung groupServes Mumbai and western region, top 8 consumption centresCDC - Near airport and railway station420, 000 square feet located at Mihan, Nagpur on 20 acre plot48 hours of driving distance from any part of the countryHandle more than 1 lakh pieces per day across different categoriesConsolidate 11 lakh sq ft of warehousing space in various parts of the country.

Information

WMS in inbound ordering

WMS in outbound order managementOther software and technology usedSambandh (Vendor Relationship Management) portal launched to increase visibility in operationsWarehouse management system (WMS)Auto Replenishment System (ARS)Advanced Transportation Management system (TMS)Put-to-light sortation system (PTL Sortation)Pick and Pack systemAutomatic Print and Apply system (Automatic Packaging system)Automatic online conveyor based weigh check systemRFID TagsFuture group DC Inventory (2012 data)

Finished goods inventory at NagpurArea allotted 129591 square feetBins 97664Pallets 1052Current handling 250,000 itemsMinimum retailer inventory at each store depending on store size.

Distributed storage with carrier delivery

Source: http://www.futuregroup.in/pdf/Q2-FY12-Investor-Update.pdf

Framework for network design decisionsProfits due to technologySavings in aggregation 18 to 1 DCNearest to 8 major demand centres Mumbai and western regionNearer to textile manufacturing regionsSavings in logistics cost Nagpur strategic locationMulti-modal International Cargo Hub and Airport at NagpurSEZLand prices less than 12% of India averageRegulatory leniencyTax benefitsAvailability of labour and skillFinancials (detailed calculations in the report)Potential net profit of out-of-stock reduction by Automatic Store Replenishment =180.000for every 500 million of total sales.Potential net profit of labour cost reduction by ASR =Rs. 7 millionfor every Rs. 500 million of total sales.Potential net profit from WMS Warehouse labour cost reduction will be Rs. 2 million for every Rs. 500 million of salesSafety stock reduction: Multiplied by 15 to 20% of inventory carrying cost will save around Rs. 1.2 to Rs. 1.6 million for every Rs 500 million of sales

implementation of systems during the period has significantly reduced the total other expenses as a percentage of Revenue.

Most systems were functional at the end of 2012

Transportationamount spent on Power and Fuel compared to the previous year has reduced by around 40%. (Use of dedicated transport mediumWas changed after 2013 takeover)

Rent has also decreased from 13730.12 million to 6670.22 million which is more than 50%. (Consolidation of distribution centres)

Inventory turnover

Changes for the futureBetter Assortment planning and demand forecasting measures will aid reduction in inventory days by another 8 days.Increase in consumer demand would be the major driver for inventory reduction.Focus on reduction in rent of retail outletsConvert footfall to salesThank you!!!

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