World Co Case1
Supply Chain
Optimization:
The Case of World Co. Ltd.
Diane Floresca
Nidhi Ghurka
Michael Sable
The World of World Co.
Ltd.
Vertically-integrated retailer of Japanese women’s apparel—designs; produces; and ships the product
Headquartered in Kobe, the fashion capital of Japan
Established in January 1959 as a clothing wholesaler specializing in knit garments. 40 distinctly targeted brands in 7,000 shops. 3.5% of apparel market.
$1.8 billion in net sales and $32 million in net income for fiscal year ending March 31, 2000
Key Brand: Untitled. Target Market: Females (25-29 yrs. of age). Avg. annual store sales: 1.8 million
Japanese Women’s Apparel
Industry
1)
2)
3)
Products have short lifecycles and extremely uncertain demand as elsewhere in the world.
Japanese retail stores carry less display inventory to impart a sense of uniqueness. Less variety due to homogenous population and less climate change
3 different retail formats for a vendor:
Company-owned stand-alone stores
Shops in fashion malls (Sales Staff are Vendors)
Shops within department stores (Dept. Store received substantial—up to 40%--of retail sales generated at the store without inventory risk. Location key to sales so department stores dictated terms to vendors. )
The Problem
Speed and Responsiveness to market conditions are essential to World Co.’s survival in this highly competitive industry.
Hidezo Terai, the President of World Co., emphasized monitoring sales trends and consumer demand to deliver right product to right store at right time to maximize profitability. The Solution
To coordinate product planning, development, production, and marketing among SPA (Specialty store Private-label Apparel) brands, Terai championed the SPARCS (Super, Production,
Apparel, Retail, Consumer Satisfaction) supply chain management system that had been introduced in January 1992.
SPARCS is essentially IT for real-time demand information.
It affects:
a) How much to make
b)
Optimization:
The Case of World Co. Ltd.
Diane Floresca
Nidhi Ghurka
Michael Sable
The World of World Co.
Ltd.
Vertically-integrated retailer of Japanese women’s apparel—designs; produces; and ships the product
Headquartered in Kobe, the fashion capital of Japan
Established in January 1959 as a clothing wholesaler specializing in knit garments. 40 distinctly targeted brands in 7,000 shops. 3.5% of apparel market.
$1.8 billion in net sales and $32 million in net income for fiscal year ending March 31, 2000
Key Brand: Untitled. Target Market: Females (25-29 yrs. of age). Avg. annual store sales: 1.8 million
Japanese Women’s Apparel
Industry
1)
2)
3)
Products have short lifecycles and extremely uncertain demand as elsewhere in the world.
Japanese retail stores carry less display inventory to impart a sense of uniqueness. Less variety due to homogenous population and less climate change
3 different retail formats for a vendor:
Company-owned stand-alone stores
Shops in fashion malls (Sales Staff are Vendors)
Shops within department stores (Dept. Store received substantial—up to 40%--of retail sales generated at the store without inventory risk. Location key to sales so department stores dictated terms to vendors. )
The Problem
Speed and Responsiveness to market conditions are essential to World Co.’s survival in this highly competitive industry.
Hidezo Terai, the President of World Co., emphasized monitoring sales trends and consumer demand to deliver right product to right store at right time to maximize profitability. The Solution
To coordinate product planning, development, production, and marketing among SPA (Specialty store Private-label Apparel) brands, Terai championed the SPARCS (Super, Production,
Apparel, Retail, Consumer Satisfaction) supply chain management system that had been introduced in January 1992.
SPARCS is essentially IT for real-time demand information.
It affects:
a) How much to make
b)