The Secret of One Vendor's Success in the Retail Supply Chain




Eqos (http://www.eqos.com) is a UK-based provider of on demand, Internet-based global sourcing and supplier management solutions for the retail supply chain worldwide. For more background on the vendor's beginnings and early growth, please see One Vendor's Quest to Garner a Global Sourcing Ecosystem and A Retail Sourcing Suite Built on Experience.

Eqos's Underlying Collaboration Platform

At the core of Eqos's offering is a platform that provides the key components for business to business (B2B) collaboration, including process management, workflow management, portal management, business rules, reporting, analytics, Web services, alerts and exceptions, and security. While these features are available out of the box, individual business processes can always be built to better match the customer's current and future sourcing and supplier management practices.

In other words, the technology enablers of the platform provide a virtual framework that allows merchandising and purchasing organizations to rejuvenate their outdated sourcing and supplier management processes. One example of such an enabler is a single extensible markup language [XML]-based data interface with a well-defined schema and Web services wrapper that can be leveraged for secure integration over the Web. Because Eqos's offering is built on the service-oriented architecture (SOA) concepts of reusability and standards-based interoperability, and is based on the vendor's extensive experience with legacy systems and packaged applications integration, Eqos can deliver pre-configured, cross-enterprise business processes that blend both new and legacy functionality into a more coherent process.

In tune with the ideas of business process management (BPM), Eqos equips customers to configure and reconfigure (or orchestrate) processes as they evolve over time. As already mentioned, interoperability and connectivity are key tenets of Eqos's collaborative platform, since businesses have to rely on their existing IT assets to streamline, configure, and support business processes that span enterprise, supplier, and related service provider operations. The BPM tools thus also allow the application to be configured to support well-oiled business processes rather than it being “shoehorned” (or forced). For more background, please see Business Process Management: A Crash Course on What It Entails and Why to Use It.

The platform enables business analysts to model the data, process and interface requirements of the organization, and generate software to support the execution of that model. This is facilitated by the architecture, which features multiple layers of services and defined interfaces, such as

  • data services to model business information needs and map to databases;
  • presentation services to model interactions between people and the software;
  • application services to model business rules, processes, and workflow;
  • security services to ensure appropriate segregation of duties and information; and
  • external Web services to integrate with remote systems in a secure manner.

As the market becomes more aware of the benefits of an SOA architecture, companies' expectations have increased in terms of the achievement of cross-enterprise, business process support; a decrease in the risk associated with the integration of new systems; and improved use and realized benefits from legacy IT assets. It is crucial to achieve integrated visibility across supplier networks (including the industry content), as legacy IT assets also deliver value to new business models, and there is an allowed evolution of solutions as new technologies become available, without massive disruption to the entire systems' footprint.

Enabling a Single Version of the Truth and Managing Critical Paths

Some of the typical benefits of the above architectural concepts are the users' ability to leverage existing IT investments through data integration in order to enable quicker response with real-time transaction processing, while removing constraints to evolve capabilities as new technologies become available. It is important to note that the Eqos platform features a single repository of data and process information for user enterprises and their supply chains. This is because today's retail environment requires more than the ability to simply track a product's success, given that the large multinational retailers (channel masters) want to manage everything from product launches through to the planning, execution, and post-event analysis of retail events.

Accordingly, Eqos's centralized repository of information ensures that accurate and vital product information is in place to facilitate this analysis for all the parties. To that end, an online archive and image catalog of every product can be retained in the system together with the information pertaining to the packaging artwork and specifications that are shared with packaging designers and manufacturers. This can ensure more precise control during the design phase.

Additionally, given the many parties involved and the countless interactions that take place across the retail supply chain (where many things can go wrong), critical path management—from concept to product delivery—is the cornerstone of Eqos's entire offering. In the realm of project management, the critical path is the set of activities that defines the duration of the entire project activities' network. Since these critical activities have very little float or slack (usually zero), a delay in any critical path activity will delay the entire project. Many retailers are driving shorter cycle turns across more seasons, which leads to both increased volume and complexity. Managing such an environment is creating the need for better control and increased visibility to ensure that scheduled activities progress according to plan, and that stakeholders are appropriately notified of exceptions.

