Alice CAMPORESICamille DANNEAUXQian HUAISam MURRYClaire PAVIS D’ESCURACSuxin YANG
04/18/2023 LV Supply Chain Project – Group H 2
ZERO WASTE
VISION
SPACE
RECYCLE
MATERIAL
ENERGY
CREATIVE
RESOURCES
MONEY
PRODUCT
RE-USE
TIME
04/18/2023 LV Supply Chain Project – Group H 3
STRATEGIC PRIORITIES AND KPI
OTHER STRATEGIC DIMENSIONS
• Eco-sustainability (carbon footprint)
• Predictable risk management
• Flexibility
OUR TOP 3 STRATEGIC PRIORITIES
1. Operational ExcellencePrevent product waste (obsolete stocks)Minimize inventory levelsAchieve economies of scale
2. Product ExcellenceThe right product at the right time for the right customer
3. Service ExcellenceHow quickly and efficiently do we deliver to stores and to customers ?
OUR TOP THREE KPI
• Warehousing and transportation costs (1)
• Order fulfillment lead time (2, 3)
• Achieve obsolete inventory level < 5% (1, 2)
04/18/2023 LV Supply Chain Project – Group H
SUPPLY CHAIN PROCESS 1
• Only European Suppliers + crocodile leather from SG
• One Supplier per raw material type - Example: one for all leathered goods.
• Re-definition of replenishment cycle time according to new inventory management.
• Preventative measures performed: physical inspection of the goods before dispatching in order to avoid reverse shipment.
• When possible, ship directly to specific workshops.
• Cycle stock : order time replenishment based on production lead time and sales forecasting.
• Certification management - CITES for customs.
• Manufacture products but create first packaging step once manufactured.
• Organize Gembai walk and explore the possibility of Six-Sigma Methodology.
• Investigate through Gembai walk any kind of raw material waste.
• Replace light bulbs by LED.
• Labelling, reduce packaging, assembling etc.
• More seasonal products at FTWZ to avoid possibility of reverse shipment but to still be able to quickly send the goods.
• Transportation choices
- Bundle AFR shipments with other brands (next slide)
- Increase Rail / Road Freight solutions
- Increase OFR by better planning demand
• Store managers set up their own seasonal products sales target, consequently determining their seasonal stock.
• We hope it will increase their commitment to sell the seasonal products.
• Stores that will not manage to meet their own target for seasonal products sales will be charged the overstock.
• Reduce final packaging.
Workshop
Eole Warehouse ( for raw
materials)
Regional Warehouses
Retail Stores
Suppliers
4
Process alignment with integrated IS solutions.
04/18/2023 LV Supply Chain Project – Group H 5
SUPPLY CHAIN PROCESS 2
Brand selection criteria : • Offer high-end leather goods• Have some workshops in France, Italy &
Spain• Share similar supply chain (workshops
→ central warehouse → regional warehouse → stores)
Workshop
Central Warehouse
Regional Warehouse
Stores
ONLINE LOGISTIC PLATFORM
Brand Analysis in LVMH Fashion Group DivisionTargeted brands
:
• Berluti• Celine• Fendi• Givenchy• Loewe
• Sharing of logistic resources among all the decoupling points• Enable more frequent deliveries with small batches of goods• Easy to implement and to be integrated into current system• Facilitate communication between brands
Brands Logistics Bundling A Further Step of
BundlingTo envision bundling with LVMH Group Brands from other Product categories such as Perfumes and Cosmetics and Wine and Spirits in order to take advantage of the weight-volume cost calculation by carriers
04/18/2023 LV Supply Chain Project – Group H 7
SUPPLY CHAIN SETUP
California
New Jersey
Cergy (France)▪ Global
warehouse▪ Europe
warehouse
Dubai
Singapore
Hong Kong
Shanghai
Osaka
Tokyo
Spain▪ Leather goods
(3)▪ Leather good
accessories
Romania▪ Shoes and
leathergoods components (2)
California▪ Leather goods
(2)
France▪ Leather goods
(12)▪ High jewellery
Ponte de Lima▪ Shoes and
leathergoods components
LV Warehouses
LV Workshops
Key:
LV Tanneries
Belgium▪ Vegetal
tanned leathers
Singapore▪ Crocodile
leather
Italia▪ Shoes (4)▪ Accessorie
s
Switzerland▪ Luxury Watch
manufacture▪ Watch
assembly
Valence (France)▪ Calfslkin and
young bull hides
North Am.
▪124 stores
Latin America
▪19 stores
Europe
▪109 stores
Japan
▪57 storesChina
▪54 stores
Asia / Pacific
▪84 storesAfrica
▪4 stores
Middle East
▪19 storesMiami
Perm : 30%Ssnal : 70&
Chennai 60%
Seasonal