READY-TO-GO EXE FULFILMENT SOLUTIONS FOR MARKS & SPENCER’S ‘LUNCH-TO-GO’ Tuesday 27 February 2001 PDF Print Marks & Spencer have recently introduced their new ‘Lunch-to-Go’ direct delivery service aimed primarily at the corporate market where hassle-free catering – typically for business luncheons, seminars and training courses – is increasingly in demand. The service is available at a number of centres around the UK, but the central London area is the first to benefit from a dedicated fulfilment centre - with order fulfilment courtesy of EXE Technologies’ versatile EXceedTM Warehouse Management System (WMS). The operation cleverly uses the existing supply chain infrastructure in order to maximise the efficiency of direct-from-customer order fulfilment. Heading the project team was Luke Dawe, General Manager Development for BOC Distribution Services in Aldershot, a service partner of M&S for 28 years and one of the leading third party logistics providers in the UK. Dawe attributes much of the success of the M&S implementation to BOC’s comprehensive Project Management methodology, the experience of the EXE project team and the ready-fit flexibility of the EXE EXceed WMS software. The pilot ‘Lunch-to-Go’ project was initiated by M&S to provide hassle-free delivery of food and drinks for corporate luncheons and entertaining. The service is based around single point fulfilment from the Hemel Hempstead Regional Distribution Centre (RDC). ‘Lunch-to-Go’ orders - which must have a minimum value of £25.00 – are accepted up until four o’clock in the afternoon for delivery early the next day. Most orders are placed by busy PA’s or secretaries for delivery to central London or City offices. Orders are placed via the traditional channels of telephone and fax as well as e-mail – a channel which has grown significantly since M&S introduced a CD-ROM for ‘Lunch-to-Go’ users listing about 380 ‘Lunch-to-Go’ items. The CD-ROM allows easy browsing and single click simplicity when ordering items. ‘Lunch-to-Go’ replaces the older Lunch Direct service from M&S. “Previously, four or five London stores were relied on to fulfil these orders from in-store stock. Inevitably this led to unsatisfactory fulfilment with high levels of substitution as the stores had no means of forecasting demand” comments Dawe. The service, launched three years previously, was getting most of the goods to most of their customers, most of the time – not good enough in the new economy age where everybody demands 100 percent fulfilment accuracy. BOC were given the opportunity to take a fresh look at the operation and develop a logistics solution that would ensure high levels of availability and order accuracy, and allow growth of the service. In November last year, BOC were given the green light to begin implementation of a trial ‘Lunch-to-Go’ service based on direct-from-DC fulfilment. “Time and budget limitations meant that we had to develop a tactical solution to this problem,” comments Dawe. “We decided that the best solution was to leverage an existing stores’ allocation / replenishment cycle and fit the operation seamlessly within the existing Marks and Spencer network.” Having established where the inventory was to be sourced, the next task was to build a fulfilment system capable of varying inbound stock with customer orders and managing the physical operation to select and despatch goods. BOC have implemented EXceed in many sites since purchasing a global “licence” in 1997. During these implementations, BOC and EXE have not only developed a wealth of experience in implementing the system, but have developed ‘drop-in’ process templates well suited to this kind of application. “A project team was formed, including IT specialists and operators familiar with EXceed, from within BOC and EXE themselves. By mapping already proven processes and procedures to EXceed standard modules, a solution was designed and delivered in less than 90 days with only minimal modification to the base software,” said Dawe. The new dedicated fulfilment centre covering both ambient and chill items for ‘Lunch-to-Go’ sits within an existing store-replenishment RDC at Hemel Hempstead. To build the ‘Lunch-to-Go’ fulfilment areas, the project team annexed two discreet areas from the chill and ambient stores. They built new racking, offices and developed a full RF infrastructure to cover the site – a particular challenge considering the existing and complex RF system in use within the RDC. A fibre optic hard link was also laid between the chill distribution centre (Hemel 1) and ambient distribution centre (Hemel 2) to ensure real-time stock visibility and control. Both centres use high density shelf racking to allow ease of picking by the operatives. The fulfilment centres are replenished