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Neweggs Supply Chain,Mike Barth Todd Hillard,Agenda,Company Background Key elements of supply chain IT System Distribution System Supply Chain Conclusions Questions,What is N?,Company Statistics,2nd largest online only retailer in the US. $2.1 Billion in sales last year (1/8 of A) Over 40,000 SKUs stocked / distributed 1 million + square feet of warehouse space in the US. (CA, KY, NJ, TN) 12 million register customers.,Company values,Customer centric mission Achievement points: Distribution - Efficiency and well planned management of products IT Systems Well designed e-commerce site and software to manage all aspects of the company.,Obtaining products,Majority of management and deal cutting is done in China. Deals are constantly sought with young company with newer innovative products. Deals are cut both directly with companies and also through brokers depending on manufacturer location.,IT Systems,All business software / sites are developed and maintained in house. Financial transactions are handle by SAP. Distribution is handled by Dematic. Class III IT system,E-Commerce Website,Business to Customer Customer features Easy intuitive layout Forums How to Reviews,Website Support,24/7 Automated, Live chat capabilities RMA Support / Purchase Protection Data warehouse backups Standard web security / certifications,Neweggs Distribution System,Distributor storage with small carrier delivery. Three primary DC sizes: Small Small orders with quick turn around Medium Combination large/small orders. Large Large bulk order storage. All DC function handled by a Logistics company.,Distribution growth,Expanded to East Coast in 2003 Cranberry, NJ / 75,000 sq. ft. warehouse Edison, NJ / 50,000 sq. ft. warehouse Rapid growth 40% total sales 2007 New 380,000 sq. ft. Distribution Center,Distribution Cycle,Dematic Logistics,World wide logistics company; All-in-one. Specialize in full DC automation. Increasing order efficiency, accuracy and speed. Implemented Dematic System Pick-to-light system Conveyor platform,How does Dematic system work?,Warehouse inventory ordered from offices attached to the warehouse,Pallets are received, unpacked, and sent to receiving a mere 30 feet away,The Dematic System,Every item that comes into Newegg is scanned Information associated with each barcode Product specifications Physical dimensions / Weight of product System knows what box to use Weight and barcodes checked against database Pictures taken of all items for website,The Dematic System, Staging area closest to receiving area,Staging Area farther away from receiving area,The Dematic System,The Dematic System,3 levels organized by “velocity” Medium / Low velocity products on 2nd and 3rd High velocity products found on 1st floor,The Dematic System,Bar-coded tub assigned to each order received Items for order Location of items Tub travels on conveyer stopping at each location of items for order,The Dematic System,The Dematic System,Main System Controls,Products grouped by frequency of purchase,The Dematic System,The Dematic System,Elevator to Express Lane,The Dematic System,Express Lane,The Dematic System,Secure Area,The Dematic System,Order sorting for boxing Order checking Label printing,The Dematic System, Peanut Gun packing station,Bubble Wrapping & Box taping ,The Dematic System,Out the door! 2 day turn around goal,The Dematic System,Results,Accuracy and quality of orders received by customers damage-free - 99.9% Orders received by 3 p.m. local time ships same-day about 98 percent of the time Now #1 in customer satisfaction for online retailers* * American Customer Satisfaction Index survey by the Univ

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