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Global Kickoff 2011 Manhattan Associates Value Assessment (MAVA): Executive Summary

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Page 1: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

Global Kickoff 2011

Manhattan Associates Value Assessment

(MAVA):

Executive Summary

Page 2: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

2 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Stores Post-Sale ecommerce

Home Delivery Distribution

1. Outdated Home Delivery system

Highly modified / difficult to maintain & upgrade

Requires highly specialized users

Contains design flaws & allows data entry errors

Lacks documentation

2. Multiple fulfillment systems, not fully integrated

3. Limited visibility to…

Order fulfillment status

Inventory availability

Returns & unsuccessful deliveries

4. Inventory availability updated only once per day

5. 2 different WMS in the same fulfillment facility

6. Product not available in ecom DC is not displayed

in web storefront

Key Challenges & Areas of Opportunity

Cross-Channel Enablement

1. Buy online, Pick Up in Store

2. “Save the Sale”

3. Cross-Channel Inventory Management

4. Buy Anywhere, Return Anywhere

Suppliers Stores Retail DC Ecom DC

Home Delivery System

AS400

Paris 2

Business & Financial Impacts

↑ Shipment delays unhappy customers

↑ More out-of-stocks and lost sales

↑ Higher credit notes

↑ Higher operating costs in inventory, transportation, labor,

capacity

↑ Higher IT support costs

↓ Poor customer experience and lower retention rates

Page 3: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

3 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Proposed Supply Chain Solutions

Stores Post-Sale

Suppliers Stores

Integration Framework

ecommerce

Distributed Order Management

Reverse Logistics Management

Retail DC Ecom DC

Key Solution Features

1. Flexible technology that is easy to change and adapt

2. Standard integration with WebSphere Commerce

3. Global visibility to inventory, orders, and shipments in

DCs, suppliers, stores, and in-transit

4. Configurable rules and workflows

5. Rules-based order orchestration for Home Delivery

• capture all order types – ecommerce, retail, call

center orders

• real-time Available-to-Promise (ATP) capabilities for

use in stores or on web

• auto select most optimal location for distributing

orders across channels (suppliers, DC, stores) based

on geography and business rules

• dynamic order prioritization and allocation

• supplier drop ship orchestration

6. Virtual inventory segmentation across channels

7. Advanced Returns Processing

• Rules-Based Returns Initiation (Web, Call Center)

• Returns Processing (DC or Store)

8. Cross-Channel Enablement

• Buy Online, Pick Up in Store

• Buy Online, Return to Store

• Buy anywhere, fulfill from anywhere

Sell

Orc

he

str

ate

F

ulfill

Page 4: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

4 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Se

ll O

rch

estr

ate

F

ulfill

Proposed Technology Roadmap

Web Storefront

Point of Sale

Call Center

In-Store Capture

Order & Inventory Visibility

Order Sourcing / Allocation

Order Creation & Release

Returns & Exchanges

Retail DC Fulfillment

Ecom DC Optimization

Vendor Fulfillment

Store Fulfillment

Homegrown

Paris POS

Post-Venta

Paris POS

Paris 2

Paris 2

Paris 2

Paris 2

Potenciado

B2B

Actual

Warehouse

Management

Paris POS

Post-Venta

Paris POS

MMS

B2B

Phase 1

Warehouse

Management

MMS

Warehouse

Management

DOM

Sales Order

Management

Reverse Logistics

Management

DOM

Paris POS

CPWEB

CPWEB

MMS

MMS

MMS

Levicom

Future Phases

Warehouse

Management

Warehouse

Management

Supplier

Enablement

Store Gateway

Distributed

Selling

DOM

Sales Order

Management

Reverse Logistics

Management

Page 5: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

5 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

“We Need a Business Case”

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6 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Gift List

1. EMS Gloves

2. EMS Hat

3. …

EMS Store - Ashburn

EMS Store - Arlington

1. “Buy Online, Pick Up in Store”

2. “Incremental In-Store Sales”

3. “Save the Sale”

Holiday Shopping with Eastern Mountain Sports

Page 7: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

7 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Summary of Savings

Hard Savings Quantified:

