Clothing brand gained hidden contribution profits of $262,491 within 7 months

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Top 20 clothing brand has reduced its shipping
costs by 43% with help of Nyle.ai

Industry:

Clothing & Shoes Department

Location:

USA

Company Type:

Private Label Brand

Marketplace:

Amazon USA, Amazon CA

After beginning to work with Nyle.ai, our clients have drastically improved their efficiency by switching their shipment methods from Standard Parcel Delivery (SPD) to Full Truck Load (FTL), resulting in increase of total annual contribution profits by 28%

Using Nyle.ai, our clients achieved
the following results:

Logistics team
productivity

+ 49%

Storage Fees

- 47%

Shipping costs

- 43%

The Challenge

Overstock storage costs and frequent "Out Of Stock" issues that led to the loss in sales of $142k and damage in rankings.

Costs in FBA
shipments

+$0.32

$0.3-0.7 per lb

Overstock
Storage Costs

+$0.05

$0.63 per lb

Lost Sales and
Damage of Ranking

+$98K

$142k

The Solution

Not only we came up with an effective strategy to update
the shipping processes to FBA but we also eliminated the "Out of Stock" events, which have occurred during an active product line expansion.

By reduction SPD ratio of shipments (from an average cost of $0.70 to $0.26 per lb) and LTL rates optimizations with the partner program, eliminating of Out Of Stock events and implementing qualitative planning, they were able to achieve massive shipping cost reduction.

Optimization
of international
shipments

-$0.44

$0.70 → $0.26
per lb

LTL rate
optimizations

-$0.12

$0.22 → $0.10
per lb

Since they stopped keeping large amount of stock with low sales velocity, they started to see significant savings on storage fees. As we started to plan well ahead, we were able to stock up for at least two weeks. Now we started to send out FTL shipments (Full Truck Load) every month with at least 4 weeks of coverage.

SPD ratio in total shipments 100% → 10%

By packaging their product lines together for maximum cost effectiveness and by using predictive analytics to forecast future demands, they were able to decrease the number of SPD deliveries from 100 percent to 10 percent and replace them by LTL shipments.

With Nyle.ai AI’s optimization process, the client was able
to significantly improve its Amazon IPI score and boost inventory planning performance by 11%, as well as increase the speed of new shipment and PO creation by 78%.

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