MICHAEL B. BARRETT

Nov 01, 2000 10:30 PM  By

What got you started in distribution?

My family ran cut-and-sew factories, and I started working there when I was 15, cleaning toilets and working summers. My first job out of college was with a company called Sonoco Products, a paper manufacturer. I worked there for five years. When I left there I went to QVC.

Describe some highlights of your career.

Working with a new management team and successfully revamping the entire CVS/pharmacy facility in Alabama. If you made a list of all the things that could be wrong in a facility, this one had all of them and more. Also, training hundreds of people to use statistical tools for problem solving. Many had very little education, but they used these tools to improve operations. The look of accomplishment on their faces was gratifying.

Why were you attracted to this line of work?

I get bored easily. I found that the challenge in distribution is that you need to bring a lot of activities in-house and manage them profitably. You have different seasonal merchandise, and you’re constantly re-profiling your building. There’s never a dull day. And the consequences of the decisions you make are instantaneous.

Can you elaborate on that?

I think when you’re in a distribution environment where you’re fighting time lines and a huge facility like the one I’m in, you can make a decision that in an hour can have a negative impact that is hard to overcome. It’s like turning a battleship versus turning an aircraft carrier. Once the carrier starts to turn, it is difficult to change its momentum. A lot of the decisions in this business come up five minutes from now and have to be resolved ten minutes from now.

When I was in manufacturing, specifically in our garment industry, we had full runs of a product that we had planned from beginning to end. It was pretty much a set process, and there weren’t many variables that came into play in the operation. In distribution there are so many variables that can come in when you consider warehouse management systems, labor resources, and customer expectations. Then you have all the inbound receiving issues to deal with if vendors are late. There are so many factors that can really affect you if you don’t make good decisions very quickly.

So someone who went into distribution would have to be comfortable doing that.

You’ve got to be able to think on your feet and do that accurately. It’s one thing to be able to make a decision quickly, but you’ve got to be able to make the right decision. The man or woman that can make the right decision is the one that’s going to have the easier life in this business.

Do you think a single facility can cope with fulfilling orders from various channels, such as retail, online, and catalog?

If you’re smart, you can do all those things in one facility and gain a lot of synergies. Managing buildings and technology is similar for various types of orders, and if you can build a facility for flexibility, you can still maximize throughput. But I also think there’s a role for third-party facilities that can handle Internet start-ups. Ultimately, the people who win the fulfillment game are those who can move the packages the fastest and not go into the red doing it.

There has been an explosion of interest in supply chain management, logistics, electronic data interchange, and other related topics. To what extent do you apply these to your job?

Supply chain management has had a bigger impact on retail than some of the other disciplines, because the whole cost of goods in distribution depends on managing the supply chain from front to back. Supply chain technologies have had an impact on how we manage inventory. You need to identify the key supply chain components that best apply to your needs and use them fully.

The dwindling labor market must certainly have an impact on your business.

We’re investing in recruitment and hiring more than ever before. Our business is seasonal, and retaining people is a problem. We try to value and respect employees at all levels. Our workers are the experts – they’re the ones out there doing the job all day long. We make sure that we are accessible to them, and that when we are accessible, we listen.

Has your listening paid off?

Yes. For example, there are 1 million square feet and 80,000 SKUs in this building, and here you live or die by profiling. We successfully changed our merchandise profile by shifting the face of the picking areas. By listening to input from the shift managers, supervisors, and pickers we reduced the amount of air picking by 50%. It’s much more efficient to pick on the ground.

Another thing we do to communicate with employees is hold birthday meetings every month. We meet over cupcakes and punch, and it gives us the opportunity to interact in a smaller group so we can hear the needs of our people.

How do you deal with customer service issues?

The way we deal with customer service issues is: quickly. We strive to keep order accuracy and delivery times in front of supervisors and managers constantly. As a company, we also provide a lot of customer service training and retraining for the people dealing directly with these issues on a daily basis.

Where would you like to go from here?

I’m a pretty aggressive guy. I’ve worked hard to get where I am, and I’m a person who doesn’t like people looking over my shoulder. I like being independent. I’ve had a good foundation in manufacturing, because of working in my father’s business, and that has taught me how to be more entrepreneurial and mature as a businessman. I would like to use those qualities in an executive role.

What is the future of distribution?

The sky’s the limit in direct-to-customer distribution. No matter where products are made, they need to be distributed. It’s a great industry to be in, and we’re just at the forefront of what is possible. We can push the envelope in distribution if brick-and-mortar and electronic retailing work together. The grocery business is a great example. Before you left work, for instance, you could order groceries over the Web or by phone, and pick up your order at the store on the way home.

Technology clearly plays a prominent role in this.

Yes. In fact, the next generation of warehouse management systems is likely to be Web-based systems that manage the whole supply chain. UPS and Miller Brewing Co. have implemented this technology. That type of system has enabled Miller to reduce breakage by 50,000 bottles a year in its North Carolina brewery.