Home Delivery Distribution

I. Increase Online Sales – “Buy Online, Pick Up in Store”

II. Reduced losses due to Home Delivery system

downtime

- Reduced Delays

- Reduced DC Down Time

- Elimination of Double Deliveries and Extra Trucks

- Reduced Credit Notes

- Improved Service Levels

Cross-Channel Enablement

III. Increases Retail Sales – “Save the Sale”

IV. Increase in Inventory Turns

Soft Savings:

• Improved productivity of managers and supervisors

Hard Savings Not Quantified:

• Reduced IT support costs

• Productivity at DCs, Call-center, IT & Stores

• Visibility of order and inventory status

• Direct ship from supplier savings

• Inventory segmentation-related savings

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8 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

I. Online Sales Parameters and Assumptions (USD$)

Buy Online/Pickup In Store Inputs

Inputs

Today: No in-store

pickup

With In-store Pickup

via MA Solution

Online Sales as % of Revenue 10%

Estimated Online Revenue 124,087,081$ USD$

Online transactions per year 150,000

Average in-store pickups 0% 25%

Online average out of stock % 0.25%

Percent of online out of stocks that result in no sale 50% 25%

Average number of cart starters per day 411

Cart abandonment at shipping costs 15% 10%

Average cart size $210 USD$

Additional in-store spend when picking up in store $14.70

Percent of in-store pickups that are incremental trips 30%

In-store pickups per year 37,594

Percent of missed pickups 15%

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9 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

I. Online Sales Including “Buy Online / Pick Up in Store” Analysis In-Store Pickup - Cost and Benefit Calculations

With No In-Store

Pick Up Solution

(Today)

With proposed MA

In-Store Pick-Up

Solution

Current online sales $124,087,081

Increased revenues due to larger pool of available online inventory

Estimated increase in online sales (from

store inventory availability online) 2.00%

New estimated online sales 126,568,823$

Net improvement over no in-store pickup $2,481,742 USD$

Online sales lost to out of stocks

Online out of stocks 0.25%

OOS that results in no sale 50% 25%

% of online sales lost to OOS 0.125% 0.0625%

Online sales lost to out of stocks $158,211 $79,106 USD$

Net improvement over no in-store pickup $79,106 USD$

Online sales lost at shipping costs

Average # of cart starts per day 411

Cart abandonment at shipping 15% 10%

Average cart size $210.00

Online sales lost at shipping costs $4,725,000 $3,150,000 USD$

Net Improvement over no in-store pickup $1,575,000 USD$

Total sales lost online $4,883,211 $3,229,106 USD$

Net improvement over no in-store pickup $1,654,106 USD$

Page 10: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

10 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

I. Online Sales Including “Buy Online / Pick Up in Store” Analysis (cont.) Additional in-store sales from pickups

Average in-store pickups 25%

Total in-store pickup trips 37,500

Percent of in-store pickups that are incremental trips 30%

Total incremental trips 5,625

Additional in-store spend at pickup $14.70

Total potential sales from in-store pickup $82,688 USD$

Percent of missed in-store fulfillment of pick-ups 15%

Total lost in-store sales $12,403 USD$

Total net sales from in-store pickup $70,284 USD$

Total improvement in sales over no in-store pickup $4,285,237 USD$

Incremental Fulfillment Costs

$4,285,237

Average Unit Cost per Item $14.86

Additional Items Sold Through Store Channel 288,375

Incremental Fulfillment Costs per Item $2.00

Total Incremental Fulfillment Costs $575,307 USD$

Net Improvement in sales after fulfillment costs $3,709,930 USD$

Paris Online Sales Gross Margin 20.0%

Total Annual Estimated Increased DTC Profits $741,986 USD$

Improvement 2.9%

Total Saved Sales

Page 11: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

11 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Case Study: Store Fulfillment with Optimized Sourcing from Stores

Higher Sales Growth

“ We have significantly cut lost sales by routing customer orders to stores when the

DC is out-of-stock. We also see a good lift in our smaller footprint stores that can

now sell our full assortment. ”

Higher Customer Retention and Satisfaction

“ We resolved our biggest customer compliant by making our store level inventory

available online and now have the foundation to allow the customer to reserve the

product for in-store pickup. ”

