STORES magazine, January 2007
Sweet Suite
Perry Ellis builds system to manage productivity across third-party, retail and online channels
By Janet Groeber
The fashion house founded by designer Perry Ellis is on a roll. In October, the company opened a sleek new flagship in Miami’s Dolphin Mall, complete with a fashion show and appearances by the Miami Dolphins and Miami Heat cheerleaders.
The outlook wasn’t always so bright, however.
After Ellis died in 1986, talented designers (Isaac Mizrahi, Marc Jacobs and Tom Ford all worked for the company) left Perry Ellis and ownership changed hands. Women’s lines were dropped, and the menswear collections lost their luster.
Perry Ellis was acquired by Miami-based Supreme International in 1999, and the entire company was renamed Perry Ellis International. It acquired Munsingwear and private-label manufacturer Salant in 2003.
Through wholly owned subsidiaries, PEI’s brand portfolio now includes Original Penguin, Jantzen, Cubavera, Savane, Grand Slam, Natural Issue, Pro Player, the Havanera Co., Axis, Tricots St. Raphael, Gotcha, Girl Star and MCD, and holds third-party licensing trademarks from Dockers outerwear, Nike and JAG for swimwear and Ping and PGA Tour golf apparel.
Today, PEI is the fifth-largest men’s designer brand in the country. Its collection of dress and casual shirts, sweaters, pants, jeans and active wear, as well as men’s and women’s swimwear, is sold through major chains and department stores in the United States and Canada. PEI operates 32 outlet stores in 18 states and plans to open another 80 stores in the future.
The introduction of the Perry Ellis brand for men showcased in its new flagship unit means design is now in sync with its in-store-shop concepts. So with the front-of-the-house in order, updating the back end fell to CIO Luis Paez.
“We are a branded company that believes that branding goes beyond spending heavily on advertising,” Paez says. Rather, branding “is about being in touch with our end consumers and providing them with the right product at the right time and with the highest possible quality.” And technology makes those tasks possible.
Paez’s marching orders included managing its multiple channels – third-party retailers, company-owned outlets, online and Perry Ellis-brand retail stores — in order to get a better view of the end consumer. Further, he wanted to align the data that could be gleaned from its retail partners with that from the end consumer.
Specifically, PEI wanted the ability to track inventory levels and out-the-door pricing, but “had a difficult time finding a system that would do everything we were already doing, and one [that] key users felt would provide the value they expected,” Paez says.
Just as it was about to contract for a partial solution, Oracle Retail announced it was buying Retek — one of a number of strategic acquisitions (ProfitLogic, 360Commerce) designed to create a “best of breed” suite of technologies for supply chain, merchandising and store systems.
Power users
As part of its selection process, PEI selected two teams of power users — one for wholesale planning and another for store operations. “The idea was to be able to use the same team during the implementation,” Paez says.
There was a “quick” design phase, data conversion, a testing phase “for power users to become knowledgeable with the system,” a redesign and a final stage. The significant ROI the company seeks “could only be obtained by having the right resources in place, the right process and a low-cost implementation,” he says.
PEI hired Active Intelligence (Edina, Minn.) to implement Oracle Retail Merchandising System, RPM, Allocation, RESA and RDW. It retained Oracle Consulting to implement Oracle Retail Price Optimization and SIM. Skillnet (Cupertino, Calif.) was hired to implement 360Commerce, and Predictix (Atlanta) was used to implement the RPAS.
POS data sent to Perry Ellis by its retail customers “is brought into Oracle Retail as if it were [from] our own stores,” Paez says, and is used to maintain sales history and perpetual inventory before being imported into Oracle Price (ProfitLogic) for markdown recommendation.
Those recommendations, in turn, are passed to RPM using a custom interface to advise retailers what the optimum price should be. “We realize this is a job that used to be done by the retailer,” Paez says, “but our goal is to reduce the retail markdowns to a minimum while increasing sales.”
Since its management-issued mandate, the company has selected a number of additional vendors and solutions to help improve productivity, reduce inventory turns and improve lead times.
“We expect [that] as we better collaborate with our customers and forecast more accurate plans, we’ll be able to further reduce our inventory,” Paez says.
