Red Wing Shoe Company is a leading purpose-built footwear company specializing in work and outdoor products that can stand up to conditions around the world.
Red Wing needed a better forecast to more efficiently position inventory, improve the Sales Inventory Operations Planning (SIOP) process and to collaborate with its suppliers more effectively.
It was difficult to work with global suppliers and partners using spreadsheets for end-to-end planning.
Red Wing Shoes’ forecasts were managed at the style level, but significantly degraded at the style-gender-size level.
Key suppliers were dependent on visibility of future demand to balance capacity planning and scheduling but skepticism caused them to modify production to reflect their opinion of the appropriate SKU level mix.
Lower fill rates
As a result of lower supplier service levels, Red Wing suffered lower customer fill rates.
Red Wing Shoe Company Embraces S&OP
Red Wing Shoes invested in its supply chain people, process and technology, including APICS certification as well as implementing the Logility® Digital Supply Chain Platform. Only four months after launching Logility, Red Wing, along with its suppliers and retailers, began reaping benefits based on more detailed and accurate information, increased visibility and better service.
“We are embracing rapidly changing consumer purchasing behaviors by delivering multi-channel commerce across all channels and improving our end-to-end supply chain planning capabilities with Logility,” said Red Wing Shoes’ senior vice president of supply chain.
Red Wing Shoes has moved into the forefront of information sharing with suppliers, who now boast they have real-time access to “the best information we’ve ever had.” Even suppliers with limited technology experience have been thrilled with the new level of visibility, ease-of-use and accuracy.
Red Wing has been able to provide suppliers with a synchronized demand and supply plan each month, allowing them to drill down to actual SKU-level demand in real-time, over a 12-month rolling horizon. The collaboration with global distributors has helped planners understand order patterns across more than 110 international markets and create more accurate global consolidated demand plans. With more effective level-loading between suppliers, Red Wing can pull demand in or push production out with confidence. Planners have better visibility to upcoming retail promotions, and access to comprehensive demand history data giving them confidence in making forward-facing decisions.
The planner-buyer collaboration on new product launches results in products getting to market on time and on target for Red Wing. Scorecards of forecast accuracy in monthly SIOP meetings show service levels have improved tangibly. Now, retailers experience more full-order replenishments and on-time deliveries. With supply chain visibility and execution dramatically improved, it is fair to say that Logility has transformed Red Wing’s supply chain performance. “Our deployment of Logility has enabled us to significantly accelerate our SIOP process which has been instrumental in aligning our corporate goals and strategy across brands and functional areas,” says the senior vice president. “Our key focus strategies include strong matrix teams to ensure business alignment, organization aligned goals and strategies, and clear direction on what we are working on.”
Following the implementation of Logility, Red Wing Shoe’s forward visibility expanded to 18 months of demand, publishing 12 months to suppliers for collaborative planning. Red Wing has achieved tangible results across the organization from this initiative. Red Wing reduced inventory across the network by 27% while increasing customer fill rates by 8% to 10%. Forecast accuracy improved by 30%, based on weighted mean absolute percentage error (WMAPE) and lead times have been shortened by an impressive 30%. Along with these significant results, Red Wing has been able to more effectively manage its SIOP process and with Logility, the SIOP process time was cut in half.