Page 12: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

12 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

II. Home Delivery – Perdida Económica Sistema DaD *

Beneficios Paris nuevo DaD

# $ Margen $ CLP $ USD

Atraso Solicitudes Stock 14,003 2,801 487,764,391 20% 97,552,878 204,861 $

Atraso Solicitudes Internet 8,709 1,742 303,351,889 20% 60,670,378 127,408 $

Atraso Solicitudes PE-PD 7,101 1,420 247,359,996 20% 49,471,999 103,891 $

Dias CD sin Operación 5 43 51,000,000 100% 51,000,000 107,100 $

Doble Entregas 371 64,565,646 20% 12,913,129 27,118 $

Horas Hombre Administracion 14 21000.0 6,552,000 100% 6,552,000 13,759 $

Notas de Credito Año (1,3%) 30% 846,483,985 20% 169,296,797 355,523 $

Camion Extra Año 1 12 14,400,000 100% 14,400,000 30,240 $

Aumento de Venta Mejor Servicio 441,716 0 0 20% 0 - $

AHORRO FINAL

CLP 461,857,182 $

476 USD 970,288 $

* Savings estimated by Paris’ Logistics team and provided to Manhattan Associates as is

Page 13: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

13 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

III. “Save the Sale” Value Analysis

13

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14 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

III. Retail Parameters and Assumptions

General Company and Retail InputsCurrent Number of Stores 33

Total Revenue $1,240,870,810

Estimated Home Delivery Revenue $128,403,322

Estimated Online Revenue $124,087,081

Total Store Revenue (Less Home Delivery and Online) $988,380,407 USD$

Cost of Goods Sold (% of Revenue) 68.4%

Average Transaction Size (In Store) $50.52 USD$

Average Items per Transaction (In Store) 3.4

Average Unit Cost $14.86 USD$

Average Store Conversion Rate 25%

Incremental handling costs of in-store fulfillment $2.00 per item USD

When an employee can't help a customer, we lose 0.10 items per sale

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15 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

III. Retail Parameters and Assumptions

Save the Sale Inputs

% of Store Visits Where Customers Can't Find Item 15%

Customer Retail Habits

Of those customers that can't find an item, 60% (%) walk away without buying anything

10% (%) will settle for another item instead

30% (%) will ask an employee for help

100% Math Check

Of those customers that ask an employee for help, 10% (%) will find the item

25% (%) walk away without buying anything

20% (%) will settle for another item instead

45% (%) will have the employee call another store

100% Math Check

Of those customers that ask to call another store, 50% (%) will find the item

50% (%) walk away without buying anything

0% (%) will settle for another item instead

100% Math Check

Improvement Parameters

Of those customers that ask an employee for help, 40% (%) will be serviced by employee in the future using MA Solution

Broken out across their actions: 30% (%) Normally would have walked away without buying anything (now serviced)

10% (%) Normally would have asked employee to call another store (now serviced)

40% Math Check

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16 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

III. Retail “Save the Sale” Value Analysis Benefit Area: Lost Store Sales

Improved Profits from MA Employee Retail Service Solution

Number of Stores 33

Total Store Revenue $988,380,407 USD$

Average Store Transaction Size $50.52

Average # of Transactions Per Store Per Year 592,807

Conversion Rate (In Store) 25%

Average # of Visits Per Store Per Year 2,371,228

Percent Number

Visits That Can't Find an Item 15% 355,684

Of Visits That Can't Find an Item:

Visits that walk away 60% 213,411

Visits that ask for help and then walk away 7.5% 26,676

Visits that ask for help, call another store, then walk 6.8% 24,009

Total # of lost visits per store per year 264,096

Average Transaction Size (In Store) $50.52 USD$

Average Conversion Rate (In Store) 25%

Total lost sales per store per year $3,335,784 USD$

Total Chain Lost Sales $110,080,868 USD$

Visits That Normally Walk, Now Serviced by Employee with MA Solution 4.1% 14,405

Visits That Normally Call Another Store, Now Serviced by MA Solution 0.7% 2,401

Total # of lost visits saved 16,806

Total saved sales per store per year $212,277 USD$

Total Paris Retail Saved Sales $7,005,146 USD$

Page 17: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

17 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

III. Retail “Save the Sale” Value Analysis

Incremental Fulfillment Costs

Total Saved Sales $7,005,146 USD$

Average Unit Cost per Item $14.86 USD$

Additional Items Sold 471,410

Percent Picked Up in Store Channel (vs. Shipped) 85%

Additional Items Sold through Store Channel 400,699

Incremental Fulfillment Costs per Item $2.00 USD$

Total Incremental Fulfillment Costs $799,394 USD$

Net Improvement in sales after fulfillment costs 6,205,752$

Paris Retail Gross Margin 31.6%

Total Annual Estimated Increased Retail Profits $1,961,018 USD$

Improvement 0.63%

Page 18: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

18 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Case Study: The Men’s Wearhouse Cross Channel Enabling the Store Environment

