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- 1. I N T R O D U C T I O N T O B U S I N E S S L O G I S T I C S A COMPREHENSIVE ANALYSIS Prepared By: Naimik Patel Greeshma Patel Akilravi Nirmit Desai Akshay Gachinakatti
- 2. Page 2 History and Profile Structure of Approach Competative Analysis Procurement and Inventory Decisons Challenges, Impacts and Solutions Conclusion Comparetive Analysis Supply Chain and Management Approach Strategic Planning and Approach Sucess and failure factors 01 02 03 04 05 06 07 08 10 09 Table Of Content
- 3. Dollarama History and Profile Dollarama was founded by third-generation retailer and Canadian entrepreneur, Larry Rossy. It all started with one store, in Matane, Quebec, in 1992, and quickly grew over the next two decades to become a household name and shopping destination for Canadians from coast to coast. Dollarama today is a recognized Canadian value retailer with well over 1,000 locations, led by Neil Rossy, fourth-generation retailer and member of Dollarama’s founding management team. Page 3
- 4. Dollarama’s Supply chain Approach Dollarama's supply chain prioritizes efficiency and flexibility. Diversifying sourcing, optimizing logistics, and embracing automation ensure a reliable and resilient operation, reinforcing its position as a leading Canadian discount retailer. Sourcing Directly Diverse Supplier Base Responsible Sourcing and Extended Supply Chain Monitoring Page 4 Benefits of obtaining items directly from suppliers, avoiding intermediaries, and negotiating cheaper rates Advantages of a varied supplier network, reducing dependencies, and ensuring flexibility Emphasize product safety standards, fair treatment of employees, and environmental preservation
- 5. Page 5 Importance of Supply chain and logistics management •Driving efficiency • Reducing costs •Improving Customer Service •Gaining a Competitive Advantage •Managing Risks • Sustainability and Corporate Social Responsibility
- 6. Dollarama's three- pronged supply chain strategy Sourcing Directly Benefits of obtaining items directly from suppliers, avoiding intermediaries, and negotiating cheaper rates Diverse Supplier Base Responsible Sourcing and Extended Supply Chain Monitoring Dollarama's Supply Chain Approach Page 6 Advantages of a varied supplier network, reducing dependencies, and ensuring flexibility Emphasize product safety standards, fair treatment of employees, and environmental preservation.
- 7. Impact on key business areas Sustainability Cost Efficiency Innovation Page 7 Responsible sourcing, adhering to product safety standards, and promoting ethical practices •Direct sourcing, eliminating intermediaries, maintaining industry-leading margins. Quick adoption of new and trendy products due to a broad supplier network Customer Satisfaction Timely product updates, and a diverse range of items to meet customer needs. Example: Dollarama's ability to swiftly offer popular seasonal items and trend-driven products showcases its commitment to customer satisfaction and innovation
- 8. Page 8 Competitive Advantages of Dollarama Vendor base is diverse and flexible, sourcing products from over 25 countries. Cost Efficiency and Product Variety Customer Service and Feedback. Proactive Risk Management. Environmental Consciousness.
