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Since 2005, the famous American brand Levi Strauss & Co. has begun to manage its inventory reasonably and accurately, so as to realize the efficient operation of inventory management as much as possible. To this end, Levi’s established an ad hoc working group composed of multiple departments such as system structure management, sales, and IT management to conduct in-depth research on the status quo of its supply chain, hoping to adopt EPC/RFIDTechnology improves its inventory management, thereby increasing the overall efficiency of the supply chain.
The survey found that: the inventory in the store is 4 months or more; the mismatch and inconsistency between the manually calculated inventory and the system calculated inventory is as high as 20%; there are uncompleted or incorrect orders; the purchase of unnecessary products, This leads to low inventory turnover and excess inventory; the inventory report lacks specific product model and color information; sales do not match expectations of high inventory.
Levi’s has strong operational capabilities in Mexico, so he chose to carry out a pilot project in Mexico, hoping to reduce inventory for up to 2 months and reduce the percentage of out-of-stock; EPC/RFID technology is used to accurately manage the replenishment process, increase sales, and operate. DC (distribution center) fully adopts EPC/RFID technology; EPC/RFID technology is adopted in the links of goods loading, sales, return, exchange and inventory management. Through the integration of EPC/RFID technology, it is found that the inventory has been reduced from the previous 4 months to 2 months; the manual and system comparison of the shelf inventory in the store has increased the accuracy to 99%; more complete and specific inventory information can be obtained; Sales increased by 11 percentage points; improved consumer purchasing experience; reduced sales caused by reduction in stocks reduced by 40%; improved supply chain efficiency through fully automated replenishment; improved inventory work accuracy; reduced transportation costs , Especially the “waiting time”; the efficiency of DC is significantly improved.
At present, Levi’s is beginning to apply EPC/RFID technology to its production lines, such as: production plants, DCs and stores. Especially attach a unique EPC/RFID tag to each product and commodity, so as to achieve efficient operation and traceability from the production link of the supply chain to the sales link of the store.
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