Improving the ordering process between a fashion retailer and its external suppliers

Examensarbete för masterexamen

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Type: Examensarbete för masterexamen
Master Thesis
Title: Improving the ordering process between a fashion retailer and its external suppliers
Authors: Nodén, Linda
Olson, Elin
Abstract: This study concerns a mid-sized Swedish retailer that offers a wide range of products within beauty, fashion and home decor. The retailer is currently experiencing significant problems connected to the ordering process with their external fashion suppliers. These are issues such as high amounts of manual work, several non-value adding activities and delivery problems at the distribution centre. This has led to low efficiency and long process lead times. As lead times and supply chain efficiency are two important factors for creating competitive advantage in fashion retail supply chains, there was a need for investigating how the ordering process could be improved. The purpose of this study was to suggest a new ordering process that increases efficiency and reduces the amount of non-value adding activities. To fulfil the purpose of the study, it was first necessary to understand the retailer’s current ordering process. This was achieved by conducting nine interviews with employees as well as making observations at the retailer’s office and distribution centre. Interviews were also conducted with representatives from seven of the retailer’s external fashion suppliers. The current ordering process was compared to the ordering process used by similar actors, in this case a Danish retailer and an online retailer. A description of the similar actors’ processes was generated from two interviews conducted with one representative from each actor. An interview was also performed with a supplier that offers electronic data interchange solutions to actors in the industry to increase efficiency in their ordering processes. An analysis was then performed of each retailers’ ordering process using value stream mapping as a tool for identifying non-value adding activities and improvement areas. There were five main categories of waste identified in the three retailers’ ordering processes, namely corrections, waiting, transportation, extra processing and underutilised people. Compared to the ordering processes of the Danish and online retailer, the Swedish retailer’s process involves a considerably larger amount of waste. To remove the non-value adding activities, a suggestion for a new ordering process was developed using the tool provided by the electronic data interchange solution supplier. It is concluded that, by implementing the suggestion made for a new ordering process, it is possible for the retailer to automate several steps in the ordering process and minimise nonvalue adding activities, thus achieving higher efficiency and shorter process lead times. Furthermore, the new process will reduce the workload for the buyers and they will be able to handle the large supplier base in a more efficient way.
Keywords: Innovation och entreprenörskap (nyttiggörande);Maskinteknik;Innovation & Entrepreneurship;Mechanical Engineering
Issue Date: 2017
Publisher: Chalmers tekniska högskola / Institutionen för teknikens ekonomi och organisation
Chalmers University of Technology / Department of Technology Management and Economics
Series/Report no.: Master thesis. E - Department of Technology Management and Economics, Chalmers University of Technology, Göteborg, Sweden
Collection:Examensarbeten för masterexamen // Master Theses

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