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Stock allocation and replenishment model design of gift sets

Douglas Spain

Douglas is an international beauty, parfum and cosmetic retail chain with German origin. In 2018, it counted with more than 2.000 stores in Europe and more than 20.000 employees. In Spain, its network had more than 300 stores and a distribution center. All articles were supplied to stores from the distribution center.

The Project

To increase sales during the Christmas season, Douglas asked us to create a stock allocation model for the representative references of this period, gift sets. Based on the sales history, brand weight per store and stock available, target stock levels per SKU were assigned based on the sales accumulated during this season and the sales profile obtained from the last campaign. Stock for online channel was considered as well. Stock out and over stock at stores were measured daily using a color code to prioritize shortages that could be attended from the warehouse.

We designed a stock redistribution tool that allowed us to optimize sales in the last two weeks of the campaign by moving over stock to stores with greater sales potential.

The Results

  • 81,6% of gift sets sent to stores were sold during the Campaign. 
  • Sales optimization through the use of a stock redistribution model, selling 75% of the stock moved.
  • The model was used for the next Christmas Campaigns.