Product Note: NGC's Fashion PLM and Sourcing Solutions

  • Written By: Yu Chen
  • Published On: January 8 2010



New Generation Computing, Inc. (NGC) has a long history of serving the fashion industry. After adding Web-based product lifecycle management (PLM) and sourcing and production systems (e-PLM and e-SPS, respectively), to the product portfolio, the company became closer to being a one-stop-shop for its target customers. Seeing the increase in PLM adoption in the fashion industry and NGC's recent achievements in the fashion PLM area, I decided to create a product note for e-PLM and e-SPS that might help business users select fashion PLM and sourcing solutions.

Product Background

NGC has developed and marketed software for the fashion industry since 1982. The company provides global sourcing visibility, PLM, enterprise resource planning (ERP), and shop floor control systems to brands, importers, and retailers. NGC is headquartered in Miami, Florida (US), with offices in New York, New York (US); Los Angeles, California (US); China; India; Mexico; and El Salvador.

As a wholly owned subsidiary of American Software Inc. (NASDAQ: AMSWA), NGC does not report its earnings separately. However, in a press release dated September 2, 2009, American Software reported preliminary Q1 2010 results showing that the company achieved its 34th consecutive quarter of profitability, and that license fee revenues increased by 51 percent and adjusted net earnings increased by 155 percent. American Software also remains debt-free.

NGC's e-PLM is a Web-based solution providing line planning, style spec development, costing, and Consumer Product Safety Improvement Act (CPSIA) compliance for retailers, brands, and importers in the apparel, sewn products, and furniture industries. It integrates with e-SPS, its Web-based companion, for purchase order (PO) distribution, work-in-process (WIP) tracking, quality control, and inbound logistics. NGC's e-PLM and e-SPS provide such benefits as

  • enhanced collaboration and creativity throughout the entire organization;

  • faster definition of product concepts and costs;

  • tracking and management of critical timelines throughout the organizations and across the global supply chain;

  • reduced product development cycle time; and

  • reduced costs and improved profit margins.

NGC's e-PLM and e-SPS have over 150 active customers globally. The number of users per installation varies considerably, ranging from just a few to several thousand.

Due to the proximity between product development and sourcing activities in the fashion industry, many of today's fashion PLM solutions (or in other words, PLM solutions for apparel, footwear, and accessories) either are provided with sourcing capabilities together in the same package or have the capability to integrate with external sourcing modules. Hence, it makes sense that we consider NGC's e-PLM and e-SPS as a suite for fashion PLM (including sourcing) in this note.

On the current basis, some likely competitors of NGC's e-PLM and e-SPS include Dassault Systèmes ENOVIA with Accelerators for the fashion industry, PTC FlexPLM, and TradeStone Merchandise Lifecycle Management.

Product Strategy and Trajectory

NGC is maintaining its focus on the fashion industry. Several years before the company introduced its PLM solutions in 2000, it had already established an ERP system specifically for the fashion industry. The introduction of e-PLM and e-SPS made the company more capable as a one-stop-shop for apparel brands, distributors, and retailers when they need enterprise software solutions. Besides the industry specialization, NGC also shows its positioning strategy in the following ways:

  • NGC target customers are brands, retailers, and importers of consumer products. NGC customers range from very large companies to small and medium-sized ones. The list of some of NGC's current customers may give readers a better idea of the customers the company is aiming at.

  • The main customer base is located in North America, although the company also has global reach. Currently, the solutions have been implemented in English and Spanish.

  • NGC is regarded as a leader in its area and performs ongoing innovations. For example, NGC was one of the earliest vendors to introduce Web-based global sourcing software, an integrated PLM and global sourcing system, and software for managing compliance with the CPSIA.

Other than its geographical coverage—and I expect to see further expansion in the near future—I think NGC's positioning strategy will likely remain the same over the next three to five years.

Product Strengths

The products' strengths are firstly located in the history and expertise that NGC has built upon. As a long-time and focused software vendor, NGC has accumulated abundant experience developing and implementing software systems for its target industries, both domestically and offshore. The in-depth knowledge of NGC's professional staff may significantly contribute to NGC customers' achieving high return on investment (ROI), rapid implementation, and a relatively low price for specific configuration based on customers' business needs. NGC says its "management is deeply involved in many industry organizations, and [the company] has a recognized leadership role in developing new solutions."

