Transforming Its Supply Chain Presented by: Bastian Solutions FIND - PowerPoint PPT Presentation

The Rise of the Urban DC – How Best Buy is Transforming Its Supply Chain Presented by: Bastian Solutions FIND YOUR WOW

Rob Bass Greg Conner Chief Supply Chain Officer Vice President of Sales Best Buy Bastian Solutions Marvin Logan Vice President of Consulting Bastian Solutions FIND YOUR WOW 2

Objectives 1. Modernizing the Supply Chain 2. Analyzing the Right Data 3. Selecting the Best Technology FIND YOUR WOW 3

Modernizing Best Buy’s Supply Chain FIND YOUR WOW 4

The Right Team The Right Systems The Right Tools The Right Network FIND YOUR WOW 5

The Perfect Storm of Re-Pack & E-Commerce 80% of 60% Explosion “Just in Time” In Inventory SKUs E-Commerce Units shipped Eligible for Repack are re-pack FIND YOUR WOW 6

FIND YOUR WOW 7

FIND YOUR WOW 8

Current RDCs + MECs Piscataway, NJ Chicago, IL RDC San Francisco, CA Findlay, OH MEC Compton, CA Atlanta, GA FIND YOUR WOW 9

Process for Achieving New Supply Chain Initiatives Data Analysis Summary FIND YOUR WOW 11

Network Modeling/Supply Chain Optimization Channel Differentiation: MEDICAL • Supplies • Consumables • Controlled/Bio • Basics • Parts • Equippage PHARMA • Sched II and III • Launch • Experimental/Sched I • Push • Basics (Fast and Slow) • Vital Stock (99.7%) • Bulk • Temp (DF, F, C, Ch, Cl) • Emergency/Disaster • Disease Control FIND YOUR WOW 12

Engineering Study Methodology 1 2 3 4 5 Define Measure Analyze Design Validate FIND YOUR WOW

20X Retail Units Holiday E-Commerce Volume Spike 2-3X Holiday Season Volume Warehouse to Stores FIND YOUR WOW

Sales Channel Characteristics Metric Retail E-Commerce Units/Line 3.1 1.1 Lines/Order 160 1.65 Active SKUs/Day 6,400 1,640 Avg Lines/Day 53,500 5,000 Avg Units/Day 165,000 5,500 FIND YOUR WOW 15

SKU Pareto by Sales Channel SKU Pareto by Sales Channel 100% % SKUs # SKUs % Retail Picks % E-Com Picks 80% 1% 162 7% 35% % PICKS 60% 2% 324 13% 46% 40% 5% 812 28% 63% 20% 10% 1,624 46% 75% 0% 20% 3,248 69% 87% 1% 7% 13% 19% 25% 31% 37% 43% 49% 55% 61% 67% 73% 79% 85% 91% 97% 50% 8,120 96% 98% 75% 12,180 100% 100% % SKUS Retail Ecom FIND YOUR WOW 16

Magnitude of Holiday Spike in Demand Utilized MECs to quickly satisfy high demand in densely populated urban areas 6/1 7/1 8/1 9/1 11/1 12/1 1/1 2/1 3/1 4/1 5/1 FIND YOUR WOW 17

Overview of Solutions Overview of Solutions FIND YOUR WOW 18

FIND YOUR WOW 19

Throughput Comparison Picking Response Operating Storage Expandability Throughput Time Flexibility Density FIND YOUR WOW 20

Why AutoStore? MECs FIND YOUR WOW 21

1 AS/RS for Reduce Ability to Batch Both Sites Touchpoints From GTP Port FIND YOUR WOW 22

RDCs 150,000 bins RDC 195 robots FIND YOUR WOW 23

MECs 30,000 bins MEC 73 robots FIND YOUR WOW 24

Computer Simulations Modeling FIND YOUR WOW 25

Process for Achieving New Supply Chain Initiatives Define Scope Vendor Selection Right Right Educate the Acquire Funding Design Team Team Consultants Team Implementation Team Build. Learn. Refine. Repeat. FIND YOUR WOW 26

Rob Bass : rob.bass@bestbuy.com Website: www.BestBuy.com Greg Conner : gconner@bastiansolutions.com Website: www.BastianSolutions.com Marvin Logan : mlogan@bastiansolutions.com Website: www.BastianSolutions.com Visit ProMat Booth S1603 FIND YOUR WOW 27