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July 13, 2023
We live in an era of disruption. New business models continue to upend the conventional. More often than not, those business models lead to new distribution models and networks. Such was the case for thredUP, a marketplace bringing next generation technologies like machine learning and automated goods-to-person storage and order fulfillment to a channel we normally associate with small, neighborhood retailers and non-profits: The thrift shop.
Back in 2016, thredUP came to a realization: The bottleneck to increased sales was its distribution processes. If it could redesign its largely manual handling processes from receipt to shipping, it could process more garments and increase sales.
“We needed to increase our inventory capacity to meet growing customer demand,” notes John Friedl, senior vice president of automation and innovation. “In the past, that meant building new distribution centers, which was time consuming and costly. Instead, we began considering alternatives for increasing storage capacity within the existing facilities.” At that time, the network included four manual DCs.
The results have been significant since rolling out the technology in all four of thredUP’s facilities nearly six years ago. “We currently have the capacity to hold nearly nine million unique items across the network with the capacity to hold an additional 7.5 million in the future,” says chief operating officer and co-founder Chris Homer.
Inventory capacity has increased by more than a factor of three, pick and putaway efficiency has increased six-fold and operator efficiency at the packout stations has more than doubled. Friedl notes that the company realized a positive ROI in less than 24 months on the first system. With a nearly 600,000-square-foot distribution center in Lancaster, Texas, now online—the company’s largest—thredUP has the capacity to process more than 100,000 unique items per day across the network.
Read the full article here: https://www.mmh.com/article/thredup_designs_the_largest_resale_platform_on_the_web