Fashion retail chain O’Neill Europe has undergone a major IT consolidation to cut costs and use information more efficiently in a difficult trading market.
The company works with 34 distributors in Europe, each previously with its own warehouse and ERP systems. As such, O’Neill was struggling to keep stock at optimum levels, which was affecting profitability. The company made significant savings by consolidating its supply chain under a single electronic data interchange (EDI) platform.
It reduced the 50 different enterprise resource planning (ERP) and customer relationship management (CRM) systems down to five by rolling out a single ERP system under Lawson M3 and Liaison Technologies’ Electronic Commerce Server (ECS) – a tool to help consolidate the range of applications – which was completed at the end of last year. The ERP roll-out cost around €6m to implement.
This has enabled the company to view all regional sales data in a single location. Richard Van der Hoek, integrations manager for O’Neill Europe, said the company is now able to respond to trends in the market more quickly.
Read more about technology in retail
“The big benefit is centralised data, so we are now able to inform countries quickly about cancelled colours, etc. The other benefit is all sales orders are also in one system, so we no longer depend on countries individually delivering the information, as we can see trends and styles before forecasting stock,” he said.
Van der Hoek said the systems consolidation has enabled O'Neill to strategically target the markets served by its 33 European shops.
He said in the current economic climate the number of stores was likely to decrease, while its outlets selling discounted items would grow. “In the European economic environment, I think that [number of stores] will drop,” he said. “The online channel is also dropping. We expanded to a lot of countries last year, but people are now looking more to price than products.
“We are opening three outlet stores in Europe. That is a trend going forward, and having accurate information about stock levels is important in making [those strategic] decisions.”