Brookstone, Inc. is a product development and specialty retail company that operates more than 305 Brookstone brand stores nationwide, including Puerto Rico. Typically located in high-traffic regional shopping malls, lifestyle centers and airports, Brookstone stores feature unique and innovative consumer products, which have earned the company a number of function and design patents. The company also operates a direct marketing business through two catalogs—Brookstone and Hard-to-Find-Tools—and its web site, www.brookstone.com.
Slotting has always been a challenge in Brookstone's operations, primarily due to the frequency of new item introductions. Brookstone's distribution center (DC) employees regularly receive instructions from the company's merchandising team to expect orders for new items. For each new item, DC employees would have to physically look for an empty location, estimate space requirements and assign the new pick slot. Brookstone knew the rules for optimum placement, but was operating on a manual basis with limited and often inaccurate information. According to Chris Belden, vice president of distribution, "Slotting was a virtual guessing game that was repeated frequently due to an average 30 to 40% annual turnover in our SKU mix."
Another challenge for warehouse personnel was maintaining two separate slots for the same item—one for retail and one for direct-to-consumer picking operations. Though direct and retail orders are fulfilled from the same facility, movement of an item through one channel was not always similar to movement through the other channel. Poor visibility into historical movement not only complicated optimal slot assignment, but also hampered attempts to identify slow-moving items to free up space.
