Huggo Boss
Synopsis: “Katja Ruth and Constantine Moros sat facing each other in the empty conference rom. Covering the table between them were the latest operational and financial figures from the supply chain optimization pilot Hugo Boss had been running in its global bodywear and hosiery Division. Ruth, the director f the division, agreed with Moros, the division’s head of operations and procurement, that the pilot had been a success- better product availability and lower inventory to sales ratios had been observed for the stock-keeping-units involved in it- but was not convinced that the expansion of the initiative beyond those SKU’s would enjoy the same success. With Hugo Boss’s chief operations officer expecting her assessment in a few days, she and Moros had a lot of work to do. They needed not only to precisely quantify the pilot’s financial impact, but also to determine whether the initiative should be rolled out to other products. Hugo Boss’s two distinct brands, Hugo and Boss, were divided into five subsidiary lines- HUGO, Boss Black, Boss Green, Boss Orange, and Boss Selection- designed to meet the needs of specific men’s and women’s fashion segments. The bodywear and hosiery division produced bodywear, hosiery, terrywear, and swimwear products for Boss Black, Boss Orange, and HUGO, and loungewear and nightwear products for Boss Black. The division was further segmented by replenishment type. The division’s 711 product SKU’s included a wide selection of men’s underwear variously classified as Selection, News, Athletic, Basic, and Packs styles. Styles differed in terms of raw material composition, cut, elastic type, and color, each style being sufficiently different that an average customer would be unlikely to substitute one style for another. The majority of the 513 SKU’s of Boss Black bodywear and hosiery products were classified as Never Out of Stock (NOS) products to discourage customers from substituting similar product offerings from competitors.