• Real time ATP to save lost sales

• Real time order status

• Inventory visibility by location

• Buy online, pickup in store

• Buy online, return in store

• Store receiving

• Store transfers

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19 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

• Paris Current Days of Inventory = 72 (5.07 Turns)

• For SIC Code 5211 – Department Stores (South America) – Median = 75

– 1st Quartile = 50

IV. Inventory Analysis – Industry Averages

Page 20: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

20 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

IV. Inventory Savings – Improved Turns

• Inventory Segmentation: – Leveraging inventory across online and retail channels as one virtual pool

Inventory Characteristics (USD$)

Current and Planned Inventory Characteristics

Current Year 1 Year 2 Year 3 Year 4 Year 5

Inventory Level $167,333,999 $192,434,098 $211,677,508 $232,845,259 $256,129,785 $281,742,763

Planned Inventory Growth Rate 15% 10% 10% 10% 10%

Inventory Turns per Year 5.07 5.20 5.20 5.20 5.20 5.20

Average Inventory Days On-Hand 71.99 70.22 70.22 70.22 70.22 70.22

Cost of Goods Sold (COGS) $848,383,373 $1,000,243,997 $1,100,268,396 $1,210,295,236 $1,331,324,759 $1,464,457,235

Estimated Improvement

Year 1 Year 2 Year 3 Year 4 Year 5

Expected Percent Reduction in Inventory 2% 3% 3% 3% 3%

New Inventory Turns 5.30 5.36 5.36 5.36 5.36

New Average Inventory Days On-Hand 68.82 68.11 68.11 68.11 68.11

New Inventory Level $188,585,416 $205,327,183 $225,859,901 $248,445,891 $273,290,481

Net Change in Inventory $3,848,682 $6,350,325 $6,985,358 $7,683,894 $8,452,283

Cumulative Change $3,848,682 $2,501,643 $635,033 $698,536 $768,389

Page 21: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

21 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

IV. Inventory Savings (cont.)

$0

$50,000,000

$100,000,000

$150,000,000

$200,000,000

$250,000,000

$300,000,000

Year 1 Year 2 Year 3 Year 4 Year 5

Av

era

ge

On

-ha

nd

In

ve

nto

ry

Inventory Level by Year(Network)

Inventory w/o Manhattan

Inventory w/ Manhattan

Inventory Carrying Costs as a percent of Total Inventory 12.00%

$832,166

$4,272,948

Average Annual Inventory Savings (USD$)

Total 5-Year Inventory Savings (USD$)

Page 22: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

22 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

5-Year Savings Summary (USD$)

Savings by Area (5-Year)

Savings Area $ Savings % Total Savings

I. "Buy Online, Pick Up in Store" $5,234,857 22.7%

II. Sistema DaD - Reduced HD Losses $4,530,230 19.7%

III. Retail Store Profits - "Save the Sale" $9,155,898 39.7%

IV. Cross-Channel Inventory $4,130,446 17.9%

Total $23,051,431 100%

22.7%

19.7%39.7%

17.9%

Total Savings(5 Years)

I. "Buy Online, Pick Up in Store"

II. Sistema DaD - Reduced HD Losses

III. Retail Store Profits -"Save the Sale"

IV. Cross-Channel Inventory

Savings by Area

Page 23: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

23 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Manhattan MORE™: Resources & Methodology

• 800+ consultants worldwide. 400+ in the Americas

• Experienced staff

– With MANH: 4.7 years

– Industry: 6.3 years

– LATAM Team: 6.8 years

• Consultants specialized by solution suite:

– Distributed Order Management

– Reverse Logistics Management

– Warehouse Management

– Integration specialists

• Relevant OLM Project Team Experience in the US & LATAM

• Proven Implementation Methodology at Paris – Manhattan RPM™ certified ISO 9001 y proven at Paris during WMS deployment

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24 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Manhattan Associates Implementation Team

