Holt Renfrew

Executive summary

Assigned as the new director of logistics in Holt Renfrew (HR), the leading Canadian luxury retailer based in Toronto, Tony Kelly is responsible for preparing a detailed inventory management plan to improve the efficiency of supply chain and profitability of the company. In order to come up with a strategic plan, Tony should first identify the causes of the problems which hinder the working efficiency and then come up with alternative solutions and strategic implementation plans.

Currently, the inefficiency of HR’s logistics function is the main problem that increases the level of stock out. Other issues like merchandise placement and supplier coordination also hinder the effectiveness of the inventory process. With regard to these problems, we put forward several suggestions and give out our implementation plan.

We believe that HR can improve the inventory management and supply chain by conducting a justified plan including establishing documentation working procedures with suppliers and decreasing the stock keeping units to a reasonable level. Besides, inventory classification, technology adoption and tracking system establishment can lead to process flow improvement and warehousing operation efficiency.

Generally speaking, we recommend HR close the secondary warehouse and reorganize the layout of DC to release the current issues and promote the company’s profitability.

Background and current situation

Founded in 1837 in Quebec City, Holt Renfrew(HR), owned by the Wittington Group, has become the leading Canadian high-end retailer specialized in providing private-label designer fashions, high-end cosmetics, and luxury brands with top quality catering to wealthy consumers. The company operates altogether ten stores covering seven Canadian cities. HR promotes products by utilizing various publicity campaigns throughout the year. On average, HR receives 21500 orders on a yearly basis. Besides, each season HR will introduce new merchandise...