Posts Tagged ‘Fashion’

Matalan Selects Quantum Retail’s Software for Store-Level Replenishment

by Quantum Retail • July 27th, 2010 • Write a comment »

LONDON & MINNEAPOLIS (BUSINESS WIRE) –
Quantum Retail, a next generation merchandising optimization software provider, is pleased to announce that Matalan, the United Kingdom’s leading value fashion and homeware retailer with more than 200 stores, has chosen Quantum’s Q software to optimize store-level replenishment activities. With a deep understanding of shopper behavior and merchandise strategies, Matalan hopes to service its customers better.

“Matalan recognizes the urgency and importance of aligning their inventory investment with their customers’ continuously changing demands,” commented Chris Allan, Quantum Retail’s chief strategy officer. “Q will assist Matalan in better meeting those demands by understanding localized inventory behavior.”

With Q: Allocation and Replenishment, Matalan can now monitor and react to the unique customer behavior in real-time at each store to easily determine inventory need throughout its supply chain.

“We expect significant results from a leading edge technology like Q,” stated Andrew Scott, Matalan’s head of merchandise planning. “The system is a necessary investment that will enable us to understand exactly what our customers want and need at every location so we can provide them unparalleled service.”

Quantum Retail, winner of Supply Chain Solution of the Year and Supply Chain Excellence awards, offers Q to retailers seeking a hyper responsive, consumer driven, merchandise optimization platform to localize inventory placement and increase sales, profits, and inventory efficiency. Solutions include Allocation and Replenishment, Forecasting and Order Planning, and Assortment and Range Planning.

Matalan joins Quantum Retail’s growing list of successful clients, including Marks & Spencer, New Look, Kohl’s, and Guitar Center.

About Matalan

Matalan is a leading UK ‘value’ retailer, with annual sales of GBP 1bn through 200 stores. Matalan recently reported an increase of 30% in annual profit. Womenswear accounts for 35-40% of sales, followed by menswear at 25-30%, and childrenswear 10-15%. The remainder is made up by homewares, accessories, footwear, luggage, books, videos, etc. Matalan’s prime target market is 25–55 year old women with families.

About Quantum Retail Technology, Inc.

Quantum Retail answers the new questions facing retailers with a merchandise optimization suite designed for the increasing pace and complexity of the consumer revolution and today’s competitive landscape. Quantum Retail’s award winning solutions solve the most difficult and costly problems retailers face — quickly and permanently.

The Q solution is the new answer for: Forecasting and Order Planning — Replenishment and Allocation — Assortment and Range Planning.

Read more about Quantum Retail»

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Fashion Innovation Series: Part 2 – Assortment Planning and Range Planning Localization

by Chris Allan • April 25th, 2010 • Write a comment »

This is the part 2 of a 4 part series on Fashion Innovation and Optimization.

KEY TOPICS IN THIS SERIES:

  1. Size & Pack Optimization
  2. Assortment & Range Planning
  3. In-season Replenishment
  4. Allocation Optimization

Look out for part 3 next week, to read part 1 – CLICK HERE. Please engage, start a discussion, or leave a comment if you like this post.

Assortment and Range Planning Localization

Customer behavior has changed…unfortunately retailer processes and systems have not kept up with the pace of that change. The way that stores are assorted needs to change – to reflect how and where the customer now wants to shop and what they want to spend their money on.

Retailers need to focus on changing the way that they plan their assortment and identify opportunities to align their offering with their customers, to drive profitability of every product in every store. To achieve this, retailers need to identify not only the financial objectives for each product in their assortment, but also the merchandise objectives – as these are key to creating a credible offering in the eye of the consumer.

The most important, but over-looked questions for assortment optimization today:

Why is this product in my assortment?

What strategies do I have in place to decide what products to include?

How am I measuring the performance of my assortment on a continuous basis?

How will this product perform in the future?

How am I aligning my assortment with local demand?

When retailers align both the breadth and depth of their merchandise offering with the localized demand of their customers, it increases full price sales and product availability, and ultimately lowers markdown spend.

There are two main areas in planning that retailers should focus right now:

Sku rationalization //

How well is the breadth of the offering aligned to the customer? It is important to identify where you have too many or too few choices for the customer and have the flexibility to execute on those decisions. If you are not doing this, you are creating both markdowns and lost sales. Retailers need to keep this flexibility and continuously monitor the profitability and contribution of each product. This will allow each store to reveal its own patterns and tell the retailer how to best align their SKUs with local demand.