Thus, the idea of leveraging critical path management is to enable buyers to automate and simplify complex sourcing processes, allowing them to manage more product lines more quickly and with a lower risk of failure. By leveraging standard project task structures that include responsibilities and due dates, Eqos's solution, somewhat similar to Microsoft Project, enables users to specify an ideal critical path and measure against it. It also helps them deploy best practices (provided templates enable the rapid creation of similar new projects to be managed) across product lines and merchandising and purchasing organizations.

In addition, the solution presents graphical representation and manipulation of the critical path, monitors upcoming tasks and late tasks, sends alerts as necessary, and automatically sends updates to external systems that deliver value to major customers (such as Tesco, which manages tens of thousands of tasks in the Eqos system each day).

Some expected benefits from the solution's deployment include a more proactive management of retailing projects, more informed and more rapid decision making, and promoted collaboration through a shared understanding of the tasks at hand, where any identified slack can be taken out of the product life cycle.

Further, visual reporting tools and analytics are also essential in helping buyers, merchandisers, and other retail decision-makers gauge success or identify problem areas quickly. As explained in Contemporary Business Intelligence Tools, dashboards can enable executives to appraise the business, highlight selected issues, and drill down to analyze the root cause of problems relatively quickly. This ability comes from the insightful visual display of the status of product portfolios based on real-time data, while only aggregated relevant data are delivered via intuitive format to executives.

Focused on delivering a graphical picture of the business's health, Eqos Dashboards enables an aggregated visual comprehension of multiple product portfolios. In addition to gauging success and identifying problems quickly, this dashboard also allows multiple-level, drill-down capabilities through to original source documents. Users can save regular analyses as “favorites” and deliver on a predefined schedule, while outputs to an enterprise data warehouse are possible too, if appropriate.

As for enabling strategic trading partners to communicate throughout the sourcing process (the success of private label programs is highly dependent on retailer-supplier collaboration, from product design through to selection, production, and ultimate delivery to the distribution center [DC] and stores), Eqos Supplier Hub Management enables suppliers to self-register and maintain their factory profile information (that is, the rapid onboarding of new suppliers is made possible). This portal also provides suppliers with direct Web access to the retailers' systems, enabling them to comply with the contract terms, improve their response, and meet (or exceed) performance objectives. The portal also provides the foundation from which retailers can select prospective trading partners.

In terms of potential benefits, lower technology requirements for supplier participation allow for increased supplier involvement, which in turn removes information silos and barriers previously preventing supplier execution; supports more consistent interactions between the retailer and its suppliers; and drives up supplier performance by creating a culture of information-sharing.

Integrated Eqos Sourcing Suite

Eqos's platform alone is not sufficient to achieve the benefits claimed by the vendor and its customers, neither at the top line (from the growth of the private label business, faster time to market, better product availability and fewer stockouts, more competitive offerings and improved customer value, broader access to global sources and growth of direct imports), nor the bottom line (from decreased costs of goods sold [COGS], improved margins, improved efficiencies and reduced operating costs, reduced inventory and tied-up cash, better regulatory compliance, and better ability to manage risks).

Thus, to help with the “inconvenient truth” of retailers' reality—that there is still a bevy of tasks that require spreadsheets or other rudimentary personal computer (PC)-based tools (see The Anatomy of Retail Sourcing Processes)—built atop Eqos's collaborative platform are eight distinct modules with functional capabilities aimed to address retailers' pain points.

These eight modules can be deployed as stand-alones, or they can interact with each other in a many-to-many relationship. They can be grouped within the following two product suites: Eqos Global Sourcing & PLM and Eqos Supplier Management. By integrating global sourcing, supplier performance, product lifecycle management (PLM) processes, and supply chain visibility into a cohesive, feature-rich solution, Eqos enables retailers to more effectively manage trading relationships, improve their leverage for supplier negotiation, deliver increased margins, reduce markdowns, and identify additional global sourcing opportunities.

