Guess shifted to digital merchandising in the middle of COVID-19.
Guess Inc. took the risk of investing in digital merchandising technology as it was shutting down stores due to COVID-19.
The global vertical fashion retailer had been planning to replace Excel spreadsheets for buying and merchandising with an end-to-end digital solution. Guess needs to manage an 8,000-SKU assortment, with four collections released per year.
Then, the COVID-19 pandemic hit in 2020, temporarily halting the company’s capital spending. Determining that its need for a modern planning tool was even more urgent under the circumstances, Guess decided to revive its capital spending to begin implementation of the Centric planning solution during the first global COVID-19 lockdown.
Having 25 product categories in over 100 countries with roughly 1,000 directly-operated stores worldwide and 1600 stores in total, Guess operates an omnichannel business model. The company sells its products via multiple touchpoints such as e-commerce, retail and wholesale.
At the time, Guess was using Excel sheets to conduct buying and merchandising tasks. The company had to divide up its teams and files by category of product because it couldn’t manage all the SKUs in one place. As a result, Guess operated planning with several Excel sheets, which were not connected or synchronized, with employees working on only a part of the whole. Management and key business executives needed a high-level overview of planning activities, but couldn’t get it with the existing process.
Guess needed a single, unified planning tool to have everything in one place and enable it to deal with different currencies, customer tastes, and trends by country. In response, Guess devised a new business model based on a four-pronged approach: product cost, brand elevation, occupancy, and operational efficiency.
To achieve those goals, Guess aimed to respond more quickly to marketplace disruptions, move premium product lines onshore, reduce overstock and discounting based on fluidly managing inventory, and increase margins.
By implementing Centric planning technology, Guess has been able to execute its new business model via manual workload reduction. The company has decreased its planning time, down from a month to one week.
Other benefits Guess obtains from its new planning solution include more easily updating range or assortment planning all the way up the merchandise plan, and having local country managers work directly within the solution to select their preferred collections. In addition, production costs have improved because Guess has been able to consolidate product development for all regions into one single line.
Lands’ End optimizes product assortment
Lands' End is also implementing Centric technology in an effort to improve its end-to-end business processes across the enterprise by eliminating the manual re-entry of data into disparate systems. The apparel brand is deploying the Centric Software product lifecycle management (PLM) platform, with the goals of achieving seamless integration between PLM and connecting systems, automated and consistent data flows, standardized cross-team processes, clear communication, and fully enabled process and system functionality across business models.
“Before COVID, we had a 5.6% operating margin at the end of fiscal year 2020,” said Daniel Botey, VP of global inventory management at Guess Europe Sagl. “We closed this past year at 12%. It is a huge improvement in profits. If we had had a lot of inventory, we could not have done it. Centric planning has been an enabler to truly follow our strategy and increase our profitability in a very, very big way.”