Success story CCC

Whether online or in brick-and-mortar stores, one fashion retail concept continues to experience strong growth wherever it enters the market: off-price.

The off-price retail model is based on buying surplus, off-season or last season brand items. This is done on a large scale and at a lower price than the items’ original retail value. These favorable purchasing conditions can be passed on to the end customer. The fashion retailer CCC S.A. based in Poland, established in the traditional retail business as well as in e-commerce, decided in late 2020 to launch its own off-price brand: HalfPrice.

The ambitious business plan called for opening about 60 stores from May to December 2021 in the short term and aims to more than double that number in 2022.

To enable this rapid expansion, CCC asked 4flow to work with the retailer’s newly formed HalfPrice organization to optimize its distribution center in Polkowice, Poland. The new DC had only been in operation for six months prior to the start of the project. The distribution center needed the capability to double its throughput just four months after the project start.

In the first step, 4flow conducted process and IT mapping. Based on the findings, 4flow worked with the experts from the individual process areas to identify improvement measures, such as planning and controlling material flows, improving picking processes, and streamlining shipping processes. 4flow not only considered classic elements of fashion logistics, such as the efficient labeling of articles, but also challenges specific to the off-price sector. Incoming shipments of mixed goods from bikinis to winter jackets, millions of different items, many with only a few pieces in stock – all this must be delivered to HalfPrice stores according to demand.

Based on the rapid assessment of the situation, 4flow and CCC created an implementation roadmap and prioritized certain measures. Thanks to detailed planning, effective implementation was ensured even as the customer team grew and new members joined mid-project.

The biggest challenge of the project was to implement measures during ongoing operations. In less than two weeks, the team managed to redesign material flows on the shopfloor, design a visualization concept, and completely implement these plans on a single Saturday without affecting operations.

While keeping sight of daily delivery targets, CCC and 4flow prioritized the sustainable adoption of new processes. To achieve this, 4flow and CCC introduced standard operating procedures, shopfloor visualizations and Gemba walks on the shopfloor to help leadership better understand how processes happen in practice. These changes also supported the rapid onboarding of new employees in the young HalfPrice organization. The project team initiated purchasing processes for improved equipment early on to stay ahead of volume growth and prepare for major layout changes. Another outcome of the project was the introduction of a KPI dashboard. Operational managers can thus identify bottlenecks and take action during shifts, while management can monitor the relevant KPIs as well as the effectiveness of the measures implemented.

The efforts paid off: just after four months, the team celebrated the achievement of doubling throughput.