Localizing inventory //

The customer is the most important element of today’s retail strategies. In order to compete in today’s market – retailers of all verticals need to focus on availability and local consumer behaviors. This kind of granular detail cannot be obtained with traditional, data aggregating systems. Retailers need to remove the simplification from their inventory planning process and focus on real-time local demand. This means creating a dynamic inventory plan that is highly reactive to local demand fluctuations, allowing the retailer to be flexible and respond to how their customers are behaving now. This allows the customer to have product available when and where they want it, in the right size, the right color, and the right style at every store and in every channel.

5 Ways to Innovate Assortment Planning

1. Optimizing inventory:

Retailers need to focus on optimizing their assortments and shaping their offering based on both the merchandise and financial objectives of those products. Many retailers are focused on shrinking their offering, but fewer wrong products will not create more sales, it will only frustrate customers. Investing in the right brands and the right products will ultimately bring new energy to the retail market. Understanding exactly where the offering should be contracted or expanded is they key to achieving those goals.

2. Better placing inventory:

Some of the best retailers have not scaled back on their inventory investments, but focused instead on where to place their inventory. Over the last year, ‘flat’ was the new ‘good’, but by putting inventory where there is demand, retailers can increase their sales and profit, while better serving their customers at the same time. Retailers can also hold back inventory to see where it is performing best – and use precision placement of their remaining inventory to increase profit and create fewer markdowns.

3. Increasing availability:

Focusing on which products need to be made available at what locations and when is a difficult task. But when the right products are available, in the right sizes and colors and in the right amounts, stores increase sales and increase customer service levels.

4. Focusing on the intelligent consumer:

The market has shifted with the intelligence of consumers. The economy has further focused the customer on seeking out the highest value for the lowest cost. The environment has also brought to light new values and new criteria that the customer has begun to judge products on. Retailers need to recognize the needs of their customers and give them products that meet these new expectations – and remember, these expectations will continue to change.

5. Focusing on newness:

If a retailer can continually have something new for the customer to see, it will increase the frequency of customer visits and increase turn rates. This is especially important in fashion and consumer electronics, where customers have become increasingly knowledgeable and demanding. If a retailer can keep up with the pace of fashion, they’ll be able to keep their inventory fresh and unique.

LISTEN >>

Learn how to implement better planning practices to manage the breadth of your assortment

Chris Allan, Chief Strategy Officer, Quantum Retail

Audio clip: Adobe Flash Player (version 9 or above) is required to play this audio clip. Download the latest version here. You also need to have JavaScript enabled in your browser.

You can also follow our 4-part 2010 Retail Outlook series here.

If you’d like to be emailed PDF’s of this series as they come out, make sure to sign up for the email series updates! (we will only send you email for our retail series reports)

Get back in the game

Are you ready to know exactly what your customers are asking for at every location and to have the ability to react as their wants change? If you are looking for a solution that can drive momentum for your business this year, check out the solutions offered by Quantum Retail. Our customers see valuable results in 8 to 12 weeks and our implementation approach gives your team access to the system from early on, so you can manage changes to your processes with ease. Quantum Retail continues to help all of its clients drive positive business value more rapidly than anything seen in retail.

For more information, visit: http://quantumretail.com/services/size-pack-optimization

Download this blog as a PDF.

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Fashion Innovation Series: Part 1 – Size Optimization & Pack Optimization

by Ziad Nejmeldeen • April 20th, 2010 • Write a comment »

This is the part 1 of a 4 part series on Fashion Innovation and Optimization.

KEY TOPICS IN THIS SERIES:

  1. Size & Pack Optimization
  2. Assortment & Range Planning
  3. In-season Replenishment
  4. Allocation Optimization

You can also follow our 4-part 2010 Retail Outlook series here.

If you’d like to be emailed PDF’s of this series as they come out, make sure to sign up for the email series updates! (we will only send you email for our retail series reports)

In fashion retail, Size and Pack Optimization are key

Local demand changes at every store on a daily basis. Clustering stores together by store size and geography might simplify the process, but is inefficient and does not take into consideration individual store patterns for size, color, style and quantity of local demand and product preference.  Retailers need to monitor the changing demand at every store to align their assortment in the way that is most profitable and aligned to their strategic objectives.

It sounds like a no-brainer, but when supply chains become complex, retailers cannot keep up with store level demand and will send the same amounts of every product to similar store types. However, localization of store level assortments and order plans is proven to increase availability, full price sales and customer satisfaction. It is also proven to reduce overall inventory, wastage and markdowns which all erode margin.

