On October 23rd, 2014, we updated our
By continuing to use LinkedIn’s SlideShare service, you agree to the revised terms, so please take a few minutes to review them.
West Marine: Driving growth through
Shipshape Supply Chain Management
Ranjeet Kumar Singh (11BM60068)
West Marine: Merger with E&B
In 1997 , West Marine acquired an East Coast competitor, E&B Marine
Sales fell by almost 8 %
Peak-season out-of-stock levels rose more than 12%
Supply Chain was badly hit
West Marine not enough to support an organisation double its size
West Marine: Strategy Focus post 1998.. (1/2)
Key players were changed by veterans from the industry
People were recruited based on experience in large and complex retail
Each executive was given the mandate to turn around his respective function
Strategic plan started with West Marine’s vision of being ‘the best boating
products company everyday’
Outlined performance indicator goals - ROE, cash flow, comp sales, EPS,
Productive Service Levels, Market Share and customer & associate satisfaction
West Marine: Strategy Focus post 1998.. (2/2)
3. People and Culture
Cultural Change drive on providing “better than expected customer service”
Leadership team addressed all the problems head on
Outside experts in cultural change were brought in
Significant effort was put in redefining roles
Silos mentality was transformed to new transparent communication
4. Systems and Processes
Every processes were reviewed and reinvented
Strategy was focused on take SG&A out of the business at the same time to starts
the operations more effectively
Supply Chain Collaborations
Particular emphasis on changing the Supply Chain Management Practices
Supply chain was more complex as compared to most speciality retailers.
E&B acquisition further compounded supply chain challenges by adding more
stores, new SKUs and different assortments.
Improvements started with team putting halt to all store expansion to relieve
Critical importance was placed on improving end-to-end supply chain visibility and
effectiveness, driving down related costs and improving the level of SCM
collaboration within and outside west marine.
Also, later focus shifted to Collaborative planning, forecasting and replenishment
CPFR: Implementation at West Marine (1/2)
Collaborative Planning, Forecasting and Replenishment- combined & capitalized
on the intelligence of multiple trading partners in the planning and fulfilment of
Works on the development of a single, shared forecast that supported the joint
plans of the trading partners
Clear performance measures are defined to document operational performance
Risk is monetized so that partners faced clear financial consequences
Incentives were used to motivate collaborative, cooperative behaviour and to
share the benefits.
Exchange of more timely, complete and realistic forecast data, which led to higher
CPFR: Implementation at West Marine (2/2)
Linked best practices of sales and marketing divisions.
Adopted conventional order management, with the retailer driving forecast, order
planning and order generation.
Implemented a successful, robust linkage between the point-of-sale and DC
systems to maximize automation and mass-maintenance procedures which gave
multi-echelon replenishment solutions.
Implemented EDI using SPS commerce solution
Stock rates at the stores came close to the goals of 96% in every store
Forecast accuracy climbed up to 85%
On-time shipments were also improved.
STRATEGIES - For Proposed Takeover of BOATU.S.
Requirement of Vendor and SKU rationalization effort
If going for Dual-Branding Strategy and decides to maintain the BoatU.S. brand,
the company has to develop a more diverse product base and more unique
Integration of the replenishment activities
Overall complexity involved in the supply chain integration of both companies is
high since both offered 50,000 SKUs via stores, internet and catalogues.
The experience gained from the CPFR needs to be used and applied for the
successful integration of two companies.
Recommendations for Acquiring BOATU.S. (1/2)
Seek long-term, holistic solutions, not quick or myopic fixes
Reconcile conflicting goals and metrics
Pursue inclusive problem-solving; do not depend upon “experts” who don’t have
accountability for the business
Install collaborative processes that encourage idea creation, shared problem
solving, and high adoption rates across organizational boundaries
Use a disciplined and iterative set of methodologies such as CPFR, SCOR, or Six
Sigma to help teams define issues, root causes, and solutions
Develop a culture of continuous improvement, particularly at the customer-facing
Recommendations for Acquiring BOATU.S. (2/2)
Create clear accountabilities and assign authority with a focus on core business
processes rather than on traditional organizational “silos” or loyalties
Commit to technology enablement for execution, communication, exception
management, and root-cause analysis
Reduce decision cycle times and Implement rapidly
Warehouse replenishment - Responds to all store-level overstocks and under
stocks which eliminates duplicate forecasting
Integration of DC in 30 days post acquisitions and in-store operations in 60 days