A first report since Christmas 2011. The specialist in toy retailing looks at its e-commerce activity, which has doubled in size in one year. Interview with Gaël Prigent, Supply Chain Director and member of the management committee, Toys’ ‘R’ Us France.
 

Toys’ ‘R’ Us France opened its online sales site in August 2010. The management of logistics and distribution operations were entrusted to DHL Supply Chain and DHL Global Mail. Nearly two years later, what are the results and the place of e-commerce in your logistics organisation?

G.P.: No surprise that the internet is growing strongly. This form of consumption was the big winner for Christmas 2011. Last year we doubled our e-commerce turnover compared to 2010 and have taken several hundred thousand orders in 2011. This is equivalent to a volumes of 120 truck deliveries between September and December 2011 and 200 vehicles over the full year. Worth noting that, taking all products, toy share of market was 5% in 2010, 8% in 2011 and should reach 15% in 2012. Consumers are obviously very comfortable with ordering by this means.

Have your shops been affected by this trend?

G.P.: Not really, because we are also in a phase of organic growth in our traditional market. We are opening 3 or 4 shops per year- with, in 2012, four new Toys’ ‘R’ Us in Angers, Perpignan, and Evry, and a site to be agreed- but we are also little or not represented in certain regions such as Brittany or Corsica. E-commerce helps to fill these gaps. We can see that e-commerce purchases are made where our network is weak.

At the same time, on line sales are of interest to new consumers…

G.P. : Indeed. These are higher income customers who are prepared to pay more to have fast deliveries without having to travel, especially at holiday time.

What are the delivery periods?

G.P. : 48 to 72 hours depending on what transport method is chosen. We are looking, in 2012 and 2013, to offer delivery times of 24 hours in the Paris region.

Describe your logistics organisation…

G.P. : Overall, we use two distribution centres, at Evry and Monteux. The first covers the north part of the country. The second covers the sites south of the Lyon-Bordeaux axis. For e-commerce, we have in place a centralised logistics and order fulfilment model in a third dedicated site at Villabé (91). This is supplied by Evry.
This specific on line sales strategy is global in nature. For some years we have externalised our e-commerce activity in the US and UK together with Germany (launched in 2010) and Spain (2011).

Does this distribution scheme reflect very different constraints from those in your usual logistics?

G.P. : In effect, in our traditional operations we supply our 44 stores with full semi-trailers. Orders are handled nationally by the purchasing department. Each “universe” of articles (sport, childcare, construction etc.) has its own team managing supplies at each sales point. On the internet, the client chooses delivery method (Kiala, Collissimo, Chronopost delivery points). Different distribution methods are followed.

At a technological level, how do you manage package movements and the flow of information?

G.P. : Our internet site is run on a platform in the US (supplied by GSI), which communicates with both our AS400 database and the DHL information system. We have real time information of predictable stock movements.
In the end, order tracking is complete. Packages are scanned at each warehouse entry and exit. The different stages of distribution are followed in real time by the consumer up to the confirmation of delivery.