How Kids2 managed a distribution changeover in time for the holiday sales season
In an effort to better position the company for global scaling and to improve the customer experience, Kids2 partnered with a new distribution company in 2019. It was a huge undertaking to transition its baby and toy product inventory to a new distribution center and to set up new systems and processes in time for the holiday rush. With any transition of this size, issues will arise. The implementation team knew such issues had to be addressed quickly in order to avoid product gridlock during the holiday season.
Not wanting customers to experience a delay, company leaders huddled in a conference room at its Atlanta headquarters to troubleshoot causes for a forecasted backup. Knowing they were up against the clock, Anthony Isla, Kids2 director of global distribution & logistics got on a plane to California.
“We all had one focus, one priority. Do everything we can to serve our customers."
“We all had one focus, one priority,” said Isla. "Do everything we can to serve our customers."
Isla has a unique skill set for such situations with experience in inventory and supply planning as well as distribution and logistics. He helped the distribution partner team understand the complexity of Kids2’s business as well as the processes necessary to get inventory moving to its retail customers.
"With the timing of the switchover," said Isla. “We weren’t able to schedule a distribution blackout window for our largest retail customer during the transition. By shipping to our largest retailer first, we inadvertently turned on the faucet too fast and had to hustle to get the kinks worked out with no customer impact."
The team rolled up their sleeves to find creative solutions to address specific blockages in the system. Several departments, including planning and inventory, account services, transportation and logistics, and sales collaborated to get product out at a volume and pace needed for demand.
"Everyone felt a sense of ownership," said Isla. "When you see a product is in danger of not shipping, you take it personally because it affects our customers and Kids2’s bottom line."
The team took an entrepreneurial approach to problem-solving. For example, the workflow of inventory coming off the shipping containers to be processed in the distribution center and stored in the warehouse was resulting in a bottleneck. The product that needed shipping most urgently was not getting through the system as fast as it needed.
At the same time, a large Kids2 customer had a time-sensitive baby promotion. Product in the warehouse needed to get to be accessed quickly and ready for pick up. When the retailer’s trucks arrived, however, they were getting stuck behind other trailers and had to move on to service other pickups.
The team was determined to get the products to the customer. To address the issue, they flagged the containers with the promotion product as they came off the ship and had them processed at the back door of the distribution center loading dock. The logistics team utilized its resources to secure multiple tractor-trailers and had the area cleared so they could load immediately. The account teams worked with the customer to arrange for the trailer deliveries, and the products made it to the stores on time.
The situation provided many lessons including:
- Communicate clearly and often
- Think like an owner to fix problems
- Ramp up new systems in a drip method rather than at full flow
- Build processes to support what was learned.
Despite the initial struggles, Kids2 never stopped shipping to its customers. During the transition fill rates only dipped by two percent, and now that the transition is complete, Kids2 is experiencing marked improvements over last year.
"The key is to learn from every experience and be tenacious about thinking ahead and identifying what could happen in order to have a plan," Isla shared.
Isla has since returned to the strategy and planning side of operations as Director of Supply Chain Planning. He and the Kids2 global operations team face new challenges including the opening of Kids2’s new manufacturing facility in China just as the Coronavirus hits the globe.
"We never expected to allow for a global outbreak in our plant opening contingency plan."
"We never expected to allow for a global outbreak in our plant opening contingency plan," remarked Isla. "The most important thing is the safety of our people. We are in constant communication with our team, 3PL’s and our partners. It is a unique challenge when dealing with an unpredictable global virus. But our factories are up and running and increasing capacity daily. Everyone is pulling together."
Kids2 is a global company that designs solutions to help early-stage parents and families create tiny wins that build bright futures. The Kids2™ brand portfolio includes the leading infant, baby, and toddler brands Baby Einstein®, Bright Starts®, and Ingenuity®. Headquartered in Atlanta, Kids2 spans globally with 12 offices on four continents serving customers in more than 90 countries and has been inventing and reinventing baby products for 50 years. Led by CEO Ryan Gunnigle, it operates with an agile start-up approach, which fosters the company’s growing success.