The benefits and drawbacks of adopting a planning system.
Merchandisers from across the retail industry gathered at a Drapers roundtable at the Haymarket Hotel in London on 6 October to discuss the benefits of using software planning systems to maximise future growth and how to get their businesses to invest in such tools.
Huge investments are being made on new systems and technology across fashion businesses, yet many merchandisers are still recording and logging stock on Excel spreadsheets.
Drapers, in association with merchandising software specialists Island Pacific, joined together merchandisers from retailers including Karen Millen, F&F, Jigsaw, Dune and Gant to discuss the benefits a retailer can gain from a software planning system and what the barriers to adoption could be.
Most guests around the table have yet to invest in such a system and are on a fact-finding mission, but those that have already converted are keen to espouse the benefits.
René Blankestijn, planning manager at Dutch fast-fashion retailer Coolcat, is eager to bring new software into his business: “I think Excel is hard to maintain. It’s error-prone and doesn’t help you in any way with forecasting.”
Keeping data safe
Data integrity in Excel was one of the biggest concerns of the retailers in the room, particularly when spreadsheets are shared and used by many teams. Columbus Consulting’s Charlotte Kula-Przezwanski says errors can often be introduced and points out the research commissioned by Island Pacific, undertaken by her consultancy, which found data integrity issues can reduce retail turnover by as much as 14%.
Dune Group merchandising director Nilesh Karia says introducing an Island Pacific system into his business has enabled his team of merchandisers to “make better, more informed decisions”.
You can absorb the information and act on it, rather than spending your time inputting it
Judith McCandless, senior account executive, Island Pacific
This is not only the result of more accurate data. Moving planning on to a system also takes away the time-consuming job of data input and allows planners to spend more time deliberating their decisions.
Judith McCandless, senior account executive at Island Pacific says: “You can absorb the information and act on it rather than spending your time inputting it.”
Lucy Peacock, head of merchandising at Tesco’s clothing brand F&F, says this is one of main reasons she is exploring investing in a system: “My merchandisers are spending of lot of their time trying to work out why the data that goes in is not right. [The correct software] would give us more time to make the right decision for our customers. As we manage costs and stock more tightly, we need that.”
Barriers to adoption
The benefits of adopting a software planning system seem clear, so what is preventing some retailers and brands from investing? McCandless says that despite an appetite from merchandisers, getting buy-in at board level is a challenge.
“Technology is evolving so fast at the moment and there are other things that are seen as more important that the business requires,” she explains, adding that operational systems, such as ecommerce, are viewed as a higher investment priority.
Offering a perspective from another industry, Susanna Kenniston, merchandising director at The Perfume Shop, says the fact that planning teams tend to “muddle along” means investment in their function falls down the pecking order: “You need to turn it into financials to get buy-in.”
However, Karia points out that, for a planning system, calculating return on investment is difficult.
Kula-Przezwanski goes back to the statistic that data integrity can hit turnover by up to 14% and explains that point could help build a compelling business case.
“Even if it’s only 1% or 2% in your business, that can fund a planning project,” she says. Nonetheless, some around the table express concerns over whether a software planning system would stand the test of time.
The key is to future-proof the systems
Nilesh Karia, merchandising director, Dune Group
“Retail is changing so much and so quickly. The key is to future-proof the systems,” says Karia.
However, Lucy Maitland Walker, merchandise director at Coolcat, says working with the right vendor can help ensure your system has longevity: “You’re looking for a partner that can move as quickly as the market. I’d be expecting vendors to be pushing and understanding what new technology is.”
No silver bullet
Software can clearly help make planning quicker and more accurate, but attendees who have implemented it in their businesses warn it is not a cure-all.
McCandless says retailers must make sure the information that is fed into the system is accurate: “You need to look at what has to to be fixed in other parts of your business before it hits the planning systems.”
There’s no point in having it if you’re not going to do anything with the result.
Janet Finney, merchandising manger, Karen Millen
Karen Millen merchandising manager Janet Finney says it is not just what goes into the system that needs focus – businesses must be prepared to act on what comes out of it: “There’s no point in having it if you’re not going to do anything with the result. It would be a huge change for our business, but a good change,” she says.
There is also a danger that merchandisers could lose some core skills by relying on a planning system, says Kenniston: “There’s a risk that they lose that gut feel. You press a button and that’s the answer.”
Karia says Dune Group makes sure that staff is trained on Excel and how to analyse weekly sales, stock and intake, before they start using the system to ensure this does not happen.
However, Kula-Przezwanski points out that it is a merchandiser’s trading ability rather than Excel wizardry that is the most important skill to cultivate: “Rather than bring in people who are super-whizzy at Excel, I can now bring in people I can train to be traders.”
Introducing any new software to a business involves a lot of change and there will be challenges in terms of adoption.
Kula-Przezwanski advises those planning such a project to start by keeping the system simple: “There’s a tendency for people to build a monster, something that will solve all your problems. But when you give it to assistant merchandisers they think, ‘I don’t want to use that. It’s rocket science’.
“Keep it simple and get it in place in six months. Adoption will be quicker.”
Kenniston, who uses Island Pacific’s system at The Perfume Shop, agrees and says starting simple can allow flexibility and enable users to request changes and tweaks as they begin to understand what they want from it.
There can also be some resistance to change from merchandisers who are wedded to Excel. Karia says some people continued to work with Excel in the background when Dune Group introduced its system. The footwear retailer implemented the system by picking a group of people from across the organisation, across all levels and functions, who trialled it and became advocates.
McCandless recommends having “super-users” who walk the floor in head office in the early stages of implementation. She says these people are at hand to answer any questions or concerns about the system as they arise.
Kula-Przezwanski says some retailers opt to lead from the top. She uses the example of one retail chief executive who frequently approached members of the merchandising team and asked to be taken through the process.
“He wanted to make sure people were using it and his investment wasn’t wasted,” she says.
There may be challenges to investment and implementation of planning systems, but retailers such as Dune Group and The Perfume Shop prove they are not insurmountable. The potential to make better decisions for customers and, in turn, to aid in the future planning of your business are compelling reasons to tackle on those challenges head on.
HOST: Christina Simone, deputy editor, Drapers
René Blankestijn, planning manager, Coolcat
John Cossey, head of merchandising, Jigsaw
Janet Finney, merchandising manager, Karen Millen
Ruth Hamilton-Cox, head of buying and merchandise, Gant
Nilesh Karia, group merchandising director, The Dune Group
Susanna Kenniston, merchandising director, The Perfume Shop
Charlotte Kula-Przezwanski, consultant, Columbus Consulting
Lucy Peacock, head of merchandising, F&F
Lucy Maitland Walker, merchandise director, Coolcat
Judith McCandless, senior account executive, Island Pacific
Emma Mulgrove, head of merchandising, Karen Millen
Nicola Ridgeway, marketing and customer relationship manager, Island Pacific