Understanding how a product will sell through its entire life on a location by location basis – is essential for:

  1. Meeting sku/store demand: i.e. avoiding missed sales opportunities
  2. Reducing sku/store over-allocations: which would otherwise be dealt with through markdowns
  3. Minimizing handling costs: as the inventory makes its way from vendor to warehouse (where applicable) to store
  4. Reducing Markdowns: by having the appropriate level of inventory and the best assortment possible

The initial assumption of the product assortment is an important part of the process. Retailers need to know what is selling where and why, they need a strategy and goal for why that product is in their assortment and they need to make sure they can  continuously re-evaluate how they expect the product to sell – in real time. This enables retailers to understand which stores will offer the greatest potential for full price sales – and appropriately decide what inventory is best and where.

When they can pinpoint the demand at their stores – they will cut distribution costs and decrease lost sales. With the ability to assign specific pack sizes will also help retailers get the exact amount of inventory to every store and reduce markdowns.

Get the right product in the right place and fulfill based on product performance //

The objective is clear: get the right product in the right place to start with – then fulfill based on how products are really performing at each store – giving the product the best chance to sell at full price and identify when and where markdowns are truly necessary.

Size, pack and prepack innovation for progressive retailers

Size Optimization uses historical sales and inventory data at the size/store level to infer historical demand, and then aggregates demand across groups of items and/or locations. Items are grouped according to the size run, attributes of interest, or merchandise classification that they share. This aggregated demand, when normalized across the sizes that compose a size-run, yields a Size Profile. These size profiles can be used pre-season to impact the size buy for the chain, or in-season to impact store-specific size allocations.

Prepack Optimization refers to the pre-determination of  prepacks that contain fixed quantities of each size in the size run. Like size profiles, prepacks can be defined for groups of products where the grouping is defined by size run, specific attributes, or a common merchandise classification. Unlike size profiles, prepacks are not store-specific – a given pre-pack can be allocated to several stores, if not the entire chain.

In the most trivial cases, Prepack Optimization can be considered a by-product of Size Optimization. Suppose that we want an n-pack solution, have designated that each store should only receive one type of pack, and have pre-determined the approximate number of units in a pack. Then, we can cluster store-level size profiles into n clusters, and use each cluster size profile to determine the optimal cluster pack by multiplying the size profile by the pre-determined number of units and rounding the resulting size units to the nearest whole number.

However, pack optimization becomes more interesting when each pack in a solution can go to all stores, or when the pack quantity range is broad, thereby requiring optimization of the units in the pack. In these cases, you need more sophisticated approaches to obtaining the optimized packs – approaches that utilize historical store/size demand, allocation quantities, and pack handling costs.

Localizing sizes and packs and rationalizing SKUs:

In order to optimize sizes and rationalize SKUs at a local store level you need an acute awareness of product behavior. There are dozens of product behaviors unique to every store. In order to analyze these behaviors, retailers should optimize by style, color, brand, promotion, price, and seasonality at each store.

The concept of localization works on two levels:

  1. Retailers can look at the unique behaviors of every product – to determine each stores’ selling patterns for size, color, style, quantity, brand, season, etc. With this understanding, a retailer can plan orders on a store-by-store basis to deliver the right amount of the products that customers are buying at each location, allowing the retailer to achieve the highest turn rates, reduce inventory to the appropriate levels, reduce over stocking and stock outs and ultimately increase margin.
  2. The second concept of localization comes from localizing distribution, optimizing routes, re-locating product in the most optimal way, or utilizing vendors that are in a short vicinity of each store.

Size Optimization Overview:

Size Optimization refers to finding the optimal ratio of sizes to carry for given product in a given store. After segmenting products by Size Run (e.g. XS – XL vs. 2-16) and attributes of interest (e.g. Shape, Color, Fabric), the optimal ratio is found by looking at historic demand, which incorporates actual and lost sales. Size profiles for each group of products are computed at the store level, where enough data exists. A number of Quality Assurance steps are applied to the final output to capture and correct for any exceptions. The client can use the size profiles to both impact the size buy pre-season and the store-level allocation in-season.

Pack Optimization Overview:

Pre-Pack Configuration Optimization refers to finding the optimal configurations and sizes for a combination of packs. Optimality is defined in terms of maximizing an objective function that includes handling costs, lost sales, and markdowns (or wastage).  Pack Optimization involves choosing packs such that the increased profit from sales increase and waste reduction more than offsets any increase to handling costs.

Implications of changing pack size:

As the pack size decreases:

  • Handling Costs Increase: we are ordering roughly the same quantity as before, but doing so with more packs. Assuming a given cost per pack (typically 30p), we can compute the increased cost.
  • Sales Increase: greater sales are achieved by allocating more units to a store where the pack size restriction was previously a barrier.