Project Manager

Project Director

Functional

Consultant - DOM

Cesar Berenguer • 12 years

• Sr. Director, LATAM

Design Leader

DOM

Geophrey Parry • 9 years

• 20+ projects

Vaibhav Gupta 5 years

• 10+ projects

Miguel Vian • 4 years

• 5 projects

Technical

Consultant - DOM

Mike Olshansky 5 years

• 11+ projects

Manhattan Associates

Technical

Consultant - RLM

Sharan Kumar 2 years

• 5+ projects

Design Leader

RLM

Vaibhav Gupta 5 years

• 10+ projects

Functional

Consultant - RLM

Ajay

Veeraraghavan 5 years

• 10+ projects

Page 25: Manhattan Associates Value Assessment (MAVA) - …robertjallen.yolasite.com/resources/Portfolio.pdfManhattan Associates Value Assessment (MAVA): ... Cross-Channel Inventory Management

25 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Why Manhattan Associates

Most Value Lowest TCO Least Risk

High Functional Fit to Home Delivery

Requirements

• Complete home delivery Solution for today and in the future

• Flexible technology that is easy to change and adapt

• Standard integration with WebSphere Commerce

• Rules-based order orchestration

• Advanced Returns Processing

• Virtual inventory segmentation across channels

• Cross-Channel Enablement

• Complete WMS solution for retail & ecommerce fulfillment

Experience & References

• Better understanding of Paris’ functional requirements

• Major modifications identified thru a detailed MAVA process

• Proven solutions in Latin America

• Proven solution in projects of similar size & complexity

Experienced Implementation Team

• 800+ employees across the Americas

• 700+ employees in R&D

• 250+ employees in Customer Support

• Deep retail domain expertise

Long Term Supply Chain Technology Partner

• Transparency & consistency

• Strong balance sheet (0 debt) & ability to invest ($100M+in

cash)

• $250M+ invested in SCM R&D in last 5 years

• $185M+ in cash generated in last 4 years

• Commitment and investment in Latin America

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Global Kickoff 2011

Manhattan Blended Channel Solutions Brian Kinsella, Manhattan Product Management

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27 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Order Lifecycle Solutions Strategic Vision

Manhattan Associates will be a recognized, best in class, proven

provider of cross channel solutions for our target markets of (1) multi

channel retail and (2) consumer goods manufacturers with retail / direct

operations

direct

retail

wholesale

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28 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Your Customer Sees One Retail Brand…

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29 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

… and We Believe You Need a Single Place to Manage All Her Transactions

SINGLE TRANSACTION REPOSITORY

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30 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

eCommerce Continuing to Increase in Importance

“ … a stunning 40 percent of all products

purchased online are picked up in-store.”

CEO of leading electronics retailer

September, 2010

Forrester Research estimates that

online and Web-influenced offline

sales combined accounted for

42 percent of total retail sales

and that percentage will grow to

53 percent by 2014.

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31 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Source: The Nielsen Company

Consumers Enter the Store with the Internet in Hand

16% 18%

21% 23%

Q2 '09(n=59,725)

Q3 '09(n=59,842)

Q4 '09(n=57,276)

Q1 '10(n=55,691)

Smartphone…

Smartphone Penetration All Mobile Subscribers, Mobile Insights, National

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32 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Your Store Associates Have an Information Deficit

>

product knowledge product knowledge

Let me borrow your phone for a second …

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33 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

41%

48%

63%

73%

85%

12%

75%

31%

44%

81%

Offer customized and unique product offerings

Improve operational execution across all channels

Allow customer to purchase, take delivery, or returna product through the channels of their choice

Consistent and clear explanation of productfeatures and benefits regardless of channel

Create single brand identity across all channels

How important is each of the following opportunities to create improved customer satisfaction across all channels?

Laggards Winners

What are the characteristics of tomorrow’s winning retailer?

