Eastern Mountain Sports Forges a Trail to Merchandising Visibility

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	SNAPSHOT Organization: Eastern Mountain Sports (www.ems.com) is a leading outdoor specialty retailer. With more than 80 retail stores, a seasonal catalogue, and a growing online presence, EMS designs and offers a wide variety of gear and clothing for outdoor enthusiasts. Challenge: Improve visibility into merchandising operations for a wide range of users, from corporate executives to buyers and store managers. Strategy: Create a data mart using point-of-sale and legacy information. Pull information from the data mart into a central merchandising dashboard visible to authorized users throughout the organization. Extend these capabilities to external suppliers through dynamic reporting options. Results:Decision-makers can quickly access a unified, high-level view of key performance indicators such as sales, inventory, and margin levels, with the ability to drill down to granular detail to analyze specific transactions. This helps boost sales, allocate resources, and propagate best practices. Information Builders Solution: WebFOCUS, iWay Software, and Consulting.

WebFOCUS and iWay Help Outdoor Specialty Retailer Climb to New Heights

When customers of Eastern Mountain Sports (EMS) plunge their sea kayaks into the open surf or stake-down their tents in a freezing thunderstorm, they're probably not thinking about merchandising and supply-chain technologies. But the outdoor gear they depend on in those extreme situations is available when they need it, thanks to a business intelligence (BI) dashboard that helps store managers keep the shelves stocked with the products they need most.

Information Builders software helps EMS, an outdoor specialty retailer based in Peterborough, New Hampshire, analyze sales trends and control the supply chain, so customers always have the clothing and gear they need for their recreational adventures. Managers use the dashboard to assess sales, inventory, and margin levels, drilling down as necessary to detect opportunities and analyze potential problems. "We needed better visibility throughout the business," says Richard Pedott, vice president of planning and allocation at EMS. "WebFOCUS and iWay give us a complete view of our entire merchandising operation from one central dashboard."

Pedott leads a vital expedition – not into the backcountry, per se, but into the back-office of the business. His terrain is financial projections, inventory plans, and profit parameters, and he keeps the company on track by keeping a close eye on sales trends and market conditions.

"You need more than just good reporting tools to monitor today's retail operations," says Pedott. "You also need hooks into the production information systems to monitor events, gather current data, and combine it all in a cohesive way. That's what we get from Information Builders."

Mapping a New Path

Founded in 1967 by two rock climbers, EMS has grown into one of the nation's leading outdoor specialty retailers, with more than 80 retail stores in 16 states, a seasonal magazine/catalogue, and a formidable online presence. The privately held company designs, produces, and sells a wide variety of gear and clothing for outdoor enthusiasts, from backpacks and insulated parkas to cycling gear and summer shorts.

For Richard Pedott, the journey to BI began with a management-led buyout that triggered changes to all aspects of the business, including large-scale improvements to the company's information systems. "While we have steadily invested in the IT side of the business, our enterprise reporting software was dated and clumsy," Pedott says. For example, at the executive level, visibility into the business was very low. Employees manufactured most of the reports by hand, and valuable personnel resources were spent producing information rather than analyzing it.

EMS set out to discover the right reporting tools for the company. "We wanted to have transparency across the entire organization, with a reporting system that was easy to implement and deploy at remote locations," Pedott continues. "We also wanted it to be user-friendly so that anybody with basic Internet skills could learn the system very quickly."

EMS evaluated several of the leading products in the business intelligence field. Once the marketing claims were put to the test, the compass was fixed on Information Builders.

"WebFOCUS surpassed the other reporting tools for a number of key reasons," Pedott recalls. "Information Builders is very good at taking arcane data structures from various sources and presenting the results in a distinct, easy to understand view. The software is quick to implement. And because it is Web-based, it is accessible to us everywhere. But I think its strongest suit is usability. The product is unbelievably user-friendly. Information Builders has proven to be an imaginative partner with creative solutions."

With help from Information Builders' Consulting, EMS used WebFOCUS and technology from iWay Software, an Information Builders company, to develop an executive dashboard for monitoring the merchandising operation. The project took 90 days from concept to completion. "We were very pleased with the speed of deployment and the services we received from Information Builders' Consulting," Pedott says. "They formed a joint project team with our programmers that worked very efficiently."

