COSMAX TRANSFORMS ENTIRE WAREHOUSE OPERATION with Manhattan Associates

• Functional Applications - Warehouse Management Systems (WMS)
• Application Infrastructure & Middleware - Data Exchange & Integration

• Consumer Goods
• Retail

• Warehouse & Inventory Management
• Logistics & Transportation

• Inventory Management
• Warehouse Automation
• Predictive Replenishment

• System Integration
• Software Design & Engineering Services

Cosmax faced significant challenges in their warehouse management processes, primarily due to the lack of strict standards of procedure (SOPs) and inadequate visibility across the supply chain. The in-house warehouse management system they previously used was not sophisticated enough to support the company's growth, leading to poor inventory accuracy and picking productivity. Additionally, there were considerable discrepancies between the inventories logged on their ERP system and the actual inventory in their warehouses. Cosmax also struggled with a high volume of slow-moving inventory, with almost 40% of their inventory being slow-moving. The company lacked an effective order picking process and was unable to forecast inventory returns from their production site, resulting in a high number of returned packaging materials.

Cosmax is the largest Original Development Manufacturer (ODM) of cosmetic products in the Korean market. Founded in 1992, the company adheres to three key principles: Ethics, Science, and Aesthetics. Cosmax is renowned for its commitment to business best practices, continuous investment in world-class R&D, and contribution to society through health and beauty products. The company employs 282 staff and invests up to 7% of its annual revenue in R&D, developing up to 2,700 new skincare and makeup products each year. Despite its success, Cosmax faced challenges in warehouse management, prompting the need for a more sophisticated solution.

To address their warehouse management challenges, Cosmax decided to implement a warehouse management solution from an external vendor. After reviewing several vendors, they selected Manhattan SCALE due to its proven track record and breadth of capabilities. The primary objective was to maintain accuracy of both packaging materials and finished goods inventory, and to better manage the movement and storage of goods, including returned goods. Manhattan SCALE integrated well with Cosmax's existing ERP system, which was crucial for their decision. The implementation of Manhattan SCALE led to several critical improvements in Cosmax's warehouse operations. One significant improvement was the creation of the 'Case Round-Up Rule,' which allows inventory to be picked using case UOM and the FIFO rule. This rule ensures that only the required amount of inventory is picked and shipped, reducing the volume of returned goods. Additionally, Manhattan Associates helped Cosmax develop SOP manuals for all warehouse management processes, including picking. Another benefit was the 'put-away' rule, which ensures cases are allocated with a specific code or LPN, helping Cosmax strategically manage inventory storage in the warehouse.

• The implementation of Manhattan SCALE led to the development of the 'Case Round-Up Rule,' allowing Cosmax to pick and ship the exact quantities of inventory needed, reducing the volume of returned goods.
• The 'put-away' rule configured by Manhattan Associates ensures that goods are received and stored correctly, improving inventory management and reducing safety hazards in the warehouse.
• Cosmax achieved greater inventory accuracy, with returns now regarded as another type of receiving and combined with inventory.

• Reduced the quantity of goods returned to the warehouse by 75%.
• Reduced overtime hours per warehouse worker by 16.6%.
• Raised overall productivity by 30%.