Chomp. chomp. chomp. like a modern-day PacMan, Wal-Mart Stores Inc. is gobbling up the retail toy market. Such former highfliers as Toys "R" Us Inc., KB Stores Inc. and FAO Inc. are on the run, if not already out of the game.
Wal-Marts momentum seems unstoppable. That is, until you consider Electronics Boutique Holdings Corp., a West Chester, Pa., company that operates more than 1,500 video game stores in malls across the United States and abroad.
The growing company is moving at a fast clip and stealing market share from the likes of Toys "R" Us, KB and FAO along the way. Recently, it reported a 24.4 percent increase in year-over-year holiday sales.
But competing against Wal-Mart, based in Bentonville, Ark., in the video game market isnt easy. The secrets to EBs success are a laserlike focus on video game enthusiasts and a business-to-business IT infrastructure that keeps EB stores amply supplied with the latest hit games. Equally critical, the B2B process lets the company sack unpopular games even before they enter the supply chain.
"In the 21st century, companies that dont continuously improve will perish," said Mike Mauler, EBs vice president of distribution. "For that reason, were driving improvements across many aspects of our supply chain. Its all about reducing costs and increasing speed to market."
EBs supply chain management system tracks products as they move from the companys warehouses to retail locations. The solution, designed by Atlanta-based Manhattan Associates Inc., includes a WMS (Warehouse Management System) and a TMS (Transportation Management System) that run on an IBM iSeries server.
The system marks the first time Manhattan Associates has fully integrated its custom WMS and TMS software into a single solution. It also links to EBs enterprise resource planning platform from JDA Software Group Inc.
Although EB wont disclose how much it paid for the system, the company praises its performance. Since the supply chain solution went live across three distribution centers last summer, EBs error rate of outbound orders—products shipped from its three U.S. distribution centers to retail locations—has plummeted by 40 percent, according to Mauler.
The supply chain system also has several B2B components, including full integration with tracking systems from FedEx Corp. and United Parcel Service Inc. that allow EB managers to monitor purchases and deliveries as they move from warehouse to retail—or even to a customers doorstep. Those digital features are especially critical as EB competes against online retailers such as Amazon.com Inc. and eBay Inc. and even direct-sales sites operated by Electronic Arts Inc. and other video game publishers.