Improving stock accuracy

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Value retailer Poundstretcher, part of the Brown and Jackson Group, has more than 300 stores nationwide with both high street and out of town locations. Established in 1981, Poundstretcher has streamlined its offering to provide a variety of good quality product ranges at affordable and competitive prices.

Its vision is to be “a unique, added value variety retailer; unique in that the total shopping experience – product width and depth, range presentation and merchandising and friendliness of service – will not be matched”.

In order to meet this vision, Poundstretcher knew it needed to improve its warehouse management procedures to better manage and control its stock and to improve efficiency. A solution was required that would improve overall business efficiency and also be able to handle the projected growth in transactions expected over the Christmas period. It needed a system whereby stock control, forecasting and planning became a major part of the business routine.

The existing system relied on paper-based warehouse picking and stock movement and Poundstretcher wanted to move towards a more integrated electronic solution to reduce the need for processing large amounts of hard data, which was inevitably at the risk of human error.

The new system therefore needed to not only remove the requirement for paper, but to also handle large amounts of information and produce reports providing clear visibility on stock control, warehouse picking and stock movement. The intended system was to be deployed at Poundstretcher’s head office as well as in three regional distribution centres (RDC).

Les Thomas, IT director at Poundstretcher, comments: “We saw an opportunity to enhance performance by implementing a system to remove time spent on manual warehouse processes and, at the same time, reduce the possibility of fraud within the company.”

The solution

Poundstretcher had worked with Alphameric since 1993 and already operated its retail stock and merchandising system. The retailer decided that it made clear business sense to integrate anything new with its existing infrastructure, taking advantage of Alphameric’s business intelligence and radio frequency (RF) warehouse control solutions.

The solution was viewed as a major extension to the capability of the existing merchandise management systems and would permit full warehouse control via RF terminals.

The RF solution included:

Goods receipting and barcode labelling of pallets.

Put-away of receipts to bulk storage or picking locations.

Picking onto pallets.

Pallet tracking.

Audit checking of pallet contents.

Despatch of pallets and notification to stores.

Bin transfers.

Stocktaking and perpetual inventory.

Visibility of pallet contents and real-time bin contents.

Picking performance and throughput statistics.

The solution is fully integrated with Alphameric’s merchandising system, encompassing purchase order management, expected deliveries, goods receipt, stock allocation and replenishment and warehouse Management. The business intelligence system allows Poundstretcher to improve planning strategies and analysis aimed at helping improve overall operations – the solution can collect data down to the lowest level, analyse every detail and deliver comprehensive reports.

It is anticipated that the business intelligence system coupled with the RF scanners will enable Poundstretcher to gain visibility and insight into their future performance so that it can optimise its long-term profitability.

Initially, the solution is being used for buying, merchandising and monitoring store activity, providing Poundstretcher with detailed branch information highlighting possible fraudulent transactions.

Thomas comments: “The main benefit these systems provide is that because every snippet of information is being fed into the system from the warehouses right down to the individual branches, you can begin to see patterns emerging that you might not necessarily otherwise see. For example, we may begin to notice certain branches which seem to be carrying out a lot of refunds or creating a lot of voids and the management will be able to tackle this head-on.”

Poundstretcher can also see right across the range and evaluate which products are selling, in what branches and why. By using the Alphameric system, as opposed to manually gathering data on spreadsheets, discrepancies can be avoided altogether.

Improvements in productivity and picking became immediately apparent after the system was implemented, with a stock accuracy level of 99.7% once all warehouse personnel had been fully trained on the RF system. Quality control error checks also indicated a reduction from a 3% error rate to a 1% rate with RF.

Looking ahead, Thomas says: “Already we are seeing significant results following the implementation of the Alphameric systems. As a company we are looking at aggressive growth targets for the future. Deploying these solutions now provides us with the infrastructure and capability we require to manage the planned growth.”

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