The Eqos Global Sourcing & PLM Suite

Since retailers operate in a global market, keeping track of sourced products at all the stages of their life cycles is a key concern. Eqos's Global Sourcing & PLM solution supports the entire sourcing process, from product concept definition to store delivery (which implies visibility of all orders and their fulfillment in the supply chain), including PLM and range fulfillment, product sourcing, order management, and logistics visibility. Comprised of the following four modules, the Eqos Global Sourcing & PLM suite allows customers to better appreciate the true cost of the sourced product:

  1. From early concept to product specification, the Eqos PLM & Range Fulfilment module proactively manages the design and commercialization process while enabling collaboration among buyers and suppliers. It further links the design process, the merchandise plan, and sourcing functions together, allowing buyers to monitor the status of new and existing products to meet season-critical dates.

    PLM initiates the new product development process by capturing and storing new product ideas, market trends, and the other early design concepts. It supports the design, creation, and testing of prototypes. Once selected, a “tech pack” is created for distribution and review by the suppliers. Historical information is captured for analysis and reporting purposes, and with a unified repository, the retailer and its suppliers have a single integrated view of product life cycle information.

    Range Fulfilment manages the execution of the range or line plan. It allows the capture of trends and concepts that influence the range, the products, both new and continuity lines that make up the range, such key measures as stock-keeping unit (SKU) counts, and financial data, against which the achievement of the plan is at risk of not meeting the critical season dates.

  2. Eqos Product Sourcing provides the ability to replicate best sourcing processes from core sourcing countries and into new sourcing locations. The module supports the sourcing process for private label merchandise from specification, through to selection and bid management, to the initial purchase order stage with the chosen supplier. It also proactively manages critical path tasks for the retailer across suppliers, buying offices, and other trading partners.

    The module captures detailed product specifications, including packaging and cost requirements. It also issues requests for quotes to suppliers and receives structured quotes with detailed costs. The user is then able to compare quotes to determine the best product features and costs against requirements; select products and instruct the supplier to specify best product features and costs against requirements; and define and track testing and sampling requirements. By doing so, potential benefits come from access to global suppliers with lower cost goods, ensured clarity of product details through collaboration with suppliers, improved ability to analyze and compare quotes, vendor negotiations, and the bringing together of traditionally disconnected pre-SKU and post-SKU processes.

  3. The Eqos Order Management module manages the acceptance of orders by the supplier and communicates any order changes in near real time. It proactively manages purchasing-related information flows, which encourages on-time shipments from factories and third party logistics (3PL) providers, and supports varying order structures, a multi-drop DC, or direct store delivery. The module also provides retailers visibility into shipments, with clear and standard labels that can be scanned directly upon receipt to streamline goods-handling activities and invoice reconciliation.

    By integrating via XML messaging to transmit to or receive from other systems, and by automatically alerting trading partners to new and updated order information, the module enables the supplier-buyer collaboration relative to order details, and thus provides a "glass pipeline" (visibility) of orders and their fulfillment in the supply chain via suppliers, DCs, or stores.

    In addition to ensuring a single version of the truth for all parties involved (as well as less miscommunications, misunderstandings, frustrations, etc.), its potential advantage can come from improved control through proactive alert management, facilitated rapid communication of order status, and post-order decisions that can be made against more current information.

  4. Finally, the Eqos Logistics Visibility module layers over existing systems, and standardizes integration links to the enterprise, supplier, 3PL, and other systems, thereby providing a single view of processes and information without ripping and replacing existing systems. As a visibility layer, it manages the information flow from the time the goods are dispatched from the supplier to the retailer, allowing all parties to know whether the order is arriving “on time in full,” and to facilitate the order-receiving process.

    Additionally, backed up by the critical path management capability, the module tracks SKU-level details of products in transit at each point in the process, and ensures that action is taken by appropriate parties at the appropriate time in the process. Eqos Logistics Visibility can also detail actual costs to perform the estimated versus actual cost analysis, and can enable an analysis of shipment delays in relation to original sourcing requirements.

This is part three of the series One Vendor's Quest to Garner a Global Sourcing Ecosystem. Part four continues the in-depth look at Eqos's collaborative platform solutions.

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

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