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Case Study: Small Retail Chain Gears Up for Rapid Growth

Written By: Christina Park
Published On: October 17 2007

The Client: Elephant Pharm, a start-up chain in the natural health and wellness retail sector.

The Major Challenge: To find a retail solution that would grow with the company and help it develop into a multinational chain.

The Operational Issues: A lack of enterprise-wide inventory visibility, the need to run the business at both a centralized and decentralized level, and the need for a sales reporting function at a more granular level.

The Solution: A retail software package from Aldata Solution.

Download this podcast to find out how Elephant Pharm, a four-store start-up retail chain, found the retail software it needed to achieve sustainable growth while allowing it to immediately compete with the bigger players in the natural health and wellness retail market.

In this podcast, Christina Park, senior retail analyst at Technology Evaluation Centers (TEC), sits down with Tim Millen, vice president of information technology (IT) at Elephant Pharm. Tim brings over 20 years of retail IT experience to the conversation, and describes both the challenges facing Elephant Pharm and how the company found the right software solution for its needs.

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Podcast Transcript

Welcome to TEC Radio. I'm Christina Park, senior research analyst for Technology Evaluation Centers, and I'll be your host for today's show. In this episode, we will be discussing a customer case study in the retail industry. We will be speaking with Elephant Pharm's Tim Millen. Tim is the vice president [VP] of IT for Elephant Pharm, a four-store start-up in the natural health and wellness market. Today we will be exploring some of the business issues and pain points Elephant Pharm was experiencing, and the process Elephant Pharm took to explore the retail technology solutions available to them to answer those problems, and ultimately how Elephant Pharm arrived at Aldata Solution to solve those issues for them. Tim Millen has 20 years of IT experience. Prior to joining Elephant Pharm as VP of IT, he was the vice president of information services and technology for five years at Bebe Stores, the worldwide fashion retailer. Other positions held over the last 18 years have been VP of information systems for BCBG, and the head of product development for Contempo Casuals.

Christina Park: Tim, thank you for taking the time today to speak to Technology Evaluation Centers. I'd like to start off by talking about what prompted your organization to make an assessment and subsequent investment in implementing retail software solutions. If you could just tell me some of the corporate challenges that you were seeking to resolve.

Tim Millen: Sure. We were in kind of a have-to-do mode. The software that we had installed at our first store was not going to carry us forward to a multi-store company. So what we did was we went and looked for a solution that would 1) be able to grow with us, but 2) also be able to grow with us for a long period of time into a multinational chain.

CP: What would you say were the specific business issues that posed the greatest challenge in finding the right solution for you in order to scale for that growth that you're anticipating?

TM: Absolutely it would fall within the visibility to our inventory and to our sales reporting. With Aldata, we're actually able to run our business from a centralized and decentralized environment. So in the centralized [environment], we have our merchants who are placing orders and managing inventory and ordering product into the store. Our stores actually order product themselves to be drop-shipped to their store, and then we also have products that go to our warehouse and are distributed to the store.

Aldata has been able to manage all of that for us, where previously we were not able to. The second point is sales reporting and the ability to look at our business at a smaller increment. Our older system would only track at a high-level, aggregate total, and it became very hard for us to manage on particular trends and certain activities that might be happening in each store as individuals. And with Aldata, we're actually able to see that at whatever level we want to dig into.

CP: Well, as you've mentioned, the perceived challenges of implementing a new solution must have seemed daunting to various levels within your organization, including what you've already talked about: the lack of enterprise-wide visibility, the system complexity, potential costly implementation and costly support, and even disparate integration requirements, because of the number of stores that you have, of multiple point solutions. So given those challenges, what factors were considered when evaluating the universe of vendors, and how did you ultimately arrive at the right solution?

TM: This actually was a very guided process. I had been following Aldata since they first arrived in the US—I think at their first trade show—and had a chance to actually see their system at that point. And then, even though at that time I was working for a different company, I was always impressed with the way they had structured their software and the database that was behind it. So as I started looking deeper into it, and through the years, I got to see how their product grew and how they were addressing the US market. So then when it came time for us, for a small company—we currently have four stores—for us to take on a system as large as Aldata was kind of a big worry of mine.

We were trying to compete with the big guys and have the higher level of system control that the big guys have, but still do it with our small store chain, as well as the small amount of staff we have to run the system. When evaluating Aldata, we were actually able to segment that out and understand exactly what would be needed to run our business on Aldata, and it actually ended up being a really good fit.

The second half of that was the implementation. Some of these implementations can take years and millions of dollars, and we were very concerned about not getting into that mode because of the fact that we just couldn't afford that. So with Aldata, they had come to us with a rapid implementation, where it scoped, start to finish, a six-month process. And that actually worked very, very well. And rarely does this happen—and rarely in my career has it happened—where you finish early. So we finished two weeks earlier than our scheduled implementation plan.

CP: So the implementation was not only on budget, but also on time—even, in fact, in advance of schedule.

TM: We had a situation where our fourth store got pushed out [at] the exact same time we were going to go live, and in order to manage that, we actually ended up speeding up the Aldata implementation sooner, so that the fourth store would actually go live with Aldata in it. And it worked, and we actually beat the schedule.

CP: Ultimately it sounds like the implementation was quite a success. In terms of the other issues that you were wanting to address—in terms of those challenges that we talked about earlier—would you say that Aldata was able to address all of those issues? And if so, was it really directly as a result of their retail software solution?

TM: Yes, absolutely. The discovery portion of their project implementation really went through our business and defined exactly how we were going to use their software, and what we would be getting from their software. So the expectations were set really early, and we are small enough now, then still flexible, that we were able to change some of our operational procedures to match their software. So it was kind of a good meeting in the middle, which then got us a better impact of the software because it was a better fit by the time we finished the project.

CP: Perfect. So it sounds like Elephant Pharm is a satisfied customer of Aldata, and it sounds like they were able to address all the issues that you were hoping to address in terms of when you wanted to implement a retail software solution. It sounds like it was a great customer success story.

TM: Yes, absolutely. We were very happy.

CP: This concludes this episode of TEC Radio. For further information on Aldata's retail solutions, please visit http://www.aldata-solutions.com.

For more information and to start your own custom solution comparison, please visit

TEC's Merchandising Evaluation Center.

 

 
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