FORTE Reduces Transportation Costs by $4 million for Specialty Retailer of Urban Apparel

The Challenge
This fast growing multi-channel retailer had over 450 stores and plans to nearly double over the next five years through both organic growth and acquisitions.

Direct-to-consumer volume had also doubled, and transportation costs were being driven higher by the geographic placement of the store fulfillment center.

The Solution
FORTE used a network optimization model to simulate the effects of market growth on outbound transportation cost and service levels.

They modeled and tested various geographic DC combinations and identified a go-forward strategy.

Using the identified go-forward path they were able to develop layouts and process flows for the new facility.

The Result
The network optimization model identified that a single, but relocated DC would support growth for 3-5 years.

This solution would reduce transportation costs by $4 million and increase customer service levels from 7 to 6 days for the entire US and 5 day delivery would improve from 52% to 93%.

A second DC could also be justified in year three. FORTE provided a compelling business case and the recommendations were implemented within 6 months of completion of the study.