Item Flow
The item flow describes how item groups and items are purchased and distributed in the store network.
There are 3 main scenarios:
- Vendor to Store
- Vendor to Warehouse, Warehouse to Store
(with and without Cross Docking) - Store to Store.
Vendor to Store
In this scenario the purchased items are delivered directly to the destination stores.
This is common for fresh items and bakery items in grocery stores due to limited durability. This is also common for local or regional products for stores with local assortments. Smaller retailers, without warehouses, use this approach also very often.
Vendor to Warehouse, Warehouse to Store
This is the most common approach in retail, where purchased items are routed via a warehouse to the stores. The warehouse acts as a distribution center and buffer to ensure replenishment to the stores.
LS Central supports two approaches to cover these item flows:
- Without Cross Docking
- With Cross Docking
In both approaches the items are delivered to the warehouse first. In the approach with cross docking, the destination store is already known and a Transfer Order is created together with the original Purchase Order. A goods receipt needs to be performed for the Purchase Order before the shipment of the Transfer Order can be started.
Store to Store
In this scenario, the stores are replenished from other stores. This is a common approach for one-time or seasonal items which cannot be replenished anymore after the first purchases. When the entire stock is distributed among the stores, re-balancing is needed to ensure that the items are replenished to stores with demand.
Level of definition
Above scenarios can be selected for item groups, individual items, and even item-store combinations. This means that an item in store A can be replenished directly from the vendor, while in store B it is replenished from the warehouse which is replenished from the vendor.
Goal
The goals of this step:
- Get a detailed understanding of the retailer's item-flow approach
- Identify different item-flows for different product groups
- Create an item-flow drawing
- Select the right item-flow strategies in LS Central.
Key questions / considerations
- Are all items purchased through the warehouses?
- Is Cross Docking used for the purchase and transfer process?
- Are product groups or items purchased to the stores directly?
- Which product groups or items?
- For which stores?
- Are items redistributed between the stores?
- Which product groups or items?
- For which stores?
Output
Item-Flow drawing (see example here):
LS Central setup considerations
Covered in the detail sections.
Scenarios | See |
---|---|
Vendor to Store | Vendor to Store |
Vendor to Warehouse, Warehouse to Store | Vendor to Warehouse to Store |
Store to Store | Store to Store |
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