Supply Chain Management Group Project Company - Pantaloons Submitted To Dr. Peeyush Pandey In partial fulfillment of the course requirement For Supply Chain Management Submitted by - Group:02 Chandani Kumari - PGP12019 Hardik Chotalia - PGP12051 Shubham kumar Tiwary- PGP12058 Kareliya Shruti Hirenbhai- PGP12071 Soumik Basu Choudhury - PGP12050 Vibhrat Shahi- PGP12122 Table of Contents 1. Introduction 2. Company Background 3. Problem Statement 4. Place and Distribution strategy 5. Brands at Pantaloons 6. Supply Chain Managements process 7. Industry Backgrounds 8. Retail Supply Chain Management 9. Supply Chain Managements & Distribution 10. ERP System 11. Reference Pantaloons Case Study Introduction It was Monday. Ramesh Sinha, Senior Manager, Supply chain division of Pantaloons India, was preparing for a meeting with the Operations division team. The objective of the meeting was to have a discussion on the existing supply chain-related concerns faced by the firm. In the last two consecutive years, there has been a lot of turbulence in the apparel industry due to prolong and inefficient supply chain management. This inefficient supply chain led to long lead times and delayed delivery of apparel to the distributors and retailers. All the major retail players got hit, especially the leading ones such as Pantaloons. The major challenge include inventory management costs to be sorted out. At the present scenario, Pantaloons has 5 regional offices distributed pan idea. The dilemma is whether to continue with the existing decentralised distribution system or going with the Centralised warehouse for inventory management. Company Background The largest retailer in India, Pantaloon Retail (India) Limited, has its headquarters in Mumbai and offers a variety of retail formats for both the value and lifestyle sectors of the Indian consumer market. On October 12, 1987, it was first incorporated as Manz Wear Private Limited. On September 20, 1991, the business was renamed Manz Wear Limited. On September 25, 1992, it became Pantaloon Fashions (India) Limited, and on July 7, 1999, it became Pantaloon Retail (India) Limited. Pantaloons Fashion & Retail Limited is an Indian premium clothing retail chain. In 1997, Kishore Biyani opened the first Pantaloons shop in Gariahat, Kolkata. It is a brand that is owned and managed by ABFRL (Aditya Birla Fashion Retail Ltd). With a broad portfolio of well-known fashion brands, this merger has produced India's largest Fashion and Lifestyle Company. The top 100 Indian brands in terms of consumer trust include Pantaloons. The Indian retail sector is expanding at a robust 6% annual rate and is predicted to reach $865 billion by 2023.With a current market share of $40 billion, apparel has an 8% share of the retail market. Fashionable items are in high demand, and Pantaloons is aiming to capture the fashion apparel market, which is driven by the accessories sector. Pantaloons Place & Distribution Strategy: The distribution plan for the company's marketing mix is as follows: ● Pantaloons provides multi - channel distribution sales. ● They offer a website where customers may place orders for their products online. ● Design decisions for Pantaloons' website were made with e-commerce techniques in mind. ● The items are appropriately differentiated under the headings. Currently, Pantaloons operates 344+ outlets across 170+ towns and cities across the nation. One of the largest retail spaces in India is Pantaloons' 1.7 million square foot property. They have a broad selection and sell more than 100 licenced national and international brands, as well as their own unique house brands. Brands that were available at Pantaloons are:- Pantaloons brand Non-Pantaloons Brands Agile, UMM, Bare Denim, Bare 7 to 14, Chalk, Rig, Mix n match, All, Honey, Calberrys, etc. Biba, 109F, Remanika, Spykar, Lilliput, Lee Cooper, Indus league, etc. Supply Chain Management (Process) Pantaloon supply chain management involves ● planning, ● merchandising sourcing, ● standardization, ● vendor management, ● production, ● logistics, ● quality control, ● control replacement. It's supply chain management provides them flexibility to adapt to changing patterns in consumer behaviour and Pantaloon ability. Industry Background Global The sale of clothing by companies, individual proprietors, and partnerships that produce clothing makes up the apparel market. Clothing manufacturers either knit fabric first, then cut and sew it into a garment, or they cut and sew (i.e., buy fabric then cut and sew to make a garment). The apparel manufacturing industry includes businesses that produce complete lines of ready-to-wear clothing as well as custom clothing, such as apparel contractors who cut or sew on materials that belong to others, jobbers who engage in apparel manufacturing as a business, tailors who create unique garments for specific customers, and businesses that combine knitting with the creation of complete garments, with the exception of knitwear manufacturers. At a compound annual growth rate (CAGR) of 9.8%, the size of the global apparel market is predicted to increase from $551.36 billion in 2021 to $605.4 billion in 2022. At a CAGR of 8.6%, the global clothing market is projected to reach $843.13 billion in 2026. The worldwide clothing market is divided into three categories: 1. By Type: Women's Wear, Men's Wear, and Kids Wear 2. Retail establishments and online retailers 3. By Fiber Type: Man-Made, Cotton, Animal-Based, and Vegetable-Based