Ultimately, you can arrive at combinations of packs that work well together to meet store/size demand and minimize handling costs without excessive over-allocation of sizes.

Get back in the game

Are you ready this year to know exactly what your customers are asking for at every location and to have the ability to react as their wants change? If you are looking for a solution that can drive momentum for your business this year, check out the solutions offered by Quantum Retail. Our customers see valuable results in 8 to 12 weeks, and our implementation approach gives your team access to the system from the beginning, so you can manage changes to your processes with ease. Quantum Retail continues to help all of its clients drive positive business value more rapidly than anything seen in retail.

For more information, visit: http://quantumretail.com/services/size-pack-optimization

Download this blog as a PDF.

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Quantum helps New Look buck the economic downturn

by Quantum Retail • May 28th, 2009 • Write a comment »

While many UK retailers struggle, one is moving against the downward trend: New Look.

MINNEAPOLIS, 28, May 2009- The third largest womenswear retailer in the UK saw like-for-like sales rise by over 2.8% over the 14 weeks to January 3. Since then New Look has continued to perform well while other retailers are finding the going hard. The fast fashion retailer was aided by Q a new inventory management system that allows retailers to achieve their goals for every product in every store. This intelligent software updates inventory in real time, telling you when one size is selling faster, when a line is not selling and when a certain item is flying off the shelves. It means the customer gets what they want every time.

About Quantum Retail Technology, Inc.

Quantum Retail answers the new questions facing retailers with a merchandise optimization suite designed for the increasing pace and complexity of the consumer revolution and today’s competitive landscape. Quantum Retail’s solutions solve the most difficult and costly problems retailers face – quickly and permanently. Our Q solution is the answer for: Forecasting and Order Planning – Replenishment and Allocation – Assortment and Range Planning.

About New Look

New Look is a store young women visit for the latest interpretations of the season’s fashion trends at low prices. With over 850 outlets across the continent, the chain is one of Europe’s leading clothing retailers. New Look’s annual group sales grew 14.9% from 2008-2009, after implementing Quantum Retail’s Q inventory management solution. Q software optimized their business strategies and helped streamline and expand their fast-moving retail supply chain. 2008-2009 FINANCIAL RESULTS »

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Quantum Retail wins ‘Supply Chain Solution of the Year’ at the Retail Systems Awards, 2008

by Quantum Retail • November 17th, 2008 • Write a comment »

Quantum Retail wins ‘Supply Chain Solution of the Year’ at the Retail Systems Awards, 2008  Quantum Retail is awarded the 2008 Retail Systems Supply Chain Solution of the Year Award for its work with leading EMEA fashion retailer, New Look.

LONDON, UK – November 17 2008. Since 2007, Quantum’s Q solution has been used by New Look to manage its inventory replenishment and allocation processes across its 600 locations. Having increased its retail space by 20% and diversified into online and franchise channels, New Look were seeking a superior replenishment solution to improve management of store/SKU demand and supply.

As well as Q’s ability to help New Look manage and maintain its stock levels and provide visibility across the entire organization, the judges were impressed with Q’s return on investment: going live in under seven months and paying for itself five months later.

Speaking after the award was announced at London’s Grosvenor House, Quantum CEO Tarik Taman said, “In Q we’ve created a next generation inventory fulfillment module that determines inventory need anywhere in the supply network. We’re very proud of what we’ve achieved but most importantly of what our clients have achieved.”

After less than 6 months of operation, New Look was able to realize an increase in full price sales across the estate by 2%, with less stock. At the same time by reducing markdowns, gross margin increased by 4%.

New Look’s Executive Chairman Phil Wrigley commented “Q has enabled New Look to move our supply chain from being buy driven to customer driven, whilst delivering impressive financial results. It is truly first class.”

About Quantum Retail Technology, Inc.

Quantum Retail answers the new questions facing retailers with a merchandise optimization suite designed for the increasing pace and complexity of the consumer revolution and today’s competitive landscape. Quantum Retail’s solutions solve the most difficult and costly problems retailers face – quickly and permanently. Our Q solution is the answer for: Forecasting and Order Planning – Replenishment and Allocation – Assortment and Range Planning.