- 9. Components Impact on logistics Procurement and inventory choices: Flexibility in procurement allows the company to adjust sourcing decisions based on changing market conditions and risk profiles. Segmentation May require a more complex logistics operation to manage different product categories efficiently Warehousing Reduces operational costs and environmental impact Transportation via trains Rail transportation provides cost-effective and eco- friendly solutions for long-distance movements Technology and Logistics Improves energy efficiency, reduces operational costs, and enhances overall productivity Key elements related to supply chain and logistics management: Page 9
- 10. Supply Chain Structure & Sourcing Strategy • The stages: sourcing, warehousing, transportation and distribution. Sourcing • Direct sourcing from over 1260 vendors
- 11. Central Warehouse Montreal Store network 1 Store network 2 Store network 3 Store network 4 Store network 5 Import through the Port of Vancouver Warehousing, Transportation & Distribution • 500,000-square-foot central warehouse in Montreal • Hub and spoke system for Distribution • Favours Rail transport to limit its reliance on long-haul truck transportation. • Measures taken to reduce GHG emissions and optimize container usage Procurement & Inventory Strategy • securing long-term relationships with reliable suppliers • central warehouse and JIT (Just-In-Time) inventory systems Page 11
- 12. Segmentation Strategies • Target market, low-priced products to a diverse customer base. • competitive pricing approach with products typically priced between $1 to $4 CAD • Wide-ranging product portfolio • strategic store locations in high-traffic areas Planning, and Operational Logistics • Demand forecasting based on historical sales data and market trends • Use of advanced WMS and TMS Page 12
- 13. The major challenges that the company must overcome in their supply chain and logistics operations Dollarama's revenue growth is attributed to well- stocked stores and a diverse product range. Supply chain strengths ensure timely product availability. While less congested ports provide an advantage, Transpacific shipping rate increases pose risks. To tackle challenges, Dollarama should diversify sourcing, optimize the supply chain, and stay vigilant for disruptions. Page 13 Supply Chain Disruptions Inflation and Rising Costs Labor Market and Workforce Management
- 14. Page 14 Implementing risk management strategies and building contingency plans can help mitigate the impact of unforeseen disruptions. Supply Chain Disruptions • Diversify sourcing regions and suppliers • Implement risk management strategies • Build contingency plans for unforeseen disruptions • Optimize supply chain costs • Negotiate with suppliers • Strategic pricing adjustments • Competitive wages, benefits, & growth opportunities • Optimize workforce scheduling • Adopt automation for warehouse operations Inflation Tight Labour Market
- 15. Supply Chain Broad supplier network, efficientsupplier management, data-driveninventory optimization, centralized distribution model Bulk purchasing, efficient supplier relationships, streamlined inventory control, centralized distribution model with large distribution centers Well-established supplier relationships, bulk purchasing, cost-efficient sourcing Streamlined inventory control, centralized distribution model, focus on $1 pricing strategy Focus on Product Quality, Data- Driven Approaches, Cost-Effective Distribution Emphasis on $1 pricing strategy, Narrower product selection, Strict inventory control Efficient supplier network, strong relationships competitive prices, consistent quality, Data-driven inventory optimization, balanced stock levels to meet demand Focus on Product Quality, Data- Driven Approaches, Cost-Effective Distribution Diverse product assortment, Balanced stock levels for various product range Differences Similarities Inventory Management Supplier Management Comparative Analysis: Dollarama vs. Dollar Tree Inc. in Supply Chain & Logistics Aspect Dollarama Dollar Tree Inc Page 15
- 16. Conclusion Dollarama's success as a leading Canadian value retailer is driven by efficient supply chain management, direct sourcing, and a diverse supplier base. Customer happiness, sustainability, and innovation strengthen its position in the retail industry. Strategic focus on diversified sourcing, supply chain optimization, cost-cutting, workforce management, and technology integration ensures continued growth and customer- centricity. Page 16 • Efficient supply chain and logistics management drive success • Direct sourcing and diverse supplier base for product variety and cost-effectiveness • Commitment to customer happiness, sustainability, and innovation • Strategic focus on diversified sourcing, supply chain optimization, cost-cutting, workforce management, and technology integration for overcoming challenges and ensuring future growth.
- 18. References 1) Suman, & Suman. (2023). Importance of supply chain management. Intellipaat Blog. https://intellipaat.com/blog/importance-of-supply-chain-management/?US 2) About us - Dollarama. (2023, July 10). Dollarama. https://www.dollarama.com/en-CA/corp/about-us 3) Annual information form – Dollarama https://www.dollarama.com/en- CA/corp/wp-content/uploads/2021/04/2021-Annual-Information-Form-vFINAL.pdf 4) Dollarama. (2023). Annual ESG Report. https://www.dollarama.com/en-CA/corp/sustainability 5) Ross, D. (2018). Dollar Store Logistics: Inside the Operations of Dollarama. https://www.canadianshipper.com/