India In 2022, the apparel market will generate US$87.60 billion in revenue. The market is anticipated to expand by 5.10% yearly (CAGR 2022-2026). Women's Apparel is the market's largest category, with a market value of US$39.51 billion in 2022. Compared to other countries, the United States generates the largest revenue (312 billion US dollars in 2022). In 2022, per-person revenues of US$62.28 are produced based on population statistics. By 2026, the volume in the apparel market is anticipated to reach 37,646.5 million units. In 2023, the volume of the apparel market is predicted to increase by 9.8%. In 2022, it is anticipated that the global apparel market would generate 21.9 items of volume per person on average. By 2022, 99% of apparel market sales will be related to online sales. Major Competitors ● Shoppers Stop. ● Vishal Mega mart. ● Westside. ● Wills Lifestyle. ● Jabong. ● Myntra. ● Shoppers Stop. Problem statement The major challenge include inventory management costs to be sorted out. At the present scenario, Pantaloons has 5 regional offices distributed pan idea. The dilemma is whether to continue with the existing decentralised distribution system or going with the Centralised warehouse for inventory management. Retail Supply Chain Management Retailing Supply Chain is very much prevalent in the Apparel Industry as well and it has some unique characteristics of its own. The retailing companies like Pantaloons, Shoppers Stop, Westside design their Supply Chain Strategy based on these unique characteristics. In the Apparel Industry there is a very wide range of Products and mostly the products have a very short life cycle. In this way, Fashion creates new markets where the trending styles and fashions keeps on changing as the taste and preferences of consumers changes very fast in regards to apparels. These special conditions that fashion creates in the market affect radically the retailing of fashion products and, consequently, the whole fashion retailing supply chain. The most typical characteristics of fashion retailing are: ● Demand Uncertainty Demand for fashion products is very unstable and uncertain and is constantly changing with time.The demand for apparel products is mainly influenced by Lifestyle factors like Trending Fashion, Culture, Music Waves, Films and Celebrity Endorsements. Hence, the preferences of customers tends to change very rapidly in terms of the apparel they want to wear and hence properly estimating the demand becomes of utmost importance. ● Short Life Cycle The Fashion and Apparel Industry is mostly characterized by Short Life Cycles. These products mostly lack a maturity stage and the Decline Stage is very rapid. The products are designed from scratch with the intention to generate maximum amount of Sales in a particular time period which can vary from several seasons, months or even weeks. After the period is over, the demand for such products declines. ● High Volatility The products in this industry don't have a stable demand and the products also have a low life cycle. So it becomes imperative for the manufacturers to produce just the right amount of products so that demand is met and inventory leftover is very low. ● Low Predictability Due to the above characteristics of the Fashion Industry like Short life cycle and High Volatility it becomes really difficult to predict the Demand Forecast for the products. This factor is strongly connected to the previous one, the high volatility of demand for fashion products. Due to this continuously changing market environment, it is rather difficult to predict the exact demand for a specific product during a specific period of time. Retail Supply Chain Management is the process of managing a retail organization's entire supply chain. The volume of product movement and the fast moving nature of retail industry products distinguish retail supply chain management from other supply chain management. In most retailing supply chains, the main players are the Producer, Wholesaler, Retailer and finally Consumers. The main activities that are related to a retailing supply chain include picking, packing, warehousing and transporting. ● High Impulse Purchasing Fashion products are usually bought by the consumers without any formal planning, on the spur of the moment. This is mainly happening because they create to them the feeling of being fashionable, keeping up with the current trends and supporting a modern lifestyle. SUPPLY CHAIN MANAGEMENT & DISTRIBUTION AT PANTALOON The management of materials, information, and finances as they move from supplier to manufacturer to wholesaler to retailer to consumer is known as supply chain management (SCM). Supply chain management entails coordinating and integrating these flows within and between businesses. The ultimate goal of any effective supply chain management system is to reduce inventory. Supply chain management flows can be divided into three main flows: ● The Product Flow The Product Flow includes the movement of raw materials from the supplier to the manufacturer and also the movement of Finished Products from the Manufacturer to the Distributor and then to Wholesaler, Retailer and Finally Customer. Product Flow also includes the returning goods from customer to the retailer or distributor. ● The Information Flow The information flow includes placing of Order, Order Tracking Status and any such information that promotes the Sale of product or movement of product from one player in the supply chain