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34 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Evolution, Not Revolution

0%

31% 31%

25%

13%

6%

21%

41%

18% 15%

3%

14%

26%

34%

23%

Single ChannelOnly

< 2 years 2-5 years 5-10 years > 10 years

Winners Working Multi-Channel Longer

Laggards Average Performers Retail Winners

Source: RSR Research, February 2009

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35 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Customer Centricity: The Cross Channel Imperative

OPERATING PRINCIPLES

single brand

to the customer

delight the anywhere /

anytime customer

use scale to drive profitability

ASSOCIATED PROCESSES & PRACTICES

• buy online; pick up in store

• buy online; return to store

• see store inventory via webstore and mobile

device

• avoid lost sales – sell against network wide

inventory

• endless aisle – sell vendor held and fulfilled

items

• virtual segmentation of inventory

• cross functional logistics: factor inventory,

labor and transportation costs when sourcing

• repeatable, efficient store fulfillment activities

• application consolidation and platform

leverage

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36 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

The Killer Enterprise App for Retail: A Platform for Cross Channel Commerce

Network Inventory Visibility

Enterprise Order Management

CROSS CHANNEL COMMERCE PLATFORM

CUSTOMER ENGAGEMENT

RETAIL OPERATIONS

eCommerce point of sale

social platforms mobile

contact center /

store

Inventory

transaction capture in store fulfillment order orchestration

1

2 2

3 4

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37 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Agenda

• See Everything – Providing Tools to Enable Accurate Network Wide Inventory

• Sell Everywhere – Distributing More Powerful Order Entry and Management Capabilities

• Fulfill Anywhere – Moving Beyond Order Orchestration to Fulfillment Optimization

– Fulfilling from the Store, A Purpose-built Solution

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38 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Build a View of Network Inventory to Sell More

Suppliers /

Inspectors

Logistics Service

Providers Carriers Warehouses

Deconsolidator /

Freight Forwarder

Stores

Consumers

Direct-to-Store

Store

Gateway

Supplier

Enablement Hub

Management

Supply Chain Visibility

WMS

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39 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

The Increased Importance of Accurate Store Level Inventory

inventory management

Achieve Store Inventory Integrity to Ensure High Customer Satisfaction

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40 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

All Stores

Accept Inventory Updates from Trickle Polling System

Global Inventory

Visibility

inte

gra

tion f

ram

ew

ork

Distribution Centers

Use existing PIX transaction feed

Trickle

Polling DB /

Application

Real-time

trigger

Feed XML

in 15 minute

intervals

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41 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Process Facility Inventory Synchronizations Use direct SQL connection to extract inventory data

Global Inventory

Visibility

DC’s

Vendors

Other Stores

ERP / Host

DC’s (from WM)

Vendors (drop

shipment)

Stores Data Extract, Transform, and

Load (ETL)

• Retrieve all inventory for all

locations each night, approx

60M records

• Data ETL allows for

complete update in several

hours

Extract and send nightly

inte

gra

tio

n fra

me

wo

rk

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42 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

A Network View of Inventory Means More Sales

ERP

eCommerce / Retail / Wholesale

Global Inventory Visibility

Customer Orders / Store Allocations

Inventory Levels / Orders / Order Status

Order Management

Point of Sale Retail Replenishment eCommerce

DC1 Stores Vendors DC 2

In-Stock

(DC)

In-Stock

(Vendor)

Allocated

Available

Allocated

Available

Allocated

Available

Allocated

Available

On Order In-Transit In-Stock

(Store)

Allocated

Available

Selling / Sourcing / Allocation / Release / Monitoring

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43 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Vanity Fair – Implementing an Order Hub to Increase Order Velocity

$7B multi-brand apparel and footwear wholesaler and retailer

Challenges

• Have evolved to be a direct and store based retailer, in addition to the historical wholesale business

• Substantial growth in retail and direct channels, and need cross channel solutions

• Manage a common pool of inventory, but have engineered an overly complex method of doing so

• Complexity causing order flow and inventory visibility latency

Manhattan Solution

• Sales Order Flow Management

• Warehouse Management

Implementation Timeline

• Q3 2011 Go-live

Cross channel inventory allocation

Integration with WebSphere Commerce, SAP, and Island Pacific

Inventory segmentation, including ties to i2 demand planning

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44 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Save the Sale with Distributed Selling in Store

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45 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Save the Sale with Distributed Selling

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46 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Save the Sale with Distributed Selling - Mobile

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47 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Save the Sale with Distributed Selling - Mobile

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48 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Lamps Plus – A New Approach for Enterprise Order Management

$ 400M DTC and B2B specialty retailer of lighting

Challenges

• Legacy, homegrown, costly custom order management system

• Limited inventory visibility: no ability to see store inventory, sell against future inventory

• Existing order management system operates in batch – cannot respond to real-time inventory events

• In-store order management system has limited capabilities and is on aging technology

