5 Reasons Why Fashion Retailers Need Merchandise Planning Software
When I started as Head of Data and Intelligence at THE ICONIC, Australia's largest online fashion retailer, I was placed on the executive team. This was my first formal executive role, and I wanted to ensure I had the highest impact on the entire company that I could.
I scheduled meetings with the other executives and asked them "What are the biggest challenges you face in your department?". Each executive then went on to describe problems with communication between departments caused by siloed activities, and the lack of technology support they had. Almost all of their operational issues could be solved with software.
I went on to stabilise reporting, then migrated from our Oracle RDMS to Amazon Redshift, gaining huge cost savings and performance improvements. I sped up the time to get changes to reports from the various departments, then I assembled a team and we built a data platform and released self-service reporting to the entire business. Whilst that was in progress I took over the ERP, fired our terrible contractor and hired an in-house person who was amazing, and improved our operations.
By this point I'd developed enough credibility with the executive team, including our CEO, to be able to recommend a significant change to the way the company operated. Up until that point, 100% of engineering resources were dedicated to the mobile and web apps, and we had over 100 software engineers! Each department, including Category Management (merchandise planning and buying), Finance, Fulfilment Centre Operations, Marketing, Production, Support... none of them had any dedicated engineers. I proposed that we build internal automation teams that included engineers that could build software improvements to each of these teams.
The biggest cost for a fashion retailer is inventory: they need to buy the product that they predict their customers will want. The Category Management team contained about 120 staff who consist of Merchandise Planners who plan the budget for each category (mens shoes, womens dresses etc.), the range of products to buy, and then Buyers who liaise with the vendors (Bec & Bridge, Spell, Nike etc.) to actually buy the specific products in the right volumes.
This team lacked any software to perform these tasks. How the hell did they do it? The answer: poorly. They depended entirely on Excel spreadsheets, which they spent ~60% of their time working on, and then emailing performance data and inventory volumes (email is unencrypted so anyone could have been intercepting this sales performance data!). ARGH! I can't even talk about how much time and money was being wasted and lost. Here are the 5 reasons why fashion retailers need a software solution to their woes:
- Increased profitability through improved decision making about the product range
- Decreased time spent on manual work
- Improved relationships with vendors
- Increased responsiveness to customer demand
- Improved security