Viewpoint: Stein Mart proves power of transportation innovation

By ·

One of the most satisfying results of any management objective is when the benefits not only exceed your departmental expectations, but also unexpectedly flow to other parts of the organization—thus creating operational improvements across the board.

While this may sound like the introduction to the latest best-selling management book, this is just what unfolded for the supply chain team at Stein Mart—a fashion retailer with 260 stores and $1.2 billion in sales in 2010—when it re-engineered its transportation operations over the course of the past two years.

Prior to 2009, Stein Mart had been having some success in shipping product directly, and quickly, from its vendors to its network of stores via small parcel carriers. But while those carriers where doing a commendable job, the retailer was bumping into issues with packaging requirements compliance and floor-ready guidelines, freight visibility was limited, and store delivery times didn’t always mesh with store hours.

“It was getting expensive,” Gregg Sayers, director of supply chain transportation tells our John Schulz in this month’s cover story (page 24). “There were expenses at the stores to get merchandise ready to sell; and there were also problems with managing the receipt of our product and the ability to reconcile anything that was not in compliance.”

Newly appointed Vice President of Supply Chain Rick Schart reviewed the situation with Sayers and Bill Stover, his two new recruits at the time, and the team went to work to re-organize the retailer’s transportation operations. First, the parcel carriers were replaced with a network of LTL and TL carriers, creating dedicated and pool transportation lanes. Then the team spent six months educating vendors on the new process just to get the ball rolling.

Beyond the expected benefits of the new transportation process, the team started to see considerable labor savings at the storefront because managers could staff accordingly now that they knew when freight would arrive. Meanwhile, improved communication with vendors had merchandise ticketed and floor ready, thus cutting more time and expense once on the store floor.

According to the team, the overall cost savings is now rolling in at about $20 million annually. “It came down to having the right team in place, the right carrier and 3PL partners, and having the Stein Mart organization, especially IT, aligned to support the new concept,” say Schart.

This dramatic example of how a supply chain re-design can improve overall operations has earned Stein Mart the 2011 NASSTRAC Shipper of the Year Award, the highest honor bestowed upon the council’s membership and awarded in partnership with Logistics Management.

According to NASSTRAC Executive Director Brian Everett: “Stein Mart’s innovative approach epitomizes the transportation and supply chain best practices that we encourage in our industry.” And once you read this month’s inspiring cover story, you’ll find it tough to disagree with Everett’s sentiments.

About the Author

Michael Levans, Group Editorial Director
Michael Levans is Group Editorial Director of Peerless Media’s Supply Chain Group of publications and websites including Logistics Management, Supply Chain Management Review, Modern Materials Handling, and Material Handling Product News. He’s a 23-year publishing veteran who started out at the Pittsburgh Press as a business reporter and has spent the last 17 years in the business-to-business press. He’s been covering the logistics and supply chain markets for the past seven years. You can reach him at [email protected]

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

October 2011 · Stein Mart · All Topics
Latest Whitepaper
Case Study: LEAN Yields Big Results
Every day, companies across a wide range of industries use LEAN in their supply chains, warehouses and distribution centers, finance departments, and customer service centers, among other areas. LEAN practices improve safety, quality, and productivity by extracting cost and waste from all facets of an operation – from the procurement of raw materials to the shipment of finished goods.
Download Today!
From the October 2016 Issue
Over the past decade we’ve seen a major trend in regards to safety regulations for freight transport within the United States as well as for import and export shippers—that trend is the “international­ization” of rules and regulations.
European Logistics Update: Post-Brexit U.K. moving ahead, but in which direction?
Badcock Home Furniture &more: Out with paper, in with Cloud TMS
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
How API Technology Connects the Transportation Economy
Dynamic decision making is made possible through accurate, actionable data. When combined with progress in data science and the Internet of Things, technology companies that add value to direct-to-carrier APIs and combine them with high-power data analytics will create new concepts for the information economy.
Register Today!
Motor Carrier Regulations Update: Caught in a Trap
The fed is hitting truckers with a barrage of costly regulations in an era of scant profits....
25th Annual Masters of Logistics
Indecision revolving around three complex supply chain elements—transportation, technology and...

2016 Quest for Quality: Winners Take the Spotlight
Which carriers, third-party logistics providers and U.S. ports have crossed the service-excellence...
Regional ports concentrate on growth and connectivity
With the Panama Canal expansion complete, ocean cargo gateways in the Caribbean are investing to...