The architecture is powerful yet extensible. EMS uses iWay technology to access point-of-sale information on an IBM AS/400 computer and load it into a Microsoft SQL Server data mart. From there, WebFOCUS presents the data through an executive dashboard that managers can access via simple Web browsers. "One of the reasons we like Information Builders' technology is its flexible architecture," says Pedott. "If we install new ERP software, we can simply use a different iWay adapter to load the data mart. The BI dashboard will continue to work without modification."

An Elevated View of the Landscape

Just as a climber must constantly assess his equipment, environment, and weather conditions to ensure a successful ascent, EMS uses WebFOCUS and iWay solutions to monitor the merchandising operation at a high level. Managers throughout the organization can study sales results and make inventory adjustments based on a near real-time view of the retail operation, while authorized users throughout the company can share insight through a common BI dashboard.

Already, more than 200 people at EMS use the BI dashboard to obtain a high-level view of merchandising processes. Soon, external users will benefit from Information Builders' technology as well, as EMS streamlines horizontal collaboration among suppliers, retailers, and customers.

"We all see the same information every day," Pedott says. "This allows us to quickly determine the top selling items in any space, or identify which stores are performing best. Because my sales managers can call up the same data that I see on the dashboard, we can easily share tips and initiate dialogues. We can even find out why some items perform better than others by analyzing the transaction characteristics and selling behaviors that produce the results."

For example, when EMS wanted to determine why footwear accessories were moving so briskly in its specialty stores, Pedott was able to instantly generate the necessary reports and share them with his managers online. "Once we noticed that accessories sales were up dramatically, we drilled down into the data to zero in on a specific product. Turns out that there was a large increase in the sales of inner soles."

Pedott suspected the specialty stores were selling these high-margin items because of a unique shoe-fitting approach. Could their tactics be shared with the rest of the retail network?

"These stores had perfected a multi-step sales technique that included the recommendation of socks designed for specific uses, such as hiking or running, along with an inner sole that could be custom-fit to each customer," Pedott explains. "WebFOCUS made it easy to analyze the data to see what was selling, then drill down to see why. After that, it was a simple matter to cascade that information throughout the organization to boost sales across the enterprise. We gained insight that we were then able to share with other stores throughout the company."

The Next Leg of the Voyage

Surveying the trail ahead, Pedott believes WebFOCUS can lead the company to a number of new management vistas. "We intend to use the system for micro-sorting, dialing into the most granular level of product detail, such as colors and sizes," he says.

EMS is also mapping out plans for more detailed online interaction with its suppliers, possibly through collaborative planning, forecasting, and replenishment (CPFR) techniques. BI technology helps EMS know exactly what customers are buying. By tracking data at the point of sale, the company can quickly re-stock inventory to meet customer demand, reducing carrying costs. "If our suppliers know exactly how certain products are selling, they can ramp up production accordingly," Pedott explains. "It's just a question of visibility. The single version of the truth that WebFOCUS provides is already very useful throughout the company. We want to extend this to our suppliers and factories."

Traditional CPFR software requires parallel investments among suppliers and retailers up and down the supply chain. Partners need to purchase software and install it to link their operations – an expensive and time-consuming process. However, Pedott believes he can achieve much of this same functionality by using WebFOCUS to send dynamic, interactive reports to designated users.

"With WebFOCUS, we can send interactive reports with a payload of data, so external users can pull up inventory and sales information just as if they were using the dashboard in-house, and even control parameterization and sorting," he says.

Sometimes called accordion reports, these dynamic presentations can include thousands of records ­ a cost-effective alternative to deploying ad hoc reporting capabilities. Each report is expanded or contracted as needed, based on individual needs. With WebFOCUS ReportCaster, EMS could even send these dynamic reports automatically at regular intervals, so suppliers will always be kept up to date on the state of the retail operation.

It will take some stamina to achieve this level of automation, but Pedott believes the journey will be worth the effort. "WebFOCUS and iWay are supplying greater insight and enabling quicker response to events," he says. "Ultimately, it is our customers who benefit, since this technology allows us to deliver the items they need, when they need them."