Raffaele Destro
Vice President Business Development Fashion
Puma, one of the world's leading sporting goods manufacturers for shoes, clothing and accessories, has invested in a new central European Distribution Center in Geiselwind, Germany. The goal was to combine multiple B2C/B2B distribution centers into one fulfillment center. The new omni-channel DC serves all channels (retail/wholesale, direct) from one location and fulfills orders from throughout Europe.
CENTRALIZATION Consolidating the European distribution centers into one central fulfillment center in Geiselwind, Germany
OMNI-CHANNEL Fulfillment of retail/wholesale and direct orders from one distribution center
AUTOMATION A high degree of automation ensures a consistent output level - even when there are drastic peaks
Puma, one of the world's leading sports brands, earned sales of 5.5 billion euros (EBITDA: 440 million euros) in 2019 and employed over 14,700 people. The sales breakdown is 75% retail stores and 25% direct-to-consumer, with footwear being the strongest product segment at 46% (38% clothing, 16% accessories).
The sporting goods manufacturer, which is based in Herzogenaurach in Bavaria, distributes its products to more than 120 countries worldwide (36% EMEA, 35% Americas, 28% APAC).
In the past, Puma made use of a decentralized distribution network with separate local DCs for B2B (retail/wholesale) and B2C (direct-to-consumer). High inventory levels and process costs were important reasons for a strategy change. Most importantly, however, Puma was no longer able to offer its (internal or external) customers the level of service they expected. Therefore, in 2019, the sporting goods manufacturer decided to merge all 22 European distribution centers into one central fulfillment center: the perfect omni-channel DC.
Puma is experiencing strong growth in all three sales channels. Thus it was important to develop a solution that could cover both retail/wholesale and e-commerce orders. It is difficult for Puma to predict how the individual orders will break down across channels on any given day which made it important for the fulfillment solution to be extremely flexible. Therefore, one of the most important design criteria was a high degree of automation to make it possible to react quickly to changes of the order structures - and to do so with consistently high quality.
Puma processes returns, cartons and large goods in the goods receiving area. If the returned goods fulfill the reuse criteria, they are repackaged, put onto trays, as are goods in cartons, and stored in the shuttle system (713,000 storage locations). Large goods are put into storage in the large parts warehouse.
The order picking process is covered by the standardized FlashPick® order fulfillment system. FlashPick® is the modular Goods-to-Person (GTP) system for single-piece picking. Particularly omni-channel business models allow the system to truly shine, because it responds flexibly to order structures and transacts orders individually and independently of each other.
The shuttle system retrieves the goods fully automatically and supplies 27 manual picking workstations (PickCenter One). There, the operator picks the goods directly into cartons or totes for further processing. The "One Source. One Target."approach means that the system features maximum accuracy with unbeatable speed.
After the pick, the goods are returned to storage in the shuttle system, while the order is sent either directly to goods issue or to the packaging area.
At goods issue, the goods are either sent directly to the lorries using outbound sorters or stored intermediately in a shuttle buffer for shop orders. The shuttle buffer is connected directly to palletizing robots (Autostax) which make the mixed cartons available on pallets fully automatically.
FlashPick® - as the core of the solution - was the ideal choice for Puma due to the single management approach. Orders ard individually and flexibly handled. This enables the sporting goods manufacturer to fulfill both large and small orders regardless of any changes in order structures. This makes it possible to have later acceptance times and earlier deliveries at the same time. Another step forward for Puma in its "FOREVER FASTER" strategy.
A 10-year service contract ensures maximum system availability with transparent and predictable costs. The sporting goods manufacturer is able to concentrate on its core processes while 30 onsite TGW engineers work proactively on maintenance and continuous improvement of the system. Puma benefits from cost transparency and low Total Cost of Ownership.
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