tor of operations and fulfillment.
More importantly, the company felt the arrangement did not guarantee the kind of service it felt it
needed to provide. (Dollar Shave Club’s objective
is to ship every order within 24 hours of receipt.)
After giving the matter due consideration, the
company decided that the best way to gain the
flexibility—as well as the level of inventory control, speed, and accuracy—it sought was to cut the
third party loose and bring distribution in house.
ABOUT FACE
Today, Dollar Shave Club has full control of its own
distribution destiny, handling all of its order fulfillment out of two company-run DCs. It opened
its first distribution center, a 110,000-square-foot
operation in nearby Torrance, Calif., in December
2015. That was quickly followed by the opening of
a second facility, a 280,000-square-foot building
in Grove City, Ohio, near Columbus, this past
July.
As for what tipped the hand in favor of the
Columbus area for its second facility, Jackson says
Dollar Shave Club weighed a number of factors
in choosing the site. “We looked at our customer
base, distribution shipping costs, and the ability to
service our customers, as well as for an area with a
good labor pool,” she recalls.
Jackson says the search covered a territory
bounded by Indiana to the west, Pittsburgh on the
east, Michigan to the north, and Kentucky on the
south before settling on the site near Columbus.
Among the factors that worked in Ohio’s favor
were good highway access, proximity to major
carrier hubs, and 11 area colleges that could
feed a steady stream of graduates to the region’s
already diverse labor pool. (Currently, about 110
employees work in the Ohio facility.) It also helps
that 75 percent of the U.S. population can be
easily reached within three to four days from the
Buckeye State.
Distribution territory is roughly split at the
Rocky Mountains. Torrance serves customers
west of the range plus Texas, which accounts for
about 30 percent of total volume. The larger Ohio
facility handles the remaining 70 percent. Both
facilities process only direct-to-consumer orders.
“We distribute and fulfill the same products
from both facilities,” says Jackson. “Both are highly automated, though Ohio has higher capacities
and can handle a little more scale.”
NEAT AND TRIM
Even though the Torrance facility had opened just
a year earlier, the company incorporated some
design improvements into the plans for its new
Columbus DC, according to Jackson. Many of
those changes were made to accommodate the
operation’s scale. Because it would be processing
higher volumes than its counterpart in California
does, the Ohio facility would require automated
systems with higher throughput and speed to
ensure that it could turn orders around in the
desired timeframe.
Bastian Solutions served as the designer and
integration partner in both operations. It also
provided some of the equipment, integrating its
own conveyors and pick-to-light systems with
systems from other manufacturers.
Finding the right integration partner was key to
Dollar Shave Club’s ability to bring distribution
in house. “As a startup company, it was important
to find partners who can flex with us. It’s how we
chose all vendors,” Jackson says. “We don’t have
the standard distribution model. We need the
ability to change what we do easily. That is huge
and has been a big part of our success. We don’t
want to be locked in.”
It’s important to note that when it comes to
fulfillment, Dollar Shave Club enjoys one huge
advantage over most e-tailers in that it handles
only a small number of SKUs (stock-keeping
units). This was a strategic decision arrived at
early on. While many online companies compete
by offering a vast selection of products, Dollar
Shave Club has chosen a different route: selling a
limited number of quality products. It currently
offers a menu of about 30 items, including three
types of razors; blades; shaving, cleaning, and styl-
ing products; and skin care lotions, lip balms, and
wipes. Some of these goods are also bundled with
other items for sale in packages—for example, a
