Merchandise and Replenishment Planning Optimisation for Fashion Retail

Abstract

The integration among different companies functions, collaborative planning and the elaboration of focused distribution plans are critical to the success of each kind of company working in the complex retail sector. In this contest, the present work proposes the description of a model able to support coordinated strategic choices continually made by Supply Chain (SC) actors. The final objective is achievement of the full optimisation of Merchandise & Replenishment Planning phases, identifying the right replenishment quantities and periods. To test the proposed model's effectiveness, it was applied to an important Italian fashion company in the complex field of fast-fashion, a sector in which promptness is a main competitive leverage and, therefore, the planning cannot exclude the time variable. The passage from a total push strategy, currently used by the company, to a push-pull one, suggested by the model, allowed us not only to estimate a reduction in goods quantities to purchase at the beginning of a sales period (with considerable economic savings), but also elaborate a focused replenishment plan that permits reduction and optimisation of departures from network warehouses to Points of Sale (POS).