Client
FARM Rio is one of Brazil’s most recognizable and beloved women’s fashion and lifestyle brands and growing rapidly. They distribute dresses, jackets, and accessories direct-to-consumer (DTC) and through traditional brick and mortar retail stores.
Challenge
The company was experiencing significant growth pains with 50% growth over a three-year period. FARM Rio approached Shipware, an SIB company, with several challenges. The cost of their third-party logistics (3PL) support was rising while service from their incumbent provider was declining.
The challenges were affecting customer experience:
- Inventory management issues
- Declining turnaround times / slower order processing
- Inaccurate orders
- No contractual service level agreements (SLAs)
Attempting to resolve the problem on their own only delivered minimal improvements. Having leveraged the same U.S. and European 3PL for several years, the FARM Rio team was unsure of alternative global 3PL options and had no access to 3PL pricing benchmarks, so they tapped SIB’s Shipware team to help.
Solution
Our team performed a comprehensive current state assessment of FARM Rio’s fulfillment operations including:
Reviewing operational issues and determining root causes
- Evaluating FARM Rio’s contract terms and pricing against our industry benchmarks
- Reviewing historical and anticipated growth rates and drivers
Once our assessment was complete, we collaborated with FARM Rio’s stakeholders to define priorities, which were to eliminate service issues, improve customer experience, reduce costs, and develop and implement SLAs.
We then developed a five-step 3PL optimization strategy. Download the case PDF to learn more about the five-step process.
Results
We reduced costs and enhanced FARM Rio’s operations—positioning them for accelerated global growth while maintaining excellent customer experience standards.
- $1.1 million in annual cost savings to FARM Rio.
- 80% of U.S. duties and taxes eliminated
- New 3PL fulfillment partner procured and implemented
Shipware helped select a cross-border Mexico-based fulfillment partner with the necessary expertise in apparel to hit FARM Rio’s turn time, accuracy, and inventory management targets. In addition, we substantially lowered transactions costs by leveraging Maquiladora and Section 321 Programs from the Trade Facilitation and Trade Enforcement Act of 2015 (TFTEA0 to eliminate 80% of U.S. duties and taxes.
Read the Case Study to Learn More
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