About New Look

  • New Look has 604 stores in the UK and Eire, and 265 stores in France & Belgium trading under the name Mim. In addition, New Look has 19 New Look branded stores in France and Belgium, and has recently opened 16 franchise stores in Dubai, Kuwait and Saudi Arabia.
  • New Look has a volume share of 5.6% in the Women’s Outer/Sportswear age 16 market, and is the 3rd largest retailer by volume in this market.
  • New Look also has a growing market share in Mens & Kidswear.
  • New Look is now the number 1 retailer of women’s shoes in the UK by volume, with a market share of 7.4%. (Source – TNS).
  • 38% of the British female population has purchased an item of Womenswear** from New Look in the past year (52 w/e 30th March 2008). This amounts to just under 9.2 million individuals. The average age of shoppers in New Look is 31.
  • Further information can be found on http://www.newlook.co.uk and Product and Management photos are available upon request.

**includes Women’s Outer/Sports, Nightwear, Underwear, Hosiery, Footwear & Accessories

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New Look selects Quantum Retail’s Q to optimize inventory fulfillment on path to growth

by Quantum Retail • January 14th, 2008 • Write a comment »

Bolt-on solution set to quickly optimize inventory forecasting and replenishment at top fashion retailer

LONDON, UK - Jan, 2008 – Bolt-on solution set to quickly optimize inventory forecasting and replenishment at top fashion retailer. New Look, a leading European apparel retailer known for its fast fashion proposition and leading designer ranges, has selected and implemented Quantum Retail’s inventory optimization solution, Q, to manage the replenishment of its 600 stores.

“As a fast fashion business with our customers at the core of everything we do, we recognized that Quantum Retail’s demand forecast model offered us an opportunity for our customers to further influence our decision-making,” said New Look Director of IT, Adrian Thompson. “It’s innovative science allowed us to continue to support our fast fashion model with speedy and accurate decisions based on our latest sales and stock figures.”

“The compelling business case that supported this investment was based on a number of metrics ranging from stock imbalance, improved service levels and a reduction in markdown,” Thompson added. “Put simply, Quantum Retail is able to more accurately reflect where our customers would like the product and at what level. It effectively bridges the gap between planning and execution.”

Quantum Retail’s Q solution has been implemented alongside the retailer’s existing Oracle retail merchandising system, initially optimizing the replenishment part of the business. Future planned phases include multi channel lifecycle management, initial allocation and reorder planning. vii.

“The successful delivery of this program was based on an exhaustive proof of concept and a speedy implementation,” Thompson said. “The Quantum team integrated seamlessly with my own. Their well thought through designs included system and integration, great business engagement and training at both commercial and functional levels. Quantum is now live with no adverse impact to either IT or the business and is already giving us confidence that the business case will be delivered successfully.”

After an initial monitoring period, service levels showed an increase in availability alongside a reduction in total inventory when compared to a control group. As the rollout of Q continues, it will be rebalancing stock throughout New Look’s 600 UK and international stores, leading to fewer stock outs and improved sales and profit. Through the use of Q’s advanced forecasting and order planning module, New Look will be able to gain greater visibility of long range inventory need and be able to optimally flow inventory to its stores.

“Q uses a proprietary approach that is designed to be the most accurate, responsive and reliable inventory fulfillment tool in the fast-changing world of retail,” said Chris Allan, head of product strategy for Quantum Retail. “At the same time Q has been designed to be a highly practical and useable solution that operates alongside existing systems for simple and quick implementation.”

“Its simple user interface means Q can be used by our allocators, rather than having to rely on experienced forecasters and mathematicians,” Thompson concluded.

About Quantum Retail Technology, Inc.

Quantum Retail answers the new questions facing retailers with a merchandise optimization suite designed for the increasing pace and complexity of the consumer revolution and today’s competitive landscape. Quantum Retail’s solutions solve the most difficult and costly problems retailers face – quickly and permanently. Our Q solution is the answer for: Forecasting and Order Planning – Replenishment and Allocation – Assortment and Range Planning.

About New Look

New Look has 590 stores in the UK and Eire, and 263 stores in France trading under the name Mim. In addition, New Look has 13 branded stores in France and Belgium, and has recently opened franchise stores in Dubai, Kuwait and Saudi Arabia. In the UK New Look has a 4.8% market share, making it among the leading womenswear retailers in the UK (Source – TNS).

New Look also has a growing market share in Mens & Kidswear and is now the number 1 retailer of women’s shoes in the UK by volume, with a market share of 7.3%. (Source – TNS). 25% of British women have bought an item of outerwear from New Look – amounting to over 6 million customers (Source – TNS). New Look’s competitors include H&M, Next, Top Shop and Dorothy Perkins. The average age of shoppers in New Look is 30.

Further information can be found on http://www.newlook.co.uk and Product and Management photos are available upon request.

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