FLOOR READY MERCHANDISE

What is FRM?
To Make merchandise ready to sell before it arrive on
the floor.
Why FRM?

1. To avoid delays in store opening in the morning.

2. To reduce the processing time at Unit level.

3. To reduce the number of time material gets handled at DC,

Unit level.
Scope of Study

 Study of current process

 Application of FRM concept in SSL.
Current Process

 Receiving Process:
at DC
at Unit
 Dispatch Process:
of DC
of Unit.

Microsoft Excel
Worksheet
Vendor DC DC DC Units
Dispatch style Receiving Processing Dispatch style Receiving
style style

Merchandise Remove the Poly-bag Again wrapped Removal of

packed in a Carton removed in poly-bag carton, poly-bag.
carton

Each pcs Pcs transferred Puts on Security Gets Packed in aSome pcs gets
wrapped in a to resp. slots tags carton displayed on
poly-bag with poly-bag on. hangers
Rest piled up in
a Gandola
Key highlights of current process

 Very Economical

 No special requirement for different types of merchandise

 On every link, value addition to make it FRM.

Hence, no. of handling more per merchandise.

 Duplication of the work at each link.

Application of the FRM Concept
1. Men's Ethnic Department
2. Ladies SKD
3. Ladies MnM
4. Suits & Jackets
Alternate Models

1. DC carry out Hangering operations

In Half Folded Condition
1. DC carry out Hangering operations
In Full Length Condition
1. Vendor carry out Hangering Operations
In Half Folded Condition
1. Vendor carry out Hangering Operations
In Full Length Condition
Comparison among Alternatives
Parameter Alaternative-I Alternative II Alternative III Alternative IV

Processing required
At DC yes yes no no
At unit yes no yes no

Man power required @ DC required @ DC Not required Not required

Fixture Not required required @ DC Not required Required @ DC

Transportation
Vendor to DC No increase No Increase No increase Increase
DC to Unit No increase Increase No increase Increase

Poly bag cost Increase Increase Increase Increase

Hangers
Procurement cost yes/no Not increase Increase Increase
Logisticvs cost Increase Increase Increase Increase

# of handling Reduced Reduced Reduced Reduced

SKD Dept. - Mumbai

 Avg. monthly sales : 6450 pcs

 Browsing capacity : 7446
 Avg. NWC : 09
 No. of Vendors : 08
 No. of Brands : 08
 Cost Comparison
Cost Alternative I Alternative II Alternative IIIAlternative IV
(Half Fold) (Full Length) (Half Fold) (Full Length)
JIT FRM JIT FRM
Man power 7800 7800 7800 7800 0
(2 labour *3900)
Not
Transportation cost 0 0 100000 100000 0 possible
(no change in (no change in as
mode of (Dedicated vans mode of transport
transpotation) required*) transpotation) ers
Poly bag procurement doesn't
(Rs8/ bag) size: 20"X48" 60000 92200 60000 92200 45000 book
open
Hanger Movement Redirecting Giving away Redirecting Giving away consignm
7800 0 0 0 0 ents

Hanger Procurement 0 67500 0 67500 67500

Incremental Sqaure feet cost 0 0 0 0 0

Sub Total -Variable 75600 167500 167800 267500 112500

Initial Cost
Fixture cost 0 0 42000 84000 0
Rs 6000/fixture (fixture - 6 qty)

Total 75600 167500 209800 351500 112500

Current Costing for MUM Region - SKD Dept
August month details
Transportation Cost 253275 Rs/month
Qty moved from DC - Units 298201 Pcs

Cost to move 1 pc 0.8493432 Rs/pcs

Avg. Daily Volume of SKD 250 pcs

Daily cost 212.33581 Rs/ day

Monthly cost 6370 Rs/month

Recommendation

 Concept is striking But uneconomical compare to current

cost of replenishment.

 Can not extend to each Dept as All merchandise doesn’t

get displayed on the floor.

 FRM concept Require Special Infrastructure for each Dept.

 Thanks
&
Your inputs on topic are
welcomed.