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Neiman Marcus

Situation

For over a century Neiman Marcus has been a leader in the luxury retail business, providing its affluent clientele with apparel, accessories, jewelry, beauty products and decorative wares for the home. With over five dozen stores under various banners and close to 6.5 million square feet of store space, the retailer was faced with continuous growth while experiencing low vendor compliance and cost issues associated with its EDI initiative.

Business Challenge

Neiman Marcus was doing EDI on its own, using an internal mapping tool. IT resources were busy maintaining the environment and on-boarding new trading partners as they became approved vendors. This was taking a lot of effort and mobilizing IT resources away from priority projects on core business initiatives. Moreover, data synchronization was not providing the expected benefits. Low compliance combined with an inflexible catalogue offering by the previous vendor resulted