“I don’t think this is actually about technology. I think this is about business results. I think what retailers need to look for is a partner that can understand their problems, understand their business, and can demonstrably show that they can help deliver the project that they need, deliver their business plan, and help them with their long-term strategy. Although we have the best technology, it’s really only a tool to get you the results, and that’s what Quantum is all about.”
LISTEN TO PART 2:
speaking with Wyndham Albery, VP Customer Strategy, Quantum Retail • June 2011
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Audio Transcript
Thanks to our audience for joining us today. I am Dan Brown, from Mulberry Marketing in San Francisco, and I am joined with Wyndham Albery, VP of Customer Strategy at Quantum Retail in the UK.
Thanks for having me Dan.
Well at the moment, the real focus is on improving business performance. The key thing that retailers have at the moment on their agenda is to improve their top-line sales, make sure they can minimize their waste or markdowns, and really manage this profitably because obviously for any retailer, profit is the most important thing they have. So for our customers, it’s really doing all of those things at the same time while supporting their strategic customer offer.
Do retailers need to change their way of thinking to really solve these problems?
Well the old and traditional ways of running retail systems pretty much peaked in the late twentieth Century. So today, those solutions do not really support the complex world and the fast-moving pace of retail. You know today, compared to 20 years ago, you need multichannel, you need to be able to be multi-format, you need to be able to manage a huge number of SKUs and their rapid entry and exit. So, yeah, the world has really changed, not to mention the fact that there is a far more sophisticated consumer out there who is much more aware of the retail tricks, what’s going on, finding what they want. So, I think it’s important for people to understand that they do need new technology. Because the current stuff that’s out there with traditional systems is a bit like using a fax machine today. Yes it works, but it doesn’t really do what you need to do in today’s competitive world.
Why do retailers choose Q over the more traditional solutions?
Well I think it’s pretty simple. It’s really because the Quantum focus is about delivering results. And our customers appreciate that. You know, our goals are really to deliver their business case and measure how we’re doing against it, which they appreciate. Also, we are working to their time frames, which these days in retail is very fast. People need to get projects in and working and delivering results quickly. But of course, that doesn’t make any sense if there isn’t an ROI. And our ROI is pretty quick, you know, usually within the year. So, you know I think that’s why we’re being chosen. Essentially our projects have a fast payback, help our clients change, and move their business forwards. We are not just another IT project. Our customers see us really as someone who can bring in change and get them the payback that they are looking for for their investment.
Ooh good question Dan. Our clients have a customer offer that they need to be able to fulfill. That promise is very important to them. And that promise comes in the form of having a great product, but also making sure that it is available for purchase. However, that doesn’t mean they can just bloat their supply chain with inventory. Or that they can have loads of markdown or waste at the end of the season or at the end of the day. So this balance is really very delicate but very important because it needs to be done these days at the store level. It needs to be done profitably, and really people have to remember that retailers aren’t charities. And nor are they trying to basically fill outlet malls, much to my wife’s desire, she would love it if they were full of interesting products to buy; I personally am trying to get rid of that problem. So you know, in this hard and complex market with very difficult economics, huge constraints on retailers, we are able to help them reduce their inventory, improve their availability to the customer, and really help them keep their customer offer and promise, and help them get to the profitability target they are looking for.
Well I actually was talking to one of my clients about that the other day, and the feedback that I got was that their suppliers really appreciated getting forecasted orders that they can actually use. Use to plan, use to smooth their production and reduce the lead times in the supply chain–all of this is incredibly important for them. And when I asked them how ours compared, they said that ours was some of the most accurate that they had ever seen. So yes, it is very, very important for our clients to be able to provide their vendors and their suppliers with accurate forecasts.
That’s excellent. So how are Quantum projects different than those of traditional vendors?
Well we, like most things, have taken a different approach. You know, our projects aren’t just about wiring and a bit of software, our projects are quite different. They are really about bringing change to a retailer and more important than that change even is delivering the results, or the business benefit that the people are looking for. So although we are putting in software in our solution. It is really about measuring where they are today, understanding the business performance they are looking to get, helping them set up the system to do that and their processes and their goals and their targets, and really, turning on the software is probably the easy bit, what becomes interesting is getting them to achieve the change and the results that they are looking for. And we have a very structured methodology of test and control to measure our system against how the current system is doing, and making sure we are moving the whole business forward to achieve their business goals. So yes, for us it isn’t just about a project plan, this is really about a change plan for how they run their entire retail business.
You mentioned business benefit. Can you go into that in a little more detail?
Yeah well it’s a very important part to Quantum, and really our product is all about measuring the value we bring. So with the test and control we understand where their business is now, with the system we are able to set what they want to achieve, and really what we’ve done, for example with New Look, was improve their gross margin by about 4%, and that was through a combination of increasing their full price sales, and decreasing the amount of markdowns they had to take. And that was all about making sure the inventory was in the right place.
Marks & Spencer for example, we are rolling out Q to all of their categories, and again what we have seen is a better availability to capture the full price sales of their product, and minimize the amount of waste that they have to incur, because their product has a very limited shelf life–often as low as between a day and two days–so for them it’s paramount to have that stock where they are going to sell it, otherwise the waste becomes a huge burden on their business. So yes, this is what Quantum is really bringing to our clients, is that change in business performance.
Great question Dan. Yeah, it’s important to us, very important to us. Because we spend a lot of time with our clients, understanding their problems. And like I said before, it’s all about getting the results that they are looking for. So we haven’t just been wiring in a piece of software, we’ve really been getting under the skin of their problems, what makes them tick, and what they are trying to do. So invariably we find is that we have a very long relationship with our clients, because there is always something else that they want to do, something else that they want us to improve. So we have some great technology and ways of looking at it. So invariably they ask us to either help refine something, or think about something new, so I’ve found that all of my client relationships go on and on, really, and it’s a great relationship that we have because it’s very mutually beneficial. In terms of, our product road map is driven by our customers, we don’t make it up, they tell us what they think is important. And that I think is a great testament to the relationship that we have with our customers.
Very interesting question Dan, and I hope maybe I have a point of view on this, and I’m not sure it’s the one that you’re expecting. I don’t think this is actually about technology. I think this is about business results. I think what retailers need to look for is a partner that can understand their problems, understand their business, and can demonstrably show that they can help deliver the project that they need, deliver their business plan, and help them with their long-term strategy. Although we have the best technology, it’s really only a tool to get you the results, and that’s what Quantum is all about. And really, I think if you want sexy technology, go to an Apple Store.
Ha ha. True, true. Well thank you very much for joining us Wyndham.
Well I really appreciate you asking me, Dan. And I look forward to seeing you again soon.
And thanks to our audience for listening. Join us next week, when we will be speaking with Caroline Ragouzaridis, Director of Customer Strategy at Quantum Retail.
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.
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.
