Bcs Big China Store

Developed by George Zhou

Modern retailing entered China in the mid"1990s through international retailers such as Wal-Mart and Carrefour. The Big China Store (BCS) group operates in the competitive retailing market of greater Beijing, the capital city of China. The retailer has 70 convenience stores and 710 suppliers providing approximately 8000 major SKUs from an authorised product selection list of 32000 SKUs.

Currently, most suppliers make direct deliveries (using their own vehicles or a transport service

provider) to the stores, which independently order their own resupply.

Table, summarises the current seasonality of sales for BCS.

Table 2 identifies the major SKU profile (20 per cent ofSKUs that contribute 80 per cent of sales).

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

12·3

Fresh Frozen/daily Food Candy jliquor jdrinks HBA

Houseware Major jelectrical

NjA

65 0

'700 135 0 1500

6 '4 19 20 22 5 8

1).) 5·9 7·0 8.0 5·9 5·9 5·9

10.0

800 600 4 00

1000 8000

Office supply

Apparel/domestic

5 100

8·9 6·9

10.0 100.0

Total

BCS is planning further expansion to double the number of stores. To ensure success and enable control of this expansion, BCS will centralise the business. Buying of retail products will be conducted from head office and storage and distribution will be contracted to a specialist distribution services

provider ()PL).

The initial challenge for BCS is to select a suitable 3PL, because there is little expertise in the company concerning the establishment and operation of a retail distribution centre (DC). The project will be a turn-key project which includes:

*» initial requirements design and planning.

$)

site selection.

II DC layout.

0.

DC equipment purchasing. project planning and execution . transport companies and working within local industry practice and 'bad' habits.

Lott Global (Lott), a major international logistics service provider (LSP), has been selected as the...