Supply Chain Study

Presented to Dr. Xiuli He MBAD 6208 - Supply Chain management By Kaushik Reddy Boyapalli, Satyajeet Saravane & Vishal Pareek

ROSS - Overview
1982 Pleasanton, California

Products & Sales

Competitors
30,000.00 25,878.37 25,000.00

20,000.00

19,279.00

Ross Stores 15,000.00

Kohl's
TJX Companies

10,000.00

9,721.07

5,000.00

0.00 Annual Sales in Millions

Competitors
9.00% 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% Net Profit Margin (%) 8.09% 7.37% 6.41%

Contd..

5.11%

Ross Stores Kohl's TJX Companies Industry Median

Locations

Strategy & Target Customer

18- to 54-year-old shoppers from primarily middle-income households. Off-price strategy.

20% to 60% cheaper than specialty store.

Minimal in store service. Quantity discount from suppliers.

Revenue vs Net Income

Challenges

Business Model

Off-Price Purchasing

Packaway Inventories

Treasure-hunt shopping experience

Performance on SC Drivers
Sourcing
Network of approximately 7,900 merchandise vendors and manufacturers. Off-pricing business strategy

Pricing
Sell brand merchandise 20%-60% lower then regular price.

Inventory
Packaway inventory accounted for 47% and 49% of total inventories as of Febraury 02, 2013 and January 28,2012.

Transportation
Contract Carriers Use third party cross docks to distribute

Information

 Facilities

Merchandise Flow:
In any operations setting the merchandise/products pass through the following flow or their combinations:

PROCESS

PEOPLE

TECHNOLOGY

Distribution Center:
ROSS SEDC

RTW

NRTW

Drawstrings

Other

Fragile

HAD

Bulk

 PROCESS
A process than follows six sigma and reduces the cost of processing to less than 23 cents for a merchandise

PEOPLE:
More than 1800 associates working in 3 shifts to achieve the target of processing 1.2 million to 1.3 million merchnadise everyday. Huge labor demand : Close ties with DMSI staffing agency and measures no discourage union formations

TECHNOLOGY:
Oracle RETEK merchandising software RMS and RDM Web Intelligrated software service for the unit picking system Work in symphony to deliver real time results to management

PROCESS:
The main aim of the supply chain of Ross is keeping the costs low. They do nor manufacture therefore the pack-away inventory is high and inventory holding costs are reflected in the final price. Standardized process is set at DCs to reduce the costs and maximize processing: 1. Receiving 2. Sorting & Unit ID 3. Marking 4. Waved for either:
Hotel (storage. Warehouses) Tilt Tray/pack range Shipping

Receiving:

1. 2. 3. 4. 5. 6.

Create Appointment Schedule Appointment Print Receiving Packet Trailer Unload Freight Bill Verification Freight Bill Reconciliation

Sorting and Unit ID:

- Verifies the merchandise according to the specifications and details provided by the purchasing office - Receiving of merchandise - The units are entered into the system which are tracked in real time by the management to reach the production target

Marking:

- Labor intensive and most time consuming stage in the process - Bottleneck - Markers apply the price tickets to each and every merchandise manually

Waving:

Depending on the demand the marked merchandise can waved to any of the following: Tilt tray Hotel Pack range Shipping

Birds Eye View: