Plow

1
Plow Hearth

• Melissa Daly
• Kelli Johnson Watson
• Christina Wright

2
Plow Hearth
3
Plow Hearth

• Plow Hearth (PH) is a mail order catalog
  company specializing in products for country
  living.
• In operation over 20 years
• Works with 350 vendors
• Offers 4,000 products per catalog
• One major issue is Inventory Risk

4
Plow Hearth

• PH operates six catalog titles
• PH Products for Country Living
• PH Country Homes
• PH Problem Solvers
• Hearth Song
• Magic Cabin Dolls
• Pop Corn Factory

5
Plow Hearth

• History and Operations
• Company Background
• Industry Background
• Strategic Emphasis
• Operational Analysis
• Overall Assessment

6
Plow Hearth

• Company Background
• 1980 Founded by Peter Rice
• 1981 Launched first catalog operation
• 1986 thru 1989 Listed in INC. magazine as one
  of Americas fastest growing companies
• 1998 Wholly owned sub of 1800Flowers.com
• 2001 Second distribution site Vandalia, OH

7
Plow Hearth

• Company Background (cont.)
• Corporate headquarters located in Madison,
  Virginia
• Employs in excess of 200 associates year round
• During peak times, hires an additional 700
  temporary employees
• Currently operates two retail stores and two
  catalog outlet stores.

8
Plow Hearth

• Industry Background

9
Plow Hearth

• Strategic Emphasis
• 1993 PH selected as a finalist and in
• 1994 selected as a medallist for the United
  States Senate Productivity and Quality Award for
  the State of Virginia.
• Much of our success is due to the quality of our
  products and our liberal customer service policy
  Jeff Dillon, Inventory Control Manager, PH

10
Plow Hearth

• Operations Analysis
• Marketing
• Merchandising
• Creative
• Inventory control / Purchasing
• Order Processing / Customer Service
• Fulfillment / Distribution

11
Plow Hearth

• Overall Assessment
• PH has experienced tremendous success in the
  mail order catalog industry by providing quality
  products and exceptional customer service.

12
Plow Hearth

• Inventory Management
• Inventory Planning
• Vendor Makeup
• Products
• Establishing Guidelines
• Assessing Vendor Performance

13
Plow Hearth

• Inventory Planning
• Planning the first 12 weeks
• Reacting the second 12 weeks
• End of session the final two weeks

14
Plow Hearth

• Vendor Makeup
• 300 400 vendors per catalog
• Range from Mom Pop to large organizations
• Same policy implementation for small, medium and
  large sized vendors

15
Plow Hearth

• Products
• Sell over 4,000 products per catalog
• Unique verses made specially for PH
• Single source vendors supply 99.9 percent of
  products for PH

16
Plow Hearth

• Establishing Guidelines
• Vendor Operating Procedures
• Service expectations
• Quality assurance
• Shipping instructions
• Packing marking instructions
• Where to ship
• Invoicing instructions
• Overages/duplications/other shipping problems
• Vendor charge-back violations sections

17
Plow Hearth

• Assessing Vendor Performance
• No formal vendor rating system
• Risks when dealing with vendors
• Company policy that when the product is that
  good, the IC department is responsible for making
  sure everything runs smoothly with the vendor.

18
Plow Hearth

• Vendor Relation Scenarios
• Catalog Life Cycle
• Actual scenarios

19
Plow Hearth

• Catalog Life Cycle
• Planning the first 12 weeks
• Reacting the second 12 weeks
• End of session the final two weeks

20
Plow Hearth
21
Plow Hearth
22
Plow Hearth
23
Plow Hearth
24
Plow Hearth

• Recommendations

25
Plow Hearth

• Vendor Report Cards
• Provide Incentives to Vendors
• Decrease percent of Single Source Vendors
• Increase percent of Direct Shipping
• Communicate with Vendors via Extranet

26
Plow Hearth