Manhattan Solution

• Distributed Selling

• Sales Order Flow Management

• Reverse Logistics Management

• Warehouse Management

Implementation Timeline

• Q4 2011 Go-live

Call center / contact center

Enterprise order management

Fully integrated returns process

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49 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Optimized Sourcing from Stores

• Not all stores are created equal

when it comes to ability perform

fulfilment

• Need to simultaneously factor

inventory, labor and

transportation cost when making

sourcing decision

• Exception management is critical

Sourcing Template: DTC Normal Priority

Tier 1: Distribution Centers

Eligible Location Groups:

• BBB Distribution Centers

Location Priority:

Manual

Sort by geographical proximity

Tier 2: Regional Fulfillment Stores

Eligible Location Groups:

• East Coast RF Stores

• Midwest RF Stores

• West Coast RF Stores

Location Priority:

Manual

Sort by geographical proximity

Tier 3: Standard Footprint Stores

Eligible Location Groups:

• 10,000 sq ft stores

• Large footprint standard stores

• Mall stores

Location Priority:

Manual

Sort by geographical proximity

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50 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Case Study: Optimized Sourcing from Stores

Band 1: within 25 miles

Band 2: within 100 miles

Band 3: beyond 100 miles

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51 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Buy Online, Pick Up in Store

eCommerce

mobile

Store inventory point of sale

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52 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

New In-Store Business Processes Required Buy In-Store, Pick up in Another Store

Retail

Consumer

Store

Store to Store Transfer

Retail

Consumer

Store Return to Vendor/DC

Retail

DC Vendor

Buy In-Store, Ship from Store, DC or Vendor

Consumer

Store

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53 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Web-Based Parcel Execution

Solution Capabilities

• Centralized management of enterprise parcel

needs

• Zero rate table maintenance

• Full support for negotiated rates

• Automated tracking of parcel shipment events

• Automated capture of proof of delivery

signatures

Value Created

• Lower TCO for mass deployments

• Lightweight, centralized solution …easily

deployed to the extended supply chain

• Encapsulated user workflows within a single

user experience

Manhattan Solutions

• Supplier Enablement (drop ship)

• Hub Management (drop ship)

• Store Gateway (in-store order fulfillment)

Web Based Parcel Execution

Parcel Requests…

Carrier Replies…

SCOPE Parcel

Carrier

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54 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Electronic Documents Captured

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55 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

How Do I Get There From Here?

Network Inventory Visibility

Enterprise Order Management

BLENDED CHANNEL COMMERCE PLATFORM

CUSTOMER ENGAGEMENT

RETAIL OPERATIONS

eCommerce point of sale

social platforms mobile

Contact

center / store

inventory transaction

capture in store fulfillment order orchestration

1

2

5

3

4

1

6

The Men’s Wearhouse

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56 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

How Do I Get There From Here?

Network Inventory Visibility

Enterprise Order Management

BLENDED CHANNEL COMMERCE PLATFORM

CUSTOMER ENGAGEMENT

RETAIL OPERATIONS

eCommerce point of sale

social platforms mobile

Contact

center / store

inventory transaction

capture in store fulfillment order orchestration

1

2 5

3

4

Dick’s Sporting Goods

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57 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

How Do I Get There From Here?

Network Inventory Visibility

Enterprise Order Management

BLENDED CHANNEL COMMERCE PLATFORM

CUSTOMER ENGAGEMENT

RETAIL OPERATIONS

eCommerce point of sale

social platforms mobile

Contact

center / store

inventory transaction

capture in store fulfillment order orchestration

1

2 3

4

Bed, Bath Beyond

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Global Kickoff 2011

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59 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Brian Kinsella manhattan product management [email protected]

2300 Windy Ridge Parkway

10th floor

Atlanta, GA 30339

USA

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Global Kickoff 2011

Transportation Lifecycle Management: Global Kickoff Meeting

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Global Kickoff 2011

Controlling our Destiny

Customer Satisfaction & Referencability

Fleet Planning and Execution

Successful Implementations

Leveraging the Platform

Market Leadership

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Global Kickoff 2011

Target Market

Retail

Wholesale MFG

Domestic

Food

Private Fleets

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Global Kickoff 2011

Private Fleet Summary

• This is a large market spread across a large

number of verticals and segments.

• Out of the top 100 only 5 are Manhattan

Associates TLM customers.

• The top 100 private carriers in the industry

make up roughly 12% of the total GDP in the

US in 2009.

