Strengthening Supply Chain with Slim4 for Expansion to 1,000 Stores: Rituals’ Strategy
Home and body cosmetics brand Rituals, known for offering luxury cosmetics at affordable prices, has set an ambitious goal: to expand to 1,000 stores and 1,000 shop-in-shops worldwide. Mark Hoppenbrouwers, Supply Chain Director at Rituals, emphasizes the necessity of a robust supply chain to support this rapid expansion. “The rapidly growing number of locations in conjunction with a rapidly growing range requires a very robust supply chain,” he says.
To achieve this, Rituals has implemented Slim4, an inventory optimization system provided by Slimstock.
Background
Since its inception selling luxury hampers, Rituals has expanded to offer hundreds of products globally. The company’s growth strategy includes opening new stores annually and developing shop-in-shop concepts within luxury department stores. “The complexity of this formula is compounded by the growing number of suppliers and the rapid range expansion and globalisation. Prior to Slim4, this growth had always produced a negative effect on stock turn.”
Better Service, less stock
In 2008, a year marked by explosive growth for Rituals, the previously experienced supply chain bottlenecks were mitigated due to the focus brought by Slim4. This system allowed for centralized stock purchasing and laid the foundations for Rituals’ 1,000 store growth strategy. “The strengthening of our supply chain has also resulted in a service level increase from 92% to 97% and a reduction of logistics costs as a percentage of sales. Slim4 has guaranteed the availability of the stock to the desired level; in addition, our stock turn has improved by 15%. This is in spite of a range growth of 20%,” says Hoppenbrouwers.
Promotions & gift packs
Rituals also leverage Slim4’s Bill of Materials functionality to manage the production of gift packs, ensuring all components are received on time to meet demand. “The beauty of Slim4 is the ability to work with a combination of daily, weekly, and monthly tasks and also the flexibility that allows us to monitor each product on an individual basis. In addition to the promotional articles, Slim4 is also able to manage our new product introductions and the phasing out of old products.”
More time for the customers
Rituals determines the service level that it requires (per product) and then sends its suppliers monthly forecasts based on the order advice provided by Slim4. “Rituals are laying the foundations which will allow us to use Slim4 to centrally control all of the store replenishment”, says Hoppenbrouwers. “Slim4 will calculate the optimal stock per store and will automatically place orders on the DC. The increase in service levels and the corresponding increase in sales at each store are largely due to the reduction in planning hours at the store. Implementation of Slim4 has also allowed our staff to have more time with our customers!”
By implementing Slim4, Rituals strengthened its supply chain and positioned itself to achieve its ambitious growth targets while improving customer service and operational efficiency. This strategic move not only ensures better stock availability and enhanced service levels but also empowers the staff to focus more on customer interactions, ultimately enriching the customer experience.