John Lewis. Dino Rocos, Operations Director

Transcription

1 John Lewis Dino Rocos, Operations Director

2 A Time of Change

3 The Customer Proposition continues to Evolve Personal Mass Mass Personalisation

4 Customer Expectation also continues to Evolve Shopping Enthusiasts Service Seekers Solution Demanders Assortment width Availability Added value services Fulfilment integration Rapid fulfilment Convenience

5 Customers want to transact in different ways 29% of customers research in shop and buy online 63% research online and buy in a shop 19% of shoppers use mobile to research before they purchase

6 Retail is having to respond

7 Supply Chains are also having to respond Omni-Channel Speed Agility Breadth of Offer Customer Focus Critical Dependency

8 Making Supply Chains more Complex 8.5 m Orders 3.5 m Orders 3m Orders 2.5 m Orders 1.5 m Orders Magna Park Clipper I-Force Blakelands Northampton Supplier Click & Collect Home Delivery 1Man 2 Man International 1.2 m Orders Direct to Customer 3.2m Orders 2.6m Orders 1.4 m Orders 9.5 m Parcel dels 4.3 m 2 Man dels Services 0.3 m Parcels

9 And more Expensive 15% Supply Chain Costs as a % of Sales 14% Service eg: online 13% 12% 11%

10 Retailers are reviewing their Supply Chains

11 What are the questions we are trying to answer? Customer Challenges Financial Challenges Supply Chain Challenges Change Challenges

12 Customer Challenges Mass to Mass personalisation From Information to Insight Zero Tolerance Do you have clarity of proposition? Do you know your Customers? Is service promise delivered?

13 Financial Challenges Channel reporting an irrelevance? Understanding the Cost to Serve End to End KPIs and Budgets Is financial reporting aligned with business model? Are you managing your cost drivers? Are performance measures adapted to for omnichannel?

14 Supply Chain Challenges Speed Synchronisation and Agility Information Do you know what slows you down? Are you organised to work end to end? Systems and data adapted to (future) needs?

15 Change Challenges How much? A Long Journey Different Skills Is your strategy clear, owned and affordable? Do you have a plan to get there? Have you got what it takes?

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17 Programme Q s Key Themes The right amount of stock in the right place at the right time This is about how we order stock, ship it from the suppliers and move it within John Lewis An agile supply chain that exploits scale to drive efficiency This is about how we store stock and about the organisation of the distribution network Empowered Partners driving operational excellence Fulfilment beyond customers expectations This is principally about Partner development, but also covers the implications of the other strategic themes on Partners This is principally about deliveries to Customers but also covers the implications of the other strategic themes on Customers

18 The right amount of stock in the right place at the right time Better Systems Tracking Stock Holding will give us a joined up view of our stock information including RFID, will tell us where stock is holding stock in fewer places makes it easier to track Better stock accuracy will also help us to reduce stock loss and provide a better customer service!

19 An agile supply chain that exploits scale to drive efficiency Distribution Centres Customer Delivery Hub Fewer, Larger NDCs Built for Efficiency Regional optimisatio n Removal of ancillary activities NDC CDH Pooled Branch & Online Stock Specialism in Handling type Agile network Reduction in scale

20 Empowered Partners driving operational excellence Our experience, tells us that a Partner workforce is best So our preference is to insource our supply chain operations and reduce our use of agency staff Unless A third Party has an unbeatable advantage from e.g. scale or We can t afford to build a new facility with our own money or The Partnership model doesn t deliver the advantage that it should We are also aiming to keep it in the Partnership by collaborating with Waitrose

21 Fulfilment beyond customer expectations Fulfilment through customer delivery is all about service and efficiency Efficiency critical to service delivery Improved JL Fleet 2 man delivery platform for new services Supplier direct Technology improving utilisation of the fleet New technology provides customer visibility and control 1 man delivery remains outsourced for now, but we will keep the business case under review

22 Investment Systems Process Infrastructure Partners Total 369m

23 Systems Support Cost Delivery -Scheduling -2 man deliveries -1 man deliveries - 75 Distinct Services National Distribution Centres - Magna Park automation - Reverse Logistics Stock - Enterprise Resource Planning (ERP) solution from

24 Working in partnership

25 Questions