Tuesday, February 19, 2013
DSW’s Future in Shoe Retailing
Last week I ordered a pair of shoes from DSW.com, and received them the next day. This shopping experience made me interested in finding more about its supply chain management.
In this article that I found, it talks about how DSW started as a close-out retailer, and then shifted its strategy in the mid 2000s and became a footwear specialty retailer. Harris Mustafa, who’s in charge of the supply chain at DSW, said that as a close-out retailer, “We didn’t have a lot of choice or control, and the need for planning and forecasting really didn’t exist, but now we needed to do planning and allocation better”.
While on average a DSW store is 20,000 square feet, it still has limited space to keep an excessive amount of merchandise, and thus inventory management is crucial for each store. Just as DSW successfully shifted its strategy and achieved a good inventory and supply chain management, a new challenge has arrived – to continue its focus on physical stores or move to the web?
Based on my personal experience, their online business seems to be pretty good. However, for customers who are looking for more variety of products and flexibility of returns, Zappos is much more attractive than DSW. As customers’ purchase behavior shifts, should DSW put more efforts to compete in online business? If so, how would this affect their physical stores?