L.L.Bean has seen a lot of change in its 100-year history. From its beginnings as a catalog merchant, the company has grown into a global, multi-channel retailer with physical stores and e-commerce channels, in addition to its popular catalog business. But some things haven’t changed — in particular, the company’s loyal fan base and commitment to customer service.
Keeping those customers happy can be a distribution challenge. Last year, L.L.Bean shipped more than 14 million orders from its distribution center in Freeport, Maine. That’s an average of about 45,000 orders a day. Yet close to 60% of those orders are processed in the six weeks before Christmas. During peak, the company ships nearly 1 million packages a week.
A few years back, L.L.Bean found that both its e-commerce and store fulfillment DCs were reaching capacity and would soon strain the company’s ability to grow. At the same time, it was being pushed to speed up processing in the DC so as to fulfill commitments for on-time delivery. Operating in a labor-constrained region of the country, the company wanted to reduce the amount of seasonal help required to fulfill orders during peak.
L.L.Bean turned to Fortna Inc. for help. After detailed analysis, the decision was made to embark on a long-term, multi-step approach to transform L.L.Bean’s distribution operations for greater efficiency and improved costs.
First, a replenishment sorter was installed to speed up the process and free up space. Next, Fortna worked with L.L.Bean to install a multi-level pick module that made more space available, and order picking more efficient and accurate. Then came the more challenging part of the project: shutting down L.L.Bean’s store DC, and merging those orders into the e-commerce DC in order to get synergies of inventory and personnel. But the e-commerce DC would require a complete overhaul, requiring:
All this needed to happen without disrupting current operations, concurrent with the implementation of three major systems: enterprise resource planning (ERP), warehouse management system (WMS), and forecasting.
It was a complex project, one of the biggest investments in company history. Fortna worked with L.L.Bean to develop a complete integrated design of the new system. The vendor identified changes that would be needed to the customer’s processes, including its Manhattan Associates WMS, FortnaWES, material-handling equipment, and training procedures. The two-year implementation was a comprehensive effort with lots of moving parts and complexity, including the need to ensure the solution stayed aligned with the original plan.
The distribution transformation was a huge success, according to L.L.Bean. Orders that used to take 10 hours to be processed are now finished in less than two. The volume of orders that can be processed in the DC increased by 50%. And overall productivity improved 39%.
In addition, jobs in the DC were simplified, making it easier to train all the temporary labor needed for peak, and helping to reduce the amount of seasonal labor required due to efficiencies from the project.
“There was little room for error in this project,” says Jack Samson, vice president of fulfillment, manufacturing and logistics with L.L.Bean. “We had to be sure we didn’t disrupt current operations.”
Adds Samson: “The success of this project was even greater than we imagined — a 39% increase in productivity. We are well-positioned to support the business in the future.”
Timely, incisive articles delivered directly to your inbox.