Extending the Reach of the DC

Integrating Logistics from Factory to Shelf
Many have discussed the advantages of integrating management of inventory and replenishment across the retail supply chain, from the factory through the manufacturer’s DC, the retailer’s DC, all the way to the store shelf and POS (Point of Sale).

But what about integrating logistics from the factory to the store shelf? That represents an opportunity for innovative and agile efficiency that I call ‘extending the DC.’ The concept of extending the DC evolved from an enlightening conversation I had on this topic with Diego Pantoja-Navajas, CEO and founder of LogFire, at the recent CSCMP conference in Philadelphia.

LogFire is a software development and supply chain execution company specializing in SaaS WMS. When their customers started asking if they could also manage inbound and outbound transportation and even putaway in the store, LogFire responded. When talking about extending the DC, it is instructive to look at automotive manufacturing plants where the best ones have very tight (15-minute) delivery windows for inbound trucks carrying the parts that feed the production lines.

They are treating their inbound trucks almost as if they were conveyor belts feeding the lines in the factory. Retailers have been doing something similar, constantly trying to shorten delivery windows and transit times (receipt-to-ship time) through the warehouse/DC. This is especially true in crossdock and flow-through operations, such as in grocery, where freshness is a concern.

Even in other sectors, such as apparel or hard goods, additional speed and precision are being strived for.