FOCUS: Home Centre streamlines supply chainby ASC Staff on Nov 28, 2016
Furniture and home accessories giant Home Centre is phasing in a new in-store system intended to streamline the company’s supply chain in the Middle East.
The introduction of mobile POS into company stores will enable the gradual phasing out of tills in stores and enable sales assistants to showcase products in store, but also have access to the full catalogue and increased knowledge of products in the warehouse.
Home Centre is the first home retailer and company at Landmark to undertake the pilot scheme.
“We can process the order for the individual right there in store, right by the product, rather than dragging the customer away to a till in the corner of the store and take payment,” says chief executive officer Médéric Payne, speaking to Middle East Business Review.
“This new process will also enable the company to align its supply chain so the employee can ascertain the type of customer and reduce customer waiting time and ensure a positive outcome,” he adds.
Following on from these technological investments, Home Centre is utilising Hybris and Oracle to ensure it operates correctly and safely, ensuring efficient reporting.
Data is vital to the company’s supply chain, which is supported through the use of the Shrukran Rewards Loyalty Programme, the largest loyalty programme in the region. With over 15 million members, the programme covers all of the GCC and delivers a number of key benefits.
“If they buy a bed, do they buy the bed linen with it? Do they buy pillows, or are they just buying the bed? We can do real data analytics,” explains Payne.
This enables the company to understand its customer profiles and therefore match requirements with what the company can source, whether it is colours, styles, or designs in order to cater to customers.
Through this information, Home Centre is looking to get products to market quicker, and improve accuracy in terms of inventory management, but it’s a double-edged sword.
With customers gaining an increased awareness and access to information on where to buy products which are priced more attractively, the market has become increasingly competitive.
“When customers shop online, they are looking at other countries and how much products might cost them,” says Payne. “They are comparing prices for goods in other markets, so you have to be competitive in getting pricing and costs aligned, which starts to affect where our sourcing decisions come from. How much more local sourcing can we do to reduce transportation costs, reduce lead times - it’s amazing what effect that’s having on the thinking and strategic sourcing.”
This strategic sourcing is being applied in Home Centre’s warehouses through strategic inventory management. The company is using Radio Frequency Identification (RFID) technology to better track products.
“This is the chip in every product that has a unique number, so the idea is rather than knowing that I’ve got 10 of an existing product in stock, in future it will show exactly which 10 they are and where they are, so you start having more traceability,” explains Payne.
This technology will ensure stock figures are correct, but more importantly, it will support manufacturing errors which can occur with suppliers. “You will be able to trace exactly which customer has had which item, and it saves time and money in the long run,” says Payne.
Home Centre has overhauled its logistics as a result of company growth. It is aiming to build more cost effective, safe and productive warehouses and upgrade their logistics systems. “In the UAE we have a couple of sites that we are constantly tweaking to improve our productivity,” says Payne. “Unlike many major retail stores, where a product goes from the warehouse, into stores, then into the customer’s home. At Home Centre, we often have customers ordering in store, then receive their delivery straight from the warehouse. So, we aim to constantly improve our warehousing capabilities.”
Home Centre manages its logistics in-house, with its own warehouses and a fleet of in house delivery trucks and carpenters to assemble furniture for clients, this enables Home Centre to better absorb its logistics costs. “We are different to European markets where the deliveries you have to pay for. Here, there is an expectation that if someone orders a bedroom suite, we will come deliver it and assemble it,” says Payne. “The one thing that Home Centre and a lot of retailers have to get right today is their supply chain. If you can embrace technology in the supply chain in this new world that’s been changing in the last six years, then your future looks bright.”
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