The client was experiencing rapid store growth and product assortment expansion, in conjunction with a very slow markdown cadence. Upstream processes of merchandising and planning were immature, and the company lacked logistics processes compared to industry peers. The supply chain model did not include distribution centers to hold back product, causing every order being 100% allocated to stores, resulting in extreme overstocks.
Further, the merchandise, planning and allocation teams worked in silos, with very little common knowledge of the allocation system’s capabilities and heavy reliance on basic default system variables. The client’s teams were further hampered by minimal training and unclear direction.