to another. ● The Money Flow The Money Flow consists of the exchange of Cash, Credit and other finances that is exchanged in return of the product sold. An effective supply chain management system can provide a 360 degree feedback to the retailers as well as to the manufacturer about the popularity and complaints of any particular product. Main functions of Supply Chain Management are as follows: 1. Inventory management 2. Distribution management 3. Chann el management 4. Payment management 5. Financial Management 6. Supplier management 7. Transportation management 8. Customer service Management. Pantaloons mainly follows two main types of SCM Software: ● Planning Applications - Supply Chain Planning Applications coordinate assets to optimize the delivery of goods and services, as well as information from supplier to customer, while balancing supply and demand. ● Execution Applications - Supply Chain Execution software applications track the physical status of goods, material management, and financial data involving all parties. Pantaloon Retail believes in value retailing so it is very essential that their supply chain is very strong because they only make money when they reduce their cost and supply chain is the only area for maximum cost reduction either it is purchased in bulk or it is better logistics. They believe that they only win if they are able to decrease cost and response time. DISTRIBUTION SYSTEM ● Pantaloons follows a Zero Level Distribution System since it has more than 30 Private Label Brands and the products are directly delivered to the customers through the Pantaloons Exclusive Retail Stores. ● Brands that are manufactured by Pantaloons are produced at Madura fashion and lifestyle production units, which is a subdivision of Aditya Birla Nuvo Ltd. ● Brands that are not directly owned by Aditya Birla Group or Pantaloons are also directly procured from the manufacturers by the Aditya Birla Group and are delivered directly to the stores across India without any intermediaries involved. ● Pantaloons was acquired by The Aditya Birla Nuvo Limited in 2013 and since then the Logistics of Pantaloons is being handled by the Distribution Management System of Aditya Birla Group where the products are first sent to various warehouses and are further transferred to the respective Pantaloons Stores. ● Currently Pantaloons have their warehouses in Noida as well as in Bangalore. ● These hubs are strategically used to distribute merchandise to maximum stores in India. Pantaloons uses the Hub and Spoke Model to distribute its products to the various stores across the country. ● For Example, For Lucknow, the nearest warehouse is in NCR region. Lucknow Pantaloons outlets get their stocks from this warehouse only. ● The Products are then stored in the Central Distribution Center in the city where the outlets are located and from there it is shipped to all the outlets of the city. ● The stock is mostly transported by road, and the cargos are tightly packed with detailed descriptions of the stock. ● The approximate transport cost by road would be somewhere between Rs 9- Rs 12 per Kilometer. Procedure for goods received from PRILwarehouse/Delivery Center 1. Receipt of goods at store warehouse & security check b: Every morning the Warehouse Incharge prints ZGIT report from the SAP, which offers the info of the products that's scheduled to attain the shop at the identical day. Based at the records the Warehouse incharge to, Allocate area for the in transit products. Allocation of manpower for inwarding tell the respective Department Managers approximately the products scheduled , in order that ground area for the identical may be created, if required Delivery automobile arrives at the shop warehouse. Security employees to obtain the assisting files and surrender the identical to the warehouse employees challenge the inwarding. Document set is checked through warehouse employees to make sure it incorporates a Stock Transfer Note (STN) in reproduction and an outward gate byskip issued through the dispatching warehouse. Security at shops will signal the gate byskip and write guide IRN (Inward Register Number) on gate byskip. 2. Unloading & Recording Merchandise: Unloaders to take away the cartons from the transport car. An H.U. No. - Handling Unit Number (that's a completely unique variety) is pasted on every carton. During unloading, the inwarding body of workers need to mark off every H.U. No. at the STN Independently, the safety employees to preserve a remember of the variety of cartons being unloaded, and the inwarding body of workers to concurrently experiment the HU Number revealed on every carton. Inwarding can't be initiated except all of the H.U. numbers are scanned. When all cartons are unloaded, the Inwarding staffs to test the STN and make sure all cartons marked for transport for the shop were acquired. The variety of cartons for transport to the shop (as indicated withinside the STN) is cross-checked with the remember maintained with the aid of using the safety employees whilst unloading.Security employees to file the inwards withinside the inwarding register (Referto Annexure Details of GRN are left clean at this second and may be stuffed in as soon as the products are inwarded into the system. Security employees to stamp the 2 copies of STN with inward acquired stamp, bringing up the inward variety (consistent with their register),variety of cartons unloaded and date. The Security Personnel need to hold the unique