Doug Marrelli Manager - Lowe’s Global Sourcing. Global Purchasing – Local Retailing.
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Transcript of Doug Marrelli Manager - Lowe’s Global Sourcing. Global Purchasing – Local Retailing.
Doug Marrelli
Manager - Lowe’s Global Sourcing
Global Purchasing – Local Retailing
Agenda
Global purchasing – Some things are different
overseas compared with the United States
Local (USA) – How different are things?
Lowe’s – Information
Lowe’s secret
Local retail customer is #1
Global Sourcing challenges
Changes – Then and Now
Q & A
Local USA
Some things at home that make you go hhhmmmmmm
Lowe’s Information
Lowe’s started in North Wilkesboro, NC in 1946
Over 40,000 skus stocked in an average Lowe’s store
Average over 14 Million shoppers per week Approximately 215,000 employees Over 1,550 stores open
(over 176 Million square feet of retail selling space)
Lowe’s Secret
Who makes most of the purchases for the
home?
Lowe’s 2007 Stats
$48.3 Billion Revenue Ranked #48 on Fortune 500 Opened store in Vermont – 50th state Became international retailer – opened
stores in Canada Opened 153 stores in 2007 (which equates to opening a new store
each and every 57 hours)
Lowe’s - near future
2008 – Plan to open another 120 stores
2009 - Plan to open retail stores in Mexico
Always looking for new opportunities
LG Sourcing, Inc.
Started in 1997
Wholly owned subsidiary of Lowe’sCompanies, Inc.
We have offices overseas staffed withLG Sourcing, Inc. employees
Just makes sense to buy direct from manufacturers, as we have continued to
grow
Lowe’s TEUs Per Year
0
50,000
100,000
150,000
200,000
250,000
2000 2001 2002 2003 2004 2005 2006 2007
TEU
Local Retail Customer is #1
Customers demand good valued product(what they want, when they want it)
More and more good value retail products are manufactured overseas
Need to understand what the local retailcustomer wants, find it overseas
Takes some digging
Global currency issues
1/01/07 1 Euro = us$1.325/20/08 1 Euro = us$1.57
Roughly 19% “increase”
1/01/07 1 RMB = us$0.125/20/08 1 RMB = us$0.14
Roughly 17% “increase”
We buy in us$, overseas vendors pay for raw materials in local currency
China – sourcing pressures
Exchange rates
Raw material costs
New Labor laws
VAT rebate changes
Other global sourcing options
Vietnam
Thailand
Malaysia
Cambodia
Etc.
Changes – Then and Now
Then Now
Burma Myanmar
Ceylon Sri Lanka
Dutch East Indies Indonesia
East Pakistan Bangladesh
Container shipping did not exist
Over $5.5 Billion worth of everyday goods
move in and out of US ports EACH DAY
Q & A
Thank you