Family Dollar 2003 Annual Report Download - page 14

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Supply Chain
Family Dollar
We’ve Still Got a
Long Way to Grow
In recent years Family Dollar has reengineered its core supply chain processes, supported by software ranging from new
inventory management tools, to new distribution systems to new systems for merchandise allocation and replenishment.
Today, we have one of the best supply chain infrastructures in retail. Importantly, these investments position us to continuously
improve inventory productivity in the years ahead.
With all that has been accomplished, the supply chain remains an area of intense focus and investment. In 2003, Family Dollar
began implementation of a new transportation management system which will improve the visibility and cost control for both
import and domestic freight movement. The Company also purchased new statistical modeling tools which are now being used
to improve performance analysis in diverse areas from inventory turnover to distribution center productivity. The Family
Dollar distribution network continued its expansion with the opening of a seventh distribution center located in Odessa, Texas,
and plans call for construction to begin on an eighth distribution center in 2004.
Merchandise planning and space management are also being improved and will be key areas of investment in coming years
as we look to better meet our customers’ needs while maximizing the sales and profit potential of our stores’ square footage.
Family Dollar’s excellence in the supply chain is a core competitive advantage that will grow to support our aggressive
expansion plans.