set of files and handover the replica replica of STN to the transport car body of workers. On coming back from the shop, the transport boy will give up all receipted gate byskip and files to despatching warehouse manager/Outward incharge.c. 3. Resealing the vehicle for onward journey: Deliveries in a whole lot of instances visit more than one locations. Hence as soon as unloading at area one is complete; protection employees from area one is to seal the automobile once more with paper seals. A stamp of the shop and signature of protection employees to be recorded at the seal. 4. Inwarding of the consignment: The unloaded cartons to be added to the shop warehouse. The STN governing this consignment is to be invoked withinside the SAP system Each carton`s H.U. no. is displayed through the system. On choosing unique H.U. nos. the contents of the carton are displayed through the system. It may be very vital that Warehouse group of workers opens all cartons and adopt a worldwide matter of the objects contained in every carton. This worldwide matter need to tally with the variety of portions displayed through the system. No carton need to be inwarded with out counting. 5. Scanning the items: The following process is being followed for scanning products through IP Linux system: ● IP Linux is the point of sale system . ● Items inwarded should be recognized by IP Linux ● Inwarding staff should scan each SKU received, at the store warehouse to ascertain if the item is recognized by IP Linux. ● Items recognized by IP Linux. ● Items ready for replenishment . ● If the item exist in the IP Linux proper tagging to be done for thesame (Refer Annexure for tagging standards). ● If items are not recognized by IP Linux - Warehouse staff to keep the article (merchandise) aside. ● Article nos. of the items to be sent to PRIL HO. ● PRIL HO to send idocs for these articles. ● Load the idocs in the IP Linux system. ● Again, scan the items in the IP Linux system on the same date. ● Items ready for replenishment. ERP System used in Pantaloons More than 8 years after it forayed into the retail business, Pantaloon Retail realised that they wanted an IT answer that would assist to combine their operations and assist them to live competitive withinside the hastily developing Indian retail market. Pantaloon became regularly commencing shops in the metros and there became an pressing want for dependable employer extensive utility to assist run its business effectively. Improved monetary monitoring and reporting for all retail locations and enterprise levels deft managing of complexities in retail enterprise requirements enhanced choice making through offering greater granular, real-time Information support for the monetary accounting desires of a unexpectedly expanding retail enterprise expediting the reconciliation and remaining processes The ERP System was developed by SAP for pantaloons. They were used in retail stores and all the warehouse facilities so that there could be seamless communication between all the parties. Some of the characteristics of SAP retail answers are that it helps product development, which consists of ideation, fashion analysis, and collaboration with companions in the deliver chain; sourcing and procurement, which includes running with producers to fulfil orders in step with strategic vending plans and optimise cost, quality, and speed–variables that need to be weighted in a different way as enterprise needs, shopping for plans, and marketplace call for styles change;dealing with the deliver chain, which includes dealing with the logistics of shifting completed items from the supply into shops and overseeing international alternate and procurement requirements; promoting items throughout a kind of channels to customers, which calls for advertising and brand management; dealing with mark-downs and shooting customer reactions, analysing data, and the usage of it to optimise the following segment of the layout process. The software program allows PRIL to correctly forecast the sales. It allows the enterprise to are expecting the reductions to be provided for clearing shares through a sure date.Each branch is split into some sub-departments. Men`s put on, as an example is split into sub-departments: formal put on and informal put on. Each sub-branch is split into diverse categories. For instance formal put on has categories –shirts and trousers.Currently, at the whole, PRIL offers with 12 categories. All IT initiatives/investments are connected to the IT stability scorecard which is connected to the Org BSC. Return on investments (RoI) and TCO (Total costof Ownership) is measured earlier than any main IT investment. As a part of our IT plan, the agency has applied completely included transaction system (SAP) which might collect correct real-time facts as every of the important thing capabilities of the corporation plays their daily operations. We have additionally applied a facts warehouse and a enterprise intelligence tool (of SAP) on pinnacle of the transaction facts collected through the above systems. Therefore, underlying problems lie in customer experience, inventory management in warehouses, perception, communication thread and overall profitability. References 1. https://www.business-standard.com/company/aditya-bir-fas-40912/annual-report/director -report. (n.d.). 2. https://www.business-standard.com/company/future-enterp-2467/information/company-hi story. (n.d.). 3. https://www.mbaskool.com/marketing-mix/services/17278-p