Re-engineering the supply chain helps Myer to recover

Filed in archive Best practice on January 30, 2007

According to Supply Chain Review, a re-engineered supply chain, led by former Woolworths executives, has seen retail store Myer turn the corner under new management. Myer has quickly slashed stock levels and reorganized its inbound chain since the private equity buy-out from the Coles group last July. The company has offloaded more than $400 million in stock, allowing it to rationalize its warehousing.

In an interview with The Australian newspaper, Managing Director Ben Gray says overstocking was costing the company not only in warehousing but in labour in moving merchandise between distribution centers and stores.

He talks of a just-in-time model for the retailer, with faster inventory flows - customers don't want the latest clothing designs three months after they've appeared in a fashion magazine, he says. He says the company's independence from Coles has also helped, claiming Myer came last in having to work with supply chains and warehousing systems.

"Myer was the last cab off the rank," he says. "It was an orphan asset within Coles Myer - which was part of the reason it was such a great opportunity."

Myer has poached several Woolworths chiefs to help in the revival, including former executives Bernie Brookes and Bill Wavish, once seen as a successor to Roger Corbett. Gray says there are plans to open more stores around the country.