If we look at the solutions from a more functional and technical point of view, the following are some highlights of e-PLM and e-SPS:

  • Functionality coverage: e-PLM and e-SPS together make one of the most comprehensive fashion PLM suites we TEC analysts have ever seen. Based on the fashion PLM requests for information (RFIs) (a document TEC uses to collect solutions' functional capabilities and technology features in very fine granularity) we have received from various fashion PLM vendors, NGC's solutions score well above the average.

  • Solution architecture: Some fundamental functionalities (such as workflow and event management, collaboration, and exception management) are structured in such a way that e-PLM, e-SPS, and even NGC's other solutions can share them across the organization. This approach allows better data and process consistency.

  • Integration capability: First of all, e-PLM and e-SPS are fully integrated. From the functionality perspective, a user can treat e-SPS as the relaying party for e-PLM. The integration provides users with streamlined connectivity between product development and sourcing activities. Second, NGC's e-PLM and e-SPS also provide a strong integration capability with other enterprise systems, whether they are NGC products or not.

  • Unique functionality: Within the fashion PLM industry, NGC is one of the earliest vendors to offer CPSIA and 10+2 compliance capabilities. For US fashion distributors and retailers, these capabilities are essential, considering fashion companies in the US now rely heavily on outsourced production.

Product Challenges

Although the fashion PLM industry is becoming more established, applying PLM in the fashion industry remains quite challenging to all fashion PLM vendors and users, since fashion is very different from other industries (e.g., aerospace, automotive, and industrial equipment) that have a much longer history of adopting PLM methodology and systems (see A Two-layer Model for Fashion PLM Functionality for more information about the specificities of fashion PLM systems). And although recognized as one of the leaders in the fashion PLM market (see Gartner's MarketScope for PLM in Apparel, Footwear and Accessories [registration required]), NGC will still need to continue exploring how to bring more PLM benefits to this specific user sector.

As NGC's SQL Series software, e-PLM and e-SPS are developed in the Microsoft environment (.NET as the platform and SQL Server as the database). This technical feature can be either a strength or a weakness, depending on the IT strategy and preference on the user side.

Vendor Recommendations

Starting as an ERP vendor specifically for the fashion industry, NGC was able to quickly understand the fundamental requirements for successfully developing fashion products, and provide the required software functionality in consequence. The next step is to go to finer granularity in product design and development processes. Based on our research about NGC, I would recommend NGC develop more functionality in areas such as material development management and bill of materials (BOM).

I think possibilities exist for NGC to reach more customers on the smaller end of the company's target market range. In my opinion, one way would be for NGC to add a software-as-a-service (SaaS) option to its future offerings.

Having established its market presence in North America, it might be time for NGC to further expand its global coverage. In order to do so, better capability in enhancing multicurrency management should be considered for future product releases.

User Recommendations

For brands, retailers, and importers of consumer products, such as apparel, footwear, fashion, home furnishings, eyewear, sporting goods, carpets, and so on, NGC's e-PLM and e-SPS together as a suite have high potential for meeting user requirements by improving product development and sourcing performance, especially users meeting one or more of the following criteria:

  1. The company's major operations are located in North America, but it has international global sourcing requirements.

  2. Being compliant with CPSIA and 10+2 is critical to the business.

  3. The IT infrastructure blueprint welcomes the Microsoft environment (i.e., Microsoft SQL Server).

If you are interested in knowing about NGC's fashion PLM solution in more depth, you can access NGC's e-PLM functionality report here. You can also compare NGC's e-PLM with other fashion PLM solutions through TEC's PLM Evaluation Center.

The interactions that TEC analysts have had with NGC and its e-PLM and e-SPS solutions demonstrate the vendor's great capability for both forward thinking and turning insights into executable and practical product functionality and features. We expect to see e-PLM and e-SPS—already a strong fashion PLM and sourcing suite in the market—become even stronger in the near future.

 
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