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Top 5 Reasons why a fashion company on SAP AFS and IS-Retail should consider SAP Fashion Management Solution

Thu, Aug 28, 2014



Fashion brands and retailers are being pushed to innovate and become more demand responsive and customer-centric as they seek to compete in a marketplace where technology is enabling exponential improvements to supply chain and inventory management on the one hand, and driving the increasing sophistication of consumer expectations on the other.

In order to help fashion retailers to better navigate this complex environment, SAP has developed the Fashion Management Solution (SAP FMS). Launched in June 2014, SAP FMS is already being adopted by leading brands such as Tommy Hilfiger and Rockport but what is it that SAP Fashion Management bring to the table for a company that is already using SAP AFS or IS Retail platforms?

1.Global Inventory Visibility

According to a recent L2 report, inventory transparency is the single biggest thing retailers can offer online to drive foot traffic. Optimal management of inventory to ensure that the right stock is available at the right place at the right time is arguably one of the most crucial objectives fashion companies must achieve in the omni-channel.

However, operation of separate systems for retail, wholesale and manufacturing tends to restrict combined inventory visibility. In response, brands generally take the conservative approach by adopting processes which protect inventory but potentially result in supply imbalances such as high out-of-stocks in one channel and excess inventory in another.

SAP HANA redefines processes related to inventory management by optimizing allocation run (ARUN) and available-to-promise re-scheduling (ATP). Such processes are crucial for brands seeking to gain an accurate representation of global inventory levels. However, they had previously been hindered by the massive volumes of data involved. The resulting burden from these data volumes limited simulations to an overnight process.

Fashion brands that leverage the power of SAP FMS on the SAP HANA platform can drastically optimize ARUN and ATP processes, enabling frequent daily simulations. In doing so, SAP FMS will empower brands with an up-to-date, consolidated global view of inventory across all stages of the value chain..


2. Cross-Channel integration enables consistent, omni-channel shopping experiences

Implementation of omni-channel solutions will be of crucial importance for brands seeking to meet or exceed customer expectations. With retailers like Burberry leading the way by offering a consistent experience to consumers across sales channels, retailers are well past the point of debating the need for going omni-channel.

By moving to SAP FMS, retailers will gain the tools necessary to re-align their supply chains to this new omni-channel reality, thereby enabling the extension of brick-and-mortar retail into the online world and vice-versa. The end-result being a more responsive value chain and ultimately and most importantly, more satisfied customers.

For more information on this, check out our white paper on How SAP Fashion Management Can Help Transform Fashion Businesses on SAP AFS and IS-Retail.


3. Personalized offers, promotions and loyalty programmes

While most fashion retailers use general promotions and basic loyalty programmes to augment sales, they lacked the ability to personalize offers to suit the individual preferences of consumers.

However, given the advanced analytics capabilities of SAP Customer Activity Repository (SAP CAR) on SAP HANA, retailers can now engage customers by tailoring their offers based an individual customer’s purchase history. SAP CAR is designed to consolidate customer, sales and inventory data in real-time for comprehensive and more accurate analyses. 

Brands and retailers that leverage these targeted marketing strategies stand to benefit from improved sales while earning customer loyalty and adding to their overall brand equity.


4. Integrating platforms for a lower TCO

Operating separate systems for retail, wholesale and manufacturing can lead to an increased total cost of ownership. This is due to separate integration, development and maintenance costs for each unit.

By adopting SAP FMS, brands and retailers will bring all of these processes and data onto a single platform, thereby eliminating the need to duplicate and integrate data. This cuts through the complexity of managing data across multiple systems; the end-result being a reduction in the TCO and an improved bottom-line.

SAP HANA will redefine processes related to inventory management by optimizing allocation (ARUN) and available-to-promise re-scheduling (ATP). Such processes are crucial for brands seeking to gain an accurate representation of global inventory levels. However, they had previously been hindered by the massive volumes of data involved. The resulting burden from these data volumes limited simulations to an overnight process.

Fashion retailers that leverage the power of FMS on the SAP HANA platform can drastically optimize ARUN and ATP processes enabling frequent daily simulations. In doing so, FMS will empower brands with an up-to-date, consolidated global view of inventory across all stages of the value chain.

Connect with our experts on LinkedIn to stay updated on the latest SAP Fashion Management related news.

5. Deeper Consumer Insights leveraging big data and social media analytics

In the age of the digital consumer, the potential for fashion and lifestyle companies to gather and analyze big data is on the rise. Big data initiatives will drive a real-time understanding of the consumer and provide fashion retailers with an unprecedented level of insight into consumer behavior and preferences.

Integration of social and other sentiment data into intelligent analytical models will shift capabilities from reporting the past to predicting the future. Additionally, this will improve insights into which trends are gaining momentum and which ones are losing ground at any point in the product lifecycle.

FMS is built on the existing SAP for Retail platform, but comes with the in-built SAP HANA. This powerful in-memory database that can analyze big data from multiple sources to get answers to complex questions about their business in real-time - without the need for data preparation.

Brands equipped with these insights can make smart adjustments to designs, production and marketing before launching a new collection, reducing the risk that the line won’t sell. 

Migrating from AFS and IS-Retail to Fashion Management Solution SAP