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Consumer attitudes toward outlet-stores have changed dramatically in recent years, increasing the importance of this sales channel to vendors. Watching this trend, managers at apparel-maker Levi Strauss & Co. saw the need to upgrade supply-chain systems and processes feeding their outlet retailers. Their solution: Isolate these activities in a new distribution center with a singular focus and outsource the operation to an experienced third party.
Now overstocks, irregular merchandise and returns no longer clog the arteries of the company's primary distribution centers. Instead, these items - as well as new product samples destined for Levi Strauss sales and marketing teams - flow smoothly through the company's dedicated facility, a new 246,000-square-foot distribution center known as RISE, an acronym for returns, irregulars, samples and exit strategy products. The facility, located in McDonough, Ga., on the outskirts of Atlanta, is operated by GENCO.
"We launched the RISE project to better fulfill consumers' expectations for shopping in the outlets, to provide a way for the outlet operators to better manage their inventory investment, and to enhance the value of our products," explains Bud Smith, director of asset recovery for Levi Strauss. "As a result, we became a better supplier to our business partners and we have our costs and processes under control. We feel confident at this early point that the RISE operation gives us a competitive advantage."
Headquartered in San Francisco, Levi Strauss is a privately held company owned by descendants of Levi Strauss, who created the first pair of blue jeans in 1873. Levi Strauss today stands as one of the world's leading branded apparel companies. In addition to its line of jeans, the company also markets Dockers, targeted at the business-casual market, and the dressier Slates brand. With sales operations in more than 80 countries, it reported net sales of $4.6bn in 2000.
|"We wanted to locate the facility where it made sense from an outbound shipping perspective, since freight cost was a major concern."|
-Bud Smith of Levi Strauss
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