Case Study- Louis Vuitton

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Table of Contents
1. Introduction 2. The company Louis Vuitton 3. Supply Chain Strategy 4. Constraints of the Luxury Industry
4.1. Supply Chain Strategy of Louis Vuitton

5. Process map of buying process 5.Order Qualifiers and Order Winners
5.1. 5.2. Performance Dimensions Trade-off among Performance Dimensions

6. Internal Operation Practices
6.1. Manufacturing Process 6.2. Customization Point 6.3. 6.4. 6.5. 6.6. Service Package and Service Level Capacity Strategy Forecasting Demand Inventory Strategy

7. Purchasing and Logistics Strategy Practices
7.1. 7.2. 7.3. 7.4. Sourcing Decision Sourcing Strategy Organizing Logistics Interaction with the Final Customer

8. Conclusion 9.
For Louis Vuitton, the requirement of marvelous quality implies a careful selection of firsttier suppliers. Therefore, Louis Vuitton purchases its raw material, such as leather for example from Italian suppliers, form the Tuskany region. Each order for leather raw materials takes on average 6 to 8 weeks for most of the suppliers to be delivered. Those raw materials are than kept as inventory, in Louis Vuitton´s central logistic centre in CergyPontoise near Paris, France. Due to the delivery time of approximately two months, Louis Vuittons maintains 10 weeks of raw material in inventory at Cergy-Pontoise, France. From inventory, the raw material leather gets transferred to one of 12 Louis Vuitton´s manufacturing facilities within France, such as Marraz, Sarras, Staint Donas, etc. At those manufacturing facilities the average total elapsed time that is needed to complete the manufacturing process – the cycle time – is 6 days.

Graphiclal illustraion of Louis Vuitton´s flow of goods within the supply chain

On average, each workforce at one of Louis Vuitton´s manufacturing facilities is able to make 5 handbags per day. After the manufacturing process is finished, the final products are shipped to the central logistic centre in Cergy-Pontoios, France. Form the central logistic centre, the goods are distributed in stock