Purchases at world pace

To accelerate, to confirm its style and to massify: these are the three issues at stake for PPR in its purchases.

Reactivity
Glenda Wee manages the 6 textile purchasing offices of Redcats Group: in China (2), Hong Kong, Bangladesh, Turkey and India. Each area has its own strong points and niches: “basics” in Bangladesh, “fast fashion” in Turkey and dresses in India and China. Amongst the 900 referenced suppliers, half of them are located in China and Hong Kong. In fact, they represent nearly 60% of the total business. Fabric is being used more and more quickly. The Chinese government has just revaluated the Yuan, the cost of property and equipment is rising and the authorities are encouraging industrialists to abandon basics in favour of value added items: embroidered, printed…Yet the major evolutions are coming from the demand: “We have gone from 2 big collections to 4, then to 8 new stocks per year”, points out Glenda Wee, who adds: “The schedule has been reduced from 6 to 2 months. Doing an increasing amount of business on the internet is making us a lot more responsive to the change”.
Style
Conforama differentiates 2 categories of purchases: the products conceived by the suppliers and those that are developed by the brand. The issue is achieving a balance between the two. Designing your own products requires more time in the early stages, yet it offers the possibility of defining a style, of offering an exclusive product and to develop it more quickly. Before the end of the year, Conforama is going to launch its own range of small, solid wood furniture and will do the same in 2008 with a collection based on panels (beds, wardrobes, chests of drawers…). “The aim is for the products created by Conforama to reach 20% between now and 2010”, specifies Jean-Philippe Dumont, Conforama’s Managing Director of Sourcing ( IHTM ¹)
Massification
Within Redcats Group, the use of purchasing offices by the “Home and Lifestyle” Division is continually progressing: 18% of purchases in 2006 and 35% predicted for 2008. A fact that Thibaut Derville, Development Director of Redcats Group is delighted with: “By using these offices, we have a tighter control over the entire chain, from the conception of the product to its delivery”. This market is characterised by its many suppliers (1 300 for Home) and by the large sector occupied by anonymous products or those of distributing brands.
Redcats Group must endeavour to create inter-subsidiary synergies. Thus, certain purchasers are in charge of visiting the individual brands in order to identify what can be communally achieved: 20% of the Group’s purchases in household linen are now standardised.

¹: International Home equipment Trade Marketing