• Total revenues of the top 100 were

approximately $1.783.38 trillion, which

includes $401 billion for Wal-mart (current

TLM customer).

• Out of the top 500, 275 are food processing,

manufacturing/processing or retail/wholesale.

• For the purpose of further analysis I have

taken Wal-mart out of the list to provide a

more objective analysis.

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Global Kickoff 2011

Leverage the Platform

Fleet Planning and Execution

Setting the Standard

One defends when his strength is inadequate, he attacks when it is abundant.

Sun Tzu

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Global Kickoff 2011

Next Generation Application

The WMS-TMS platform offers a comprehensive set of business workflows for both warehouse

and transportation users, with transparent separation of duties where warehouse users and

transportation planners interact with a single application

Pre-Platform Platform

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66 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

In Summary:

Value Drivers In Private Fleet Operations

Step I Step II

Step III

Drive value from fleet outbound optimization

• Enhance outbound planning workflows using optimized routes from fleet consolidation and interactively evaluate/modify using next-gen MCW

Enhance accuracy and efficiency of dispatch operations

• Enhanced outbound execution using fast, easy to use dispatch workspace and Driver and Load

• Plan optimal round trips with inbound shipments and outbound shipments

Maximize asset utilization with inbound/outbound planning

• Advanced planning of inbound orders with projected outbound order profiles

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67 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Customer Success

Product Customer Highlights

TPE HEB • Implemented Capacity Finder

• Extended Inbound workflow to include DC-DC transfers, inclusive of cross-

docking

• Enabled Appointment Scheduling at 6 of 10 DC’s

• First U.S. based customer using the MA Dispatch System (Dispatch

Execution and Optimization) for a Private Fleet.

Hudson Bay • Live with Inbound and Outbound Planning

• Integration to WMOS 2009 with a flow-through workflow.

Home Depot • Live with Appointment Scheduling.

• On-boarded 500+ vendors.

C&S • Inbound solution deployed across network

• OB FSP at 1 site

Misc • DSG live with Archive and Purge

• Ventura Foods TP&E 2010 upgrade

• Kroger IB stabilized and transitioned to CSO

TP 2 Bids • Results from 2 bids were $3.45M savings on $121M spend

CM 33 Go-Lives • Enabled new Enroute Load Assignment (ERA) functionality

oHelped Panther Expedited improve operating margin 5% in only 3

months.

• Enabled new Fuel and Route Tolls functionality (exclusive to MA in the

CM industry) at multiple Carrier clients.

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68 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Key 2010 Wins - TLM

Account

McKesson

Home Hardware

DECA

Gainey

Challenger

Panther Expedite

HP (TP)

Elektra

Guardian Industries

EPES

AAA Cooper

Baylor

Total

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69 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

Marketing Levers: TLM

TLM

Lever 2

Differentiate with a

distinctive PoV

(Fleet/Inbound &

Outbound)

Lever 1

Be More Visible

Lever 3

Align with WMS

Q1 Q2 Q3 Q4

Lever 1 • TLM analyst tour

• NRF

• FMI/GMA

• RILA

• TCA 2011

• ARC TMS Outlook

• SCM Review (Trans

Role in SC)

• NRF SC Summit

• FMI

• DC Velocity

(TMS)

• TMS MQ

Publishes

• CSCMP

• ATA

• IFDA

• Industry Week

(Trans Trends)

• Logistics Mgmt

(Optimizing TMS)

Lever 2 • Private Fleet

thought leadership

program

• Chain Store Age

(Fleet

Management)

• Logistics

Management (TMS

trends)

• DC Velocity (TMS)

• Private Fleet

thought leadership

program

• MMH (Fleet

Management)

• Wholesale „ZDR‟

• Wholesale „ZDR‟

• Grocery „ZDR‟

• TMS Exchange

• 3 different fleet

articles

Lever 3 • Momentum • WMS/TMS Thought

Leadership

program

• WMS/TMS Thought

Leadership

program

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70 Copyright 2011 Manhattan Associates, Incorporated. Strictly Confidential. Not for Distribution.

Global Kickoff 2011

2011 and Beyond……..

• Private Fleet Thought Leadership

• Execute on new upgrades and go-lives.

• Leverage TLM WM integration to clear platform differentiation.

• Ensure continued customer satisfaction and referencability.