directly from the main store distribution locations at Hemel, so are in effect viewed as just other stores by the M&S network. Both J. Sainsbury in the UK and Wellcome in Hong Kong have also successfully adopted this type of replenishment model, using EXE software “We are piggy-backing the Moorgate stores’ allocation and replenishment and on M&S’s tactical flow system. The system allows us to break out identified Unique Product Codes (UPC’s) so we’ve simply flagged the ‘Lunch-to-Go’ catalogue as one flow, and the rest of the store’s product as another – this way the ‘Lunch-to-Go’ product is segregated from the bulk store picks,” comments Dawe. “The bulk of stock intake – about 70% - comes in to the RDC between 6:00pm and 11:00pm each night. Items are segregated on the dock and scanned directly into the ‘Lunch-to-Go’ fulfilment centre replenishment cycle by EXceed.” “We use a suite of business intelligence tools across the system so we get visibility of what’s coming in and what sales are forecast” continues Dawe. “The bulk of the stock is ambient produce but there is a small amount of cold-chain product too. The stock visibility report is dispatched to the M&S order capturing system on a daily basis.” Stock in hand plus stock en route from suppliers is transmitted to the order capture system operated by specialists EWA. Orders are received and automatically checked against the stock availability information from EXceed. Orders for out of stock items are then able to be substituted on the spot, offering the customer an immediate alternative. “Overall, substitution is at a minimum and so the levels of M&S customer satisfaction have gone up,” says Dawe, “and the EXceed WMS is key to driving this process.” To ensure accuracy in this type of environment, BOC have opted for EXceed to allocate a specific picker in each warehouse to manage each order from start to finish, as opposed to a zonal picking regime found at other EXE sites. BOC have adopted a ‘paperless warehouse’ mentality with all picking instructions issued via handheld RF units directly under system control. The fulfilment centre staff pick directly into totes - a single scan confirming the pick and issuing the next instruction to the picker. Once the orders are picked, the ambient and chill products are merged, packed into M&S carrier bags and allocated to a specific order tote in the delivery vehicle. BOC and EXE have designed the EXceed system and ‘Lunch-to-Go’ solution to be highly scaleable. “Further implementations do not require a massive investment in infrastructure. “ Looking back on the project, Dawe is pleased with the result. “M&S ‘Lunch-to-Go’ is a high profile operation and they’re delighted to have a fulfilment centre in place to service the growing corporate and home shopping markets. We’ve also been able to show just how efficient a properly planned and implemented pick dedicated fulfilment facility can be versus traditional store-based fulfilment.” “A key feature of this project was cost-effectiveness - capitalising on the existing warehouse infrastructure and replenishment cycles. As we progress this solution with M&S we will be able to build further efficiencies and minimise waste.” “Without a doubt, the success of the pilot programme owes much to the combination of BOCDS solution design and to EXE and the EXceed WMS product,” concludes Dawe. “Their joint approach has been extremely professional and co-operative. The EXE project team understood the concepts very well, responded to our requests quickly and efficiently and offered excellent levels of support.” “We’ve been very pleased with the ongoing commitment of EXE to finding the right solutions and are encouraged by their enthusiasm for further eGrocery ventures.” To find out more about EXE solutions for 3PL and retail, contact Louise_Henham@exe.com or telephone +44 (0) 1344 420 144. Ends About EXE Technologies : EXE Technologies, Inc. is a leading provider of fulfillment, warehousing and distribution software for e-commerce and traditional distribution channels. EXE's software allows companies to use the Internet and traditional communication methods to efficiently manage and control the flow of inventory throughout the supply chain. Companies use EXE's software to reduce distribution costs and increase customer loyalty and satisfaction. EXE provides global service and support for its software from established facilities in North America, Europe, the Middle East, Asia and Australia. EXE Technologies, EXE and EXceed are trademarks, registered trademarks or service marks of EXE Technologies, Inc. in the United States and/or other countries. All other trademarks or service marks contained herein are the properties of their respective owners. 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