Saks Keeps Up With Merchandise Demand

Saks Inc.'s Challenge
Keeping 300 stores stocked with merchandise to meet the increasing demands of today's retail market is a big challenge. At the same time, the company needed to drive costs out of its supply chain to remain competitive. Saks Inc. decided to consolidate its current distribution network to regional distribution centers. Reducing its facilities from eight distribution centers to three, the company expects to realize considerable savings through reduced freight costs and lower total overhead costs. The challenge was to maintain the same service levels that keep their stores with merchandise on the floor, while driving significant costs out of their logistics processes. The company needed to be able to get merchandise to their stores faster and on the floor quicker, while taking inventory out of the system.

Saks Inc.'s Goals
In support of the corporate Logistics Network Strategy, Saks Inc. built a brand new $25 million, 180,000 square-foot distribution center specifically designed for flow-through operations. The company wanted to be able to receive goods marked with advanced shipping notices from the vendor and process the merchandise directly through the facility to the appropriate shipping dock. All merchandise needed to be tracked throughout the facility by vendor identification at the carton level, to avoid the need for re-labeling onsite. In addition, there were no plans to put-away or store merchandise in this facility. Their goal was to move 90% of the goods directly through the distribution center without the merchandise ever being touched by human hands.

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