VF is the world’s largest apparel company: about $ 10 billion annual revenues, 30 dynamic lifestyle brands, sold in 150 countries through 47,000 retailers and 1,000 own retail stores. Headquartered in Greensboro, North Carolina, the Global Supply Chain Organization, based in Hong Kong, oversees the production of 500 million items annually at more than 1,400 owned or sourced facilities in locations around the world.
Asia is very important to VF, both from a sourcing and sales perspective. The growing Chinese market is now serviced from three warehouses based in Guangzhou, Shanghai and Beijing. The first two act as a central warehouse for a selected number of brands and deliver to the other warehouses and wholesale customers.
Buck Consultants International has reviewed the current network structure taking future growth and market requirements into account. The outcome of the DC network review was to centralize inventory into a Central Distribution Center (CDC) in the East China region and support VF retail activity with satellite DC operations in Beijing and Guangzhou supplied from the CDC.
BCI conducted a site selection process and made a trade-off between insourcing and outsourcing the operation. Based on BCI’s recommendations, VF has selected Kunshan, Zhangpu town to locate its CDC; VF's preference is to control the building, design, construction and partial fit-out of the CDC. A third party logistics service provider (3PL) is selected to manage and execute the operation. BCI made an overview of the 3PL market in China and managed the entire RFQ process including the contract negotiations.