(Photo courtesy of Ruffwear)
In an effort to create a nimble and responsive supply chain, Ruffwear has achieved a 30-day manufacturing lead time (from purchase order to leaving the factory) on its bestselling product, the Front Range® Harness. By leveraging long-term relationships with vendors and manufacturers, and investing its own dollars and time into the newly developed system, the brand says it has reduced waste and improved cash flow by shrinking the amount of inventory it keeps on hand at any moment by 50 percent. Yet even with fewer harnesses in the warehouse, the company has been able to reliably supply customers on demand.
“We are building products at a much closer rate to actual demand with the 30-day production lead time, and are keeping total supply chain costs low,” said Young Joen, Director of Product Commercialization for Ruffwear. “We couldn’t have done this without the willingness of our vendors and manufacturing partners to learn a completely new way of approaching the process. Ruffwear invested the money up-front to get the program started and has been onsite creating, training and implementing the new system. It has truly been a team effort and we couldn’t be happier with the results.”
Benefits of 30-day manufacturing lead time include:
• Reduces the outdoor industry standard time of 90+ days from purchase order to
leaving the factory.
• Financially easier on retailers because of the high in-stock level.
• Financially easier for the manufacturer as it requires less cash to support the order
cycle and growth.
• Shortens duration of potential product out-of-stock time if demand gets too high
because of more frequent orders with shorter lead times.
• Minimizes waste of materials because you’re not guessing on colors/sizes/#’s.
Ordering just what you need when you need it.
• Minimizes storage of materials and saves on manpower that would be managing the
storage, ordering from multiple vendors, etc.
• Minimizes quality risk by having manufacturing process flow from beginning to end.
• More accurate cost data of manufacturing.
• Easier to manage end-of-life product cycle.
Ruffwear is not alone at re-thinking the manufacturing process. Not only does it benefit the brand, but it also benefits retailers. According to a recent Reuters article on MSN, “Traditionally, retailers lock in most of their purchases nine months to a year in advance.
This year (2017), retailers started placing a large portion of their holiday orders three to four months before the holiday season, and are refreshing fast-selling items within as little as six to eight weeks, vendors and consultants said.”
“’We definitely are buying closer in… to make sure we have the right goods in time for holiday, but not too far in advance,’ said Macy’s Chief Executive Jeff Gennette.”
“'(Retailers) simply don’t want to be stuck with excess stock. It takes up working capital and that was okay when times were good but not when things are this tough,’ said Neil Stern, partner at McMillan Doolittle, a consultancy who works with retailers including department stores.”
Ruffwear’s first product to successfully achieve a 30-day manufacturing lead time was the top-selling Front Range® Harness. In December, Ruffwear initiated a commitment with a second factory for all collars and leashes. The brand’s goal is to integrate the 30-day manufacturing lead time for all viable products.
“We understand that the retail landscape is changing,” said Joen, “and brick and mortar stores need to be more creative and nimble. By getting rid of the antiquated pre-season ordering system and allowing retailers to make smaller, more frequent orders, they can more quickly react to consumer trends, demand and seasonal shifts. If winter doesn’t come to their area, for example, they aren’t stuck with 50 puffy coats they can’t sell.”
