Balancing Growth: Stage Stores’ Approach to Logistics and Partnerships

Gough Grubbs, senior vice president of distribution and logistics for Stage Stores, knows that the key to succeeding in many facets of life is being able to achieve balance. Grubbs’ 41 years of experience in logistics – 17 of them with the clothing and home accessories retailer – has shown him that a balanced relationship between a company and its trading partners is always a “win-win” for both parties. “These partnerships could entail interacting with departments within the company or carriers and suppliers outside the company,” he notes.

Grubbs has seen steady growth in Stage Stores’ footprint. “We are a growth company. When I started with the company in ’96, we had 235 stores, today we have 864 stores and plan to hit 1,000 by 2015.” he says. “One of the things you can say about our organization is that we’re not afraid of change. We’ve come to expect it, we embrace it and manage it exceptionally well.”

Balancing its logistics partnerships is just one way the company has been able to adapt to that growth. Adopting new technologies and emphasizing the importance of leadership training are other ingredients that have enabled Stage Stores’ growth.

Transportation Solutions

“Transportation is constantly challenged to cope with rising fuel costs, rates and shortages of available capacity,” Grubbs explains. “The balance is in managing what you can control and not worrying about the components you can’t. We may not be able to control fuel costs and rates, but we can focus on which modes of transportation we use, and anything that impacts shipment cube, like packaging and/or shipment frequency.”

In recent years, Stage Stores has worked with its buyers and vendors to manage shipments. In this way it can find the most cost-effective methods of transportation, whether using full truckloads instead of LTS, or rail instead of over-the-road truckloads.

“The changes, along with the effective use of our TMS [Transportation Management System] by our transportation department maximizing loads, can take a significant bite out of the costs we cannot control,” Grubbs explains.

Grubbs notes that developing relationships with its carriers allows all parties to ultimately achieve balance. “By communicating workload projections, keeping agreed-upon pricing in place and establishing consistency in the work flow, carriers become partners instead of adversaries,” he explains.

Core carriers include American National Logistics, Alliance Shippers, Dynamic International and California Transport Enterprises.

Stage Stores has established a “drop and hook” system for the majority of its shipments that enables better delivery flow and saves the drivers’ time. The driver drops the full trailer upon delivery, picks up the empty one from the last delivery and is on his or her way with no time wasted waiting for unloading of the truck. “The more even the flow, the better the chance that the most cost-effective carriers will have equipment available for us,” Grubbs says.

For shipments leaving one of the company’s three distribution centers Stage Stores uses Forward Air Solutions (FAS). “Stage ships 53-foot trailers of fully loaded store shipments to regional FAS hubs, where they are unloaded and resorted onto route trucks that deliver within approximately 150 miles of that hub,” Grubbs explains.

Changing Technology

One of the biggest changes Grubbs has seen over the years is in technology. “Technology is advancing at a rapid clip and offers many opportunities to save money and improve quality,” he notes.

New technology has enabled Stage Stores to adapt to e-commerce. The company launched Internet sales in December 2010 and had to adapt its space, workforce, systems, and material-handling capabilities to absorb the growth.

Stage Stores uses ProRep, a program by Spalding Software, to measure and reward its employees’ productivity. “ProRep captures and reports individual productivity, which permits us to pay incentive bonuses for performance above the standards set for each function performed,” Grubbs explains. “We believe that productivity reporting for evaluating performance is basic. It allows our associates to immediately impact their own income beyond waiting for the next formal evaluation.”

Creating Leaders

Technology and balanced partnerships would not be effective without the proper leadership. “We’re growing leaders, rather than just managers,” Grubbs says. “Leadership training for both existing management and those candidates identified for supervisory or management positions in the future is a high priority.”

Leadership classes are developed by Grubbs and a team of seven managers and are conducted monthly. “That culture has created a visible potential career path for our hourly workforce into management that encourages them to stay engaged in their jobs, rather than showing up to collect a paycheck,” he says.