Eleven New Business Opportunities: Improving Supporting Logistics

"Midwest to undertake coastal areas"

In this regard, the Li Ning Co approach can serve as a template.

At a Li Ning Co tender, all of the famous large logistics companies came to the scene. They were eager to find out the weak links of Li Ning Co's logistics and seize business opportunities.

But when they saw the logistics cost of Li Ning Co, the enthusiasm suddenly vanished and was disappointed.

Li Ning Co's former director of logistics, Xun Wei, once had a figurative metaphor: "meticulously compiled".

In 2000, Li Ning Co was the busiest year, and the difficult moves were too busy.

Sell convoys, rearrange the logistics system, implement SAP's R/3 system and AFS (clothing / Footwear solutions).

This series of actions is to get through every joint of Li Ning Co, make its logistics smooth, and information pmission is fast and efficient.

The sales logistics of all products of Li Ning Co is operated by its logistics department, including footwear from factory to store, and clothing distribution from distribution center to store.

After the product is put into storage, it will be arranged by the logistics department.

First of all, products entering the warehouse must be "identified". If they meet the requirements of receipt, they will be confirmed in a SAP system based on a pre purchase purchase order.

An example can be used to clarify the process more clearly: if the purchase order indicates that the quantity is 1 million pairs of shoes, and the warehouse enters 150 thousand pairs, then confirm the 150 thousand first.

After confirmation, the sales department's computers immediately showed that these products were already in storage.

Then, the sales department will deliver the goods list. The logistics department will choose the new products according to the delivery orders, and then send them to all parts of the country through the trunk carriers and agents.

Lining has thousands of stores in the country, and products come out of warehouses. Most of them go to the distribution center of the branch or the warehouse of the dealer, and a small part is sent directly to the store (a small dealer may have only one store, no warehouse).

Although it is always silent about its logistics cost, Li Ning Co has always been reluctant to disclose to people for shorter allocation time.

Lining's product logistics allocation time, that is, the national allocation time is 4.5 days, compared with the famous Haier logistics in the industry, which is less than half a day. Compared with the international famous brand Nike's 7 days logistics distribution time in China, Lining is leading a lot.

It is commendable that not only the large logistics of the company's products operate in accordance with the standardized process, but also the specific distribution service to a certain area. The Li Ning Co also has its own set of standard logistics service agreements as guidance.

Take Beijing as an example, the products of Beijing's Li Ning Co are distributed by the Li Ning Co logistics department.

Distribution centers distribute goods according to the needs of different stores, and send them several times a week, and what goods they deliver each time, they are all written into the agreement.

This is actually an internal logistics service agreement. As an internal customer, the franchised store regards the distribution center as a logistics service company, and requests the standards of the logistics company at the service level.

In the company's view, this avoids a lot of trouble.

A store knows how long it takes to distribute goods, and knows what kind of goods can place orders.

Moreover, the trouble of uneven distribution of goods between shops and shops is greatly reduced.

For their own logistics system, the company believes that as long as it is practical and hard, even if the logistics is handed over to others, it can also guarantee the quality.

However, many domestic clothing and footwear manufacturers are having low efficiency and poor quality for logistics and pportation services, but Li Ning Co has already had a knack for effective control of pport enterprises.

The first is the selection of logistics companies: do not find the biggest ones but the best ones.

Many domestic shippers are superstitious in large logistics companies, but do not consider whether they are suitable for themselves.

In this regard, Li Ning Co has its own understanding.

The logistics providers selected by Lining are some medium-sized logistics companies or pport companies. This is the experience that has been explored from many previous cooperation.

In fact, when initially began to choose carriers, Li Ning Co most valued the scale.

However, with the deepening of cooperation, the Logistics Department of the company gradually found that the carriers with large scale not only had high cost, but also weakened management because of many grades.

Moreover, the proportion of Lining's goods often can not occupy an absolute advantage, and the degree of attention is far from the company's expectations.

Later, Lining began to choose some medium-sized logistics and pportation companies as partners, and the situation has been greatly improved.

Lining's goods are highly valued, and the logistics companies do their best in services. The Li Ning Co took the opportunity to add one to the logistics contract: no matter what the situation is, Li Ning Co's goods are first issued.

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Choosing a carrier by bidding is not the secret recipe of Li Ning Co, but the reasonable process of bidding is good at Li Ning Co.

Li Ning Co holds one or two tenders for carriers every year. "We can not really control the process, and bidding will become a mere formality."

In recent years, since the successful bidder has done a good job, in addition to the elimination of subsidy, Li Ning Co's bidding for bidding has been relatively small.

After all, replacing carriers is a painful route for Lining, who is running fast.

In fact, there are about 10 major carriers co operating with Lining, which are divided into two categories: one is the dedicated line carrier, the other is the logistics company.

If the cargo volume is large, the Li Ning Co will manage the conductor by itself. If the volume is not large or the capacity of the carrier is not enough, then a professional logistics company will be appointed as the agent. There are also some carriers under the agent to cope with the different markets of Lining.

If the first two points are Li Ning Co's control of pport from a macro perspective, the performance appraisal, elimination and tracking control of carriers are microcosmic.

Logistics pportation is often used to describe "no matter what happens outside the company," but in Li Ning Co, it doesn't work at all.

Both carriers and logistics agents must accept Li Ning Co's strict performance appraisal.

The company has 5 assessment indexes: punctual delivery rate, punctual punctuality rate, loss rate of goods loss, service attitude and perfect return rate.

For the dedicated carrier, Lining logistics department will personally monitor the completion of each indicator, while the overall evaluation of the agent company.

All logistics carriers should link their information management system with Li Ning Co Logistics Department, and timely feedback the pport monitoring information.

They must report daily, including the order number, delivery time, delivery time, pit time, reports in different locations during long-distance pportation and accident analysis.

At the same time, Li Ning Co has a dedicated pport tracking department, responsible for telephone tracking dealers, stores, and their own information and carrier feedback data unified analysis, forming a carrier in a month's programming.

Referring to these programming, the company will mark the carrier every month, concentrate on each quarterly, publish the data report to the carrier, and make rectification according to its shortage.

Relying on this strict final elimination system, the carrier's service level is constantly improving.

The carriers who work with Li Ning Co now have not only tender finalists but also those who have been eliminated to improve their own level, so that they are once again recognized by Lining.

Li Ning Co's cargo pportation has been widely praised in the industry, and has won the trust of the vast majority of dealers. As long as the goods arrive, the goods will arrive safely and punctually.

To improve logistics efficiency, besides pportation, warehousing and distribution center construction is also a problem before Li Ning Co logistics department. What the company is considering is how to find a balance between safety stock and storage cost. In the face of scattered production and consumption, how to layout the distribution center, how the product styles and models are increasing, and how to improve the picking time.

Li Ning Co has two first class distribution centers in the whole country, one located in five li store in Beijing, with a total area of 25000 square meters, which is responsible for the northern part of the Yangtze River. The other is Guangdong Sanshui, with a total area of 12000 square meters, which is responsible for the south of the Yangtze River.

There are 13 branches in the country, each of which is a two or three level distribution center with a total storage area of 50000 square meters.

In order to concentrate on the advantages of the network to promote sales, Li Ning Co integrated the logistics and storage department of the 13 branches of the country, set up a logistics center for unified management, and implemented the practice of placing in place according to the place of sale. After the product was released, it was sent directly to the distribution center of the corresponding sales place, and then distributed through the sorting department.

Instead of going through the production warehouse before entering the distribution center.

After the establishment of the network, zero inventory has become another challenge for the company. Xun Wei has spoken frankly: "zero inventory is the dream of every enterprise, and we are always pursuing it, but we can not achieve it in the short term."

However, Li Ning Co has suggested that the reduction of inventory must have a certain amount of storage under the premise of ensuring safe stock.

At present, the distribution of door to door can not be fully realized, and dealers and franchised stores can not be charged with the responsibility of warehousing.

If there are sales outlets in the one or two neighbourhood of the central city, no additional storage will be allowed.

In addition, the city's control of pportation also makes it impossible for large vehicles to be directly distributed to stores within a specified period of time.

Therefore, Lining can control the time and inventory within the controllable range, aiming at immediate production, raw materials and finished products.

From the internal design of the warehouse, we can see that Li Ning Co has a good intention to improve the efficiency of logistics.

Although Lining has many logistics indicators that have reached and exceeded the professional third party logistics company, Li Ning Co has found a shortcoming, that is, the time of goods picking up is still inferior to that of the third party logistics companies.

To this end, Lining devoted a lot of money to the pformation of warehouses, and attaches great importance to details.

For example, in order to choose the right shelves, the relevant personnel almost inspected all shelf types.

They first carried out EIQ (attribute analysis) to the goods, and then invited 5 shelves manufacturers to make different plans according to the attributes of the goods.

This makes Li Ning Co famous for its high frequency of launching new products in the domestic market, no longer as it used to be, because 20 thousand different styles and color codes of clothing shoes and hats make it difficult to check goods.

In the distribution center of Li Ning Co in Beijing, we can see that different shelves are arranged in different order according to different delivery needs and goods attributes.

Lining once said: do not become China's Nike, be the world's Lining.

To achieve "the world's Lining", besides the excellent products, logistical guarantee is the key.

Logistics strategy is to serve sales. The layout and process design of distribution center must reflect the market demand as quickly as possible, eliminate problems in the shortest possible time, and serve the market through the Sales Department of internal customers. These are Li Ning Co's understanding of logistics.