Lining Creates Supply Chain IT Information System

Production of computers and production shoes Is it the same thing?

Deng Hongbing, vice president and chief supply chain officer of Li Ning Co, looks both alike. Deng has been in charge of supply chain management for 14 years at DELL company. Now he is trying to transform Lining with IT industry knowledge to promote its retail transformation and realize the intensive, rapid and flexible supply chain.

Over the past two years, the domestic sporting goods industry has been tired by heavy inventories. One of the crux of the problem lies in the wholesale sales mode of extensive operation. Deng Hongbing described the traditional business practice: 18 months ahead of schedule, planning the future selling styles, holding orders, obtaining orders, organizing production to fulfill orders delivery, "after completing business calculations, we went directly to the HKEx to report on sales performance." Products with high homogeneity, large volume and low cost impact on the market, that is, a large number of goods are backlog in the channel, high inventory, and can only be dealt with at a discount.

Similar to the extensive operation mode of sporting goods industry, it is unthinkable in today's IT industry. "IT industry costs huge, raw material prices are high, replacement is very fast, technology is outdated, and no sales discount, no need to pay, also have to spend money to ask the company to help deal with, otherwise the state will be prosecuted for polluting the environment." In Deng Hongbing's view, the IT industry with high speed and iterative demand has been shaped by demand pull supply chain for more than 10 years, and Li Ningzheng can learn from it.

How can we accurately capture market demand and sales information to achieve rapid response in the supply chain?

As the first fully transformed company, Li Ning Co began to bid farewell to the traditional ordering form at the end of 2012, and adopted the retail mode featuring "guided orders, orders and quick replenishment + quick response" to effectively improve the dealer's order guidance and goods arrangement. On the basis of retaining the original order mode, Lining upgraded the enterprise planning system and market data analysis system, and launched the rapid reaction product line and the best SKU combination product based on the two.

Take the "quick response" product as an example, the product that might have been on the normal listing cycle will now add 2-4 months to the test period and the real listing period. "We only do a small amount of distribution in advance, we test the market reaction in two weeks or so, and monitor the sales volume anytime and anywhere. Once the product is sold well, we organize the production of mass production quickly, and if the sales are not good enough, we will reduce or even suspend the production of orders." According to Deng Hongbing, the manufacturing cost of shoes and garments is 70% and 30% respectively. "At least 30% of labor cost will not be wasted, and raw materials will be more conducive to maintaining value."

Since the implementation of the change plan, Lining has launched a number of quick response products, such as basketball shoes, Zheng Rong 92 casual shoes, legendary 84 vulcanized shoes and so on. In 2013, sales of the "quick response" product line is expected to account for 10% of the business revenue. Deng Hongbing personally expects that the proportion will increase to more than 20% in 2014. "This business mode is very difficult to lose money. Why? Because the market response is very small, and the selling rate of products is very high."

However, the meticulous operation mode has raised higher requirements for data collection, data analysis and internal collaboration. Therefore, Lining spent a lot of resources and energy to build a supply chain basic platform.

The collection of basic data is not complex in theory. In general, POS is placed on every sale terminal, and POS is connected to the headquarters to achieve data aggregation. However, the execution process is very trivial. Especially when the stores go deep into three or four line cities or even townships, some distributors may be husband and wife shops, and mobilizing them to spend four thousand or five thousand yuan to install POS machines is not easy. Lining uses incentives, store demonstrations and other means to encourage distributors to report data. Lining terminal store POS coverage has reached about 85%.

Data analysis is needed for realtime sales data (including category, style, color, etc.). As early as the beginning of this year, Lining began data analysis and explored and solidified business processes in the form of outsourcing. Now, dozens of data analysis teams have been set up in Lining (Jingmen) logistics park group. After analyzing the market data of different regions, the distributors can recommend the best SKU combination products to the distributors in this area, so that the product mix is more in line with local consumption habits, so that the sales of distributors can be more smoothly.

The new supply chain operation mode is also promoting the transformation of the foundries. Hubei kinetic energy sporting goods Co., Ltd. is Lining. clothing According to Huang Yongbiao, chairman of the supplier, "in the past, we opened an order to Lining, which is ten thousand pieces. Now we are developing towards small batch, multi frequency and short delivery period. Orders can be produced in 500 batches." In order to improve the response speed, kinetic energy sports this year specially set up a "cell production" workshop, waiting for additional orders at any time, the fastest seven days can be delivered, for some hot money can replenish the supply.

According to Deng Hongbing, before the first half of 2014, focusing on improving demand forecasting, product mix, supplier collaboration and store operation, Lining will build a complete IT system to realize the all-round creation of the IT platform, and make the sales and supply chain more collaborative. All work will make the collection and transmission of internal data more timely and accurate. Taking store operation as an example, it involves the distribution of goods, replenishment, transfer of goods, distribution, return and replacement, and the work is complicated. The turnover rate of salesmen in traditional stores is high. If there is a lack of a IT system to manage, it will not only have a comprehensive grasp of terminal sales, but ultimately affect the efficiency of the supply chain.

Once the IT information system is completed, Lining The supply chain will regenerate and help the company return to its peak in a short time. " Deng Hongbing is confident that he will copy the experience of IT industry to the sporting goods industry.