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Big W Optimizes the Allocation of Its Seasonal Merchandise

Since Big W opened its doors in 1976, it has been committed to providing Australians with the highest quality merchandise at the lowest prices. A division of Woolworths Limited, Big W operates 181 stores across Australia, generating approximately AU$4.4 billion in sales annually.

Over the past few years, the retailer has experienced significant growth, making it more challenging to ensure that its seasonal merchandise was being delivered to the right store, in the right quantities, at the right time. Big W recognized that it needed to replace its 20-year-old allocation system — used to push 50 percent of its merchandise to its stores — with more sophisticated and advanced technology.

Big W sought a solution that would enable its planning assistants to allocate multiple product lines at once, while ensuring that it was delivering an ideal product mix to its stores as quickly and efficiently as possible in order to improve stock availability, reduce markdowns and increase sales.

Big W

Big W is one of the largest discount department stores in Australia, with 181 stores and 23,000 employees. It also offers more than 20,000 product lines via its e-commerce site and Big W mobile app. Big W is a division of Woolworths Limited, the largest retailer in Australia.

Objective

Improve its merchandise allocation process to ensure that the right product mix is delivered to the right store, at the right time.

Solution

Services

Real Results

  • Improved inventory turns and reduced stock-outs
  • Optimized store-specific product assortments
  • Increased planning assistants' productivity
  • Improved customer satisfaction

The retailer was already using JDA Software solutions to tackle merchandise financial planning and replenishment when it turned to JDA to address its allocation needs. “We had a strategic relationship with JDA,” said Roger Twigg, head of business improvement and support at Big W. “JDA Allocation met our requirements, and we knew we could implement it fast.”

JDA Allocation translates key consumer insights into optimized store-specific product assortments that can be deployed across the entire retail organization. Leveraging best-practice methodologies, JDA Allocation enables retailers to conduct what-if analyses to test allocation strategies prior to execution.

Big W decided to deploy the solution via JDA Cloud Services to reduce the implementation timeline, accelerate business benefits and reduce its hardware, maintenance and support costs. “The speed of implementation was important, as we had an issue that we needed to fix fast,” said Twigg. “We couldn't wait 18 months to get a new application up and running, and JDA's Cloud Services made it easy to deploy quickly.”

Leveraging JDA's cloud deployment service, JDA Cloud Perform optimizes the performance of the JDA Allocation application and infrastructure environment for Big W through hardware and software administration, capacity management and data integration, as well as manages areas such as problem resolution, change management and security.

Partnering With JDA Services

The JDA Services team provided the retailer with consultants to guide the implementation process and ensure that it had the right amount of hardware to support its needs. Big W adhered to the JDA Enterprise Methodology, JDA's proven global implementation approach, during the implementation process. “The model was similar to our governance and approach, so it worked well,” said Twigg. “We had good support from the JDA team on-site. We were able to implement JDA Allocation in nine months, ensuring that we met our timeline and our solution requirements.”

During the implementation process, JDA also conducted numerous workshops with Big W and worked jointly to identify and capture requirements and issues up front in order to avoid any costly rework later.

Improving Stock Availability

Prior to implementing JDA Allocation, Big W's allocation processes were labor-intensive. The retailer was not able to allocate family groupings by size or color. “We knew we had stores that responded similarly to seasonal and event-driven allocations, but we had to manage this information manually,” said Twigg. “For instance, if we knew a store was an exception to the rule, we would use a handwritten note to remind us the next time we did the allocation.”

Today, Big W's allocation processes are more streamlined. The retailer can now allocate families of products together by size and color, as well as group stores together in categories such as “holiday” stores. “JDA Allocation is very intuitive to use,” said Twigg. “Our planning assistants can now allocate a product family across five colors and sizes in one allocation. In our old system, this would have required 25 allocations. As a result, planning assistants now have more time to focus on improving the allocation process.”

While Big W is just in its first season of using the solution, it is already seeing benefits. “From a store perspective, the flow of stock has improved. Our backrooms are not as full, which means we don't need to re-work the stock as much. This is a positive result,” said Twigg. “While this also means our distribution centers are now very full, it is better to have the stock there than distributed throughout our 181 stores.”

In conjunction with JDA, the retailer also developed a way to use the solution to model how much stock to ship to each port based on like lines. This helps Big W ensure the accuracy of the stock flow up front, so that it doesn't send stock to stores that don't need it.

“As with all retailers, the main goal is to have the right stock in the right store at the right time. JDA Allocation is helping us ensure the availability of stock when our customers are shopping, while doing it in a cost-effective way,” said Twigg. “Our overall experience has been very good. We had a lot of strong support from the JDA team and from our team, which enabled us to implement the solution on time and within budget.”

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