All in with online, can J.C. Penney get up to digital speed?

I had a few occasions chatting with the IT people of the company in the past few years. They were reluctant to adapt to the on-line trend of the retail market. One year, they wanted to expand their on-line catalog business; the next year, they closed the on-line catalog business and moves the majority of their IT people overseas in the following years. This time, it appears that the new SVP, Mike Amend, hired from Home Depot, is ready to face the on-line retail business challenges.

This article highlights a lot of positive actions for the company to transition itself from a traditional retail business to an on-line one.

  • Recognizing its market strength: Research from comScore tells Penney that its customers have household incomes of $60,000 to $90,000, and they tend to be hardworking, two-income families living both in rural and urban settings. They don’t have the discretionary income to commit to membership fees.
  • Last month, Penney added the ability to ship from all its stores, which immediately made about $1 billion of store inventory available to online customers and cut the distance between customer and delivery.
  • About 80 percent of a store’s existing inventory is eligible for free same-day pickup.
    Last week, it offered free shipping to stores with no minimum purchase. Large items like refrigerators and trampolines are excluded.
  • JCPenney.com now stocks four times the assortment found in its largest store by partnering with other brands and manufacturers.
  • More than 50 percent of its online assortment is drop-shipped by suppliers and doesn’t go through Penney’s distribution. Categories added range from bathroom and kitchen hardware to sporting goods, pets and toys
  • JCPenney.com now has one Web experience regardless of the screen: phone, tablet or desktop.
  • Its new mobile app and wallet include Penney’s new upgraded Rewards program. Customers can book salon appointments on it. The in-store mode has a price-check scanner.
  • Penney set out to “democratize access to the data,” so that not only the technical staff could understand it, now dashboards and heat maps allow the artful side of the business — the merchants — to measure such things as sales to in-stock levels or pricing to customer behavior.

Reference: All in with online, can J.C. Penney get up to digital speed?

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Warehouse workers beware: These little robot helpers may be after your job

Check out the video link below. An interesting piece is that the Chinese manufacturers completely copy Amazon’s orange robots to handle its distribution centers.

Again, manufacturing automation and 3D printing is the trend.

Reference: Warehouse workers beware: These little robot helpers may be after your job

An Amazon ‘pick-up’ store may be coming to a college near you

9/14/15 Mailroom by Mei Buzzell Students mail waiting

It makes perfect sense for Amazon to set up physical stores, or join existing Barnes and Noble stores in college campus, due to its shipping convenience and popularity in colleges. This would eliminate the need for those colleges to set up distribution centers in their campus, which is an completely unnecessary infrastructure cost to them.

Some people even suggested Amazon to buy out Postal Services. This is another interesting idea but does not actually solve the package problems to those colleges, because they simply do not have the space and labor to handle those increasing packages.

References:

How Do You Turn Supply Chain Data into Actionable Information?

… There are lots of ways to view data, but three that are particularly useful in supply-chain analytics are –Reporting, Scorecarding, and Benchmarking.

… For instance, a BI report of today displays all the data about transportation providers as usable information, in a scorecard format. Factors such as on-time delivery, freight cost per unit shipped, and transit time are assigned metrics and weighted averages to help users determine how well carriers are performing overall.

… Where reporting is really like looking in the rearview mirror, dashboards are used to see what’s going on now, and makes it easier for users to identify trends and exceptions, and to intervene before something goes wrong.

… Significant cost savings can occur when KPI’s are monitored and the data is accessible in a format that allows users to make informed decisions. The biggest advantage of using dashboards to present Business Intelligence data is that dashboards give companies the advantage of allowing, users to make decisions without having to wait for someone to pull and send reports.

Business Intelligence applied to supply chain also allows for benchmarking. … By benchmarking carriers against each other, you can easily see who is offering you the best deal.

… So as you think about rolling out a BI system. Think in terms of the applications, not the data. Think about what reports are important and how scorecards could improve your visibility into data. Develop dashboards to give you a look ahead, and use scorecards to make sure that you are getting the best deal from your vendors and suppliers. Doing this allows you to see what you want, and get what you see.

Reference: How Do You Turn Supply Chain Data into Actionable Information?

A Great Reference About Reverse Logistics

I recently attended the following Havard Business Review webinar: ” Reverse Logistics: How to Find Hidden Profits by Managing Returns”. The speaker is Curtis Greve. Curtis is currently a principal partner of his own consulting frim, Greve-Davis. He was a VP of Reverse Logistics at Wal-Mart and a president of Reverse Logistics at GENCO. In the webinar, he provided a lot of great insights about his experience in reverse logistics (RL).

The core idea of RL is to recover lost profit and improve revenue through return recovery. It has become more important these days, because of the following reasons:

  • Poor product design,
  • Poor product quality,
  • Poor product instruction,
  • End-of-life cycle,
  • Introduction of newer products,
  • Consumer remorse,
  • Consumer complaints,
  • Product safety concern,
  • Regularity requirements.

Especially, there are increasing regularity requirements to cause product return or recall due to safety, theft, quality, or environmental reasons. Due to increasing global manufacturing output, the total return is increasing (although the global return percentage could remain stable). Furthermore, an average of 80% of returned products are free of defects and can be resold. Companies have increasing responsibilities to manage their return.

In the webinar, Curtis provided a very good flow diagram of the RL with very detailed analysis of both RL’s input and output channels (although he misses the new product buy-back channel today). He also provided a very good insight to reposition RL as a revenue generator than a cost center. I would definitely recommend you to check out and bookmark his blogs and web site.