Significantly Increases Shipping, Receiving, and Inventory Accuracy with AGI Worldwide

Company Profile - Quiksilver

Quiksilver, Inc. (NYSE:ZQK) is the world's leading outdoor sports company, which designs, produces, and distributes a diversified mix of branded apparel, wintersports, golf equipment, footwear, accessories, and related products representing a casual lifestyle for young-minded people under labels such as Quiksilver, Roxy, DC Shoes, Raisins, Radio Fiji, Hawk Clothing, Roxy Girl, Teenie Wahine, Fidra, and Leilani.

The Company's products are sold in over 90 countries in a wide range of distribution, including surf shops, ski shops, skateboard shops, snowboard shops, proprietary Boardriders Club shops, other specialty stores, and select department stores. Quiksilver's corporate and Americas' headquarters are in Huntington Beach, California; the European headquarters are in St. Jean de Luz and Voiron, France; and the Asia/Pacific headquarters are in Torquay, Australia.

Challenge

With more than 500 employees in two distribution centers totaling 610,000 square feet, and processing an average of 200,000 with a record peak of 427,000 units per day to more than 2,000 stores, Quiksilvers Americas headquarters needed a dynamic WMS solution that could be easily configured to manage the ever changing demands of high-volume retail distribution through multiple channels in the supply chain. Being a global industry leader of seasonal products, Quiksilvers WMS had to be capable of accurately receiving hundreds of thousands of various products, allocating inventory, and rapidly shipping to thousands of customers with varying inventory levels based on seasonal demand.

"We are committed to getting our customers an excellent variety of the very latest high-quality merchandise quickly and cost-effectively," said Andy Engel, Operations WMS Director for Quiksilver. "Part of that mission means thinking outside the box when it comes to the supply chain."

Solution

Quiksilver turned to AGI Worldwide for help in selecting, implementing, and maintaining their Warehouse Management and Supply Chain Execution Solution. Quiksilver and AGI Worldwide selected HighJump Software, a 3M company, based on the strength of itsWMS and retail-specific functionality. For Quiksilver, the ability to adapt business processes was a key requirement - a lesson the company had learned with the rigidity of its previous WMS. "Companies need to consider what they want to do not just today, but down the road. One of the things HighJump offered was the ability to grow with our business. We're a very dynamic organization and have a lot of changes in our business practices," said Ed Shaver, Senior Vice President of Distribution Operations for Quiksilver. As Quiksilver extends its solution to new warehouses, adds product lines or takes on new customers, in-house staff can quickly make necessary system changes without disrupting operations.

In tailoring the solution to meet its particular needs, AGI configured the WMS to provide clear visibility into customer orders and shipping times and to direct staff to pick, pack, and hold until a customer's shipping window opens. "If many of our customers want orders shipped on the first day of the month, we can't suddenly pick, pack, and ship everything in one day," Engel said. The WMS System "allows me to plan outbound shipments with great precision. So we're set to go when the customer's shipping window opens, and our product gets to the store right away."

"We wanted to improve our picking, packing, and overall accuracy. We accomplished this in a very short period and began to look at how we could further improve these processes and really maximize the investment," said Andres Castillo, Vice President, Distribution Operations.

Results

Quiksilver has now significantly increased shipping, receiving, and inventory accuracy with AGI's implementation.. "Our picking and packing have more than doubled," Engel said. "Our capacity to process orders has increased and the timeframe in which we process them has dropped significantly. Before it may have taken a week to process an order. Now, if an order drops to the floor, we can process it the same day if necessary."

Quiksilver has been able to dispose of physical inventories, which resulted in more than $4 million in savings in 2004. Now, instead of closing operations in distribution centers for five to ten days each year while conducting physical inventories and delaying up to $10 million in order processing, Quiksilver is now able to cycle count each location two to three times a year with no interruption in operations.

Future Plans

Quiksilver plans to continue improving its system through the seamless integration of material handling automation equipment. "We are extremely pleased with the success of the Quiksilver project. We were able to bring all of the participating vendors together, fill in existing project gaps, and efficiently tailor a solution specifically for Quiksilver that is able to meet Quiksilver's defined needs," explained John Bryant, President and CEO for AGI. Bryant continued, "Quiksilver now has a solid and fully integrated WMS infrastructure, enabling them to not only significantly improve shipping, receiving, inventory, and overall accuracy, but to also accommodate future growth and increase in demand."

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