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"The Internet has given global sourcing companies an affordable communication infrastructure for managing a wide range of applications. Using the Internet as a communications tool, NGC has developed a state-of-the-art sourcing and production system."
Source: New Generation Computing, Inc.
Case Study: R.G. Barry
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R.G. Barry Corporation, the Dearfoams® company (), is among
the world's leading developers and marketers of accessory footwear, a category
that encompasses slippers, sandals, hybrid and active fashion footwear, slipper
socks and hosiery.
The Challenge :
R.G. Barry lacked real-time visibility into production schedules at its
factories and relied on emails and verbal communications. As a result, the
company built more safety stock, required longer lead times, and could not
quickly update customers on the status of their orders.
R.G. Barry selected e-SPS®, a web-based global sourcing solution that
provides real-time visibility and collaboration throughout the supply chain.
The company expects that e-SPS will help R.G. Barry reduce its lead times by
20-25 percent and reduce its inventory by 10-15 percent – freeing up cash and
minimizing the risk of carrying excess inventory.
When R.G. Barry shifted from captive manufacturing
to 100 percent outsourced production in 2004, it was an essential ingredient in
a dramatic, highly successful business turnaround for "the Dearfoams® company,"
one of the world's leading developers and marketers of accessory footwear.
The company closed its three factories in Mexico, expanded its four year- old
sourcing office in Hong Kong and shifted all production to Asian factories,
allowing R.G. Barry to reduce overhead and better manage the fluctuations of its
highly seasonal business. However, the move to global sourcing was only the
beginning of R.G. Barry's quest to transform its supply chain efficiencies.
The Hong Kong office initially used a stand-alone system that wasn't
connected to R.G. Barry's enterprise systems, hampering communications between
company headquarters in Columbus, Ohio and Hong Kong. "We lacked real-time
visibility into production schedules at the factories, and we relied on emails
and verbal communications to understand when shipments were running late or if
the factories had production problems," explains Glenn Evans, senior vice
president of sourcing and logistics, R.G. Barry. "As a result, we needed longer
lead times, we built more 'safety stock,' and we weren't as timely as we wanted
to be in updating our customers on the status of their orders."
Realizing the need for change, R.G. Barry embarked on a search for global
sourcing software in 2007. The company reviewed solutions from a number of
leading software vendors before selecting e-SPS from NGC® (New Generation
Computing®). e-SPS is a web-based global sourcing solution that provides
real-time visibility and collaboration throughout the supply chain.
A key factor in choosing e-SPS was the software's ability to easily integrate
with R.G. Barry's existing supply chain solutions from Logility and American
Software, NGC's parent company. "It's extremely important to us that all three
of these systems are under one parent company," Evans says.
R.G. Barry began the software implementation early this year, working closely
with NGC's offices in the U.S. and Shenzhen, China. "I was initially concerned
with the distance – trying to implement a system in Columbus and Hong Kong and
then training vendors to use it – but it's exceeded my expectations," Evans
says. "All of our vendors are up and running on the system. A majority of our
users are in Asia, so the support and expertise from the Shenzhen office was
tremendously helpful during the implementation."
R.G. Barry has rolled out the first phases of the e-SPS software, which
include P.O. tracking, visibility into the production process and the factory
floor, and web-based collaboration between R.G. Barry's offices and vendors
around the world. While the software will be put to the full test during R.G.
Barry's fall season, the company is already seeing encouraging results:
Streamlined Communications Help Reduce Lead Time.
An improvement in communications is among the earliest results of the
software implementation, according to Evans. e-SPS has centralized all supply
chain communications in a single web-based portal, eliminating the need for
email and verbal communications. The software's time and action calendars help
streamline the workflow, and alerts are automatically triggered when events and
activities don't happen on time. As a result, says Evans, "we're getting a much
better flow of information on production status."
With e-SPS, R.G. Barry believes it will ultimately reduce its lead times by
20-25 percent, allowing the company to react much faster to trends; for example,
quickly ramping up production of best-selling styles to meet increased demand.
Evans says that e-SPS can also help the company reduce its inventory by
approximately 10-15 percent by eliminating the need for safety stock. This will
not only free up cash that was previously tied up in inventory, but will also
minimize the risk of carrying excess inventory for slower-moving styles – and
the resulting markdowns.
Greater Sourcing Agility
"We're getting a much better flow of information on production status"
Glenn Evans, Senior Vice
President of Sourcing and Logistics, R.G. Barry
With e- SPS, R. G. Barry can more easily scale to meet the fluctuations of
its highly seasonal business. The company outsources to three primary factories
in China but ramps up its production rapidly to meet seasonal demand. As an
example, Evans explains that "in the month of May, we produced about a million
pairs of slippers – but in the month of July, we produced 4 million pairs. With
the seasonality of our business, we may expand production to 19 or 20 different
R.G. Barry expects to see further benefits from e-SPS over time. The company
plans to implement additional functions with e-SPS later this summer, including
tracking the on-time performance of individual vendors as well as quality
management at the factory level.