PUPA “Italian quality and style icon” is a company that since 30 years produces and distributes cosmetic products in Italy and in 67 countries around the world, promoting the authentic values of “made in Italy”. Its strong artistic identity and great charm spread a solid culture always looking for future. In Italy, the distribution network includes approximately 4.500 perfumeries, while in Europe it is present in France, Austria, Romania, Slovakia, Hungary, and Czech Republic – even with direct sale points -. Every year, by virtue of its strong tendency to product innovation, PUPA manages a high number of references/colors, partly continuative and partly one-shot.
SCENARIO
During the last years, distribution profoundly changed its own rules and the companies have had to face new challenges. A key factor in the new distribution scenario resides in the ability to manage the complexity of the final customers’ requests: where once it was possible to deliver to big dealers and leave the burden of worldwide distribution to single retailers to them, now, even the major brands, realize the need to face deliveries numerically much higher and smaller in quantitative terms. To complete the picture, it is necessary to highlight the impact – on logistics and management aspects internal to the company – of the needed increase in references in order to be able to maintain the sales volume unaltered. Delivery fragmentation and capillarity, together with traceability of production lots, are then increasingly becoming key factors for a company’s success.
STRONG POINTS
From the point of view of traceability and management of the supply chain, PUPA played a significant role as a pioneer since all products are monitored by an office responsible for quality control and the product chain is tracked following GDO’s models in the food field. Therefore, a very strict process of traceability of production lots and of shelf-life analysis and repeated checks on the quality of the products placed on the market are present inside the company.
Marcello di Francescantonio, PUPA’s Logistic Manager, says: “The company’s distinctly technological vocation led PUPA to contact KFI to analyze the various distribution processes and to check for possible aspects which could be improved together. The confirmation of a suspect arrived from the combined analysis: while sell out was controlled optimally, the returns management appeared to be the most problematic aspect of the supply chain process.”
In particular, the company found necessary to improve the management process of the returns coming from perfumeries, vending machines, and stores. KFI then stood side by side with the company to check the existent processes, which were the areas that could be improved and which was the most efficient approach to meet the expectations of a company with such a distinct technological imprint. The first step was the study and examination of the existent processes: before the intervention, the returns arrived in the company with a simple content list; the check of the materials inside the lots was carried out manually, though a very quick but definitely inaccurate process. Unequivocally certifying the products returning from the perfumery or from the point of sale appeared to be the first necessity for the company. The second request to KFI was to efficiently manage the warehouse, with a positive impact on reconditioning, namely the shipping of part of the returns in the outlets channel. Previously, in order to recondition a category of products, it was necessary to manually open all the packages in the warehouse, to divide the products by commodity category and to check their conditions. Naturally, this type of process was very expensive in terms of workforce, had inaccurate management of the actual stocks of the warehouse and the risk – in the absence of continuous monitoring – of finding expired products or products in poor conditions, and therefore unusable.
THE SOLUTION: LEAN, PRECISE AND FAST PROCESSES WITH VERY LOW MARGIN OF ERROR
A sorting process able to combine the customer’s requests and to ensure an efficient management of the return and reconditioning processes was studied together with KFI. In particular, posts based on multi-reference vs mono-reference ventilation logic using a technology based on put to light were designed: upon receipt, the packages are opened and the products scanned. Simultaneously, the scanner sends a signal which transforms into a luminous pulse that allows the operator to intuitively position the product in the right place in one of the many trays located on the rack created ad hoc. In such way, it is automatically certain that the products have been divided accurately, quickly and without waste. Moreover, the single trays can be packaged immediately, therefore ensuring unique stocking. Additionally, the software specifically designed by KFI allows to choose the sorting mode depending on the type of return order: as a matter of fact, after checking the package content, the software performs a qualitative and quantitative analysis and then proposes the various stocking options which might be functional for that specific return. Furthermore, it is possible to manage more voluminous orders or to identify which products are out of range, and therefore not reconditionable, in real time.
The solution proposed by KFI, besides slimming down and speeding up the process, also has the advantage of having an extremely low margin of error (below 1 per thousand) and of being easy to use: as a matter of fact, training courses are not necessary since, after a few minutes on average, the operator is already able to work autonomously.
A final consequence deserves a mention: since large packages and weights must not be handled anymore, in PUPA this function is mainly carried out by women. This, as Marcello di Francescantonio declares:
“represents an additional resource for the company and for the entire production process: the entry of women in almost entirely precluded areas until now allowed the introduction of improvements and managerial innovations precisely by virtue of the particular feminine sensitivity which added to the normal logistical and management practices of the company.
HONEYWELL SAFETY & PRODUCTIVITY SOLUTIONS
To implement this project, KFI chose Honeywell Safety & Productivity Solutions technology for its high quality and innovation. Honeywell S&PS is one of the world’s most important producers of terminals, barcodes readers and printers and stands out for its wide range of products which help Enterprise Companies optimize performances and processes to increase productivity. Optimizing the efficiency of the inventory and of the stock, increasing productivity and improving accuracy are fundamental goals for warehouses and distribution centers. The acquisition of data in real time in the point of transaction represents a key factor to achieve this goal since it allows to integrate the data with the company’s system through wireless connectivity. Independently from the type of operation to be carried out (reverse logistic, reception, cross-docking, arrangement, withdrawal, restock, packaging, distribution or inventory checking), having access to the most appropriate device is essential to obtain optimal performances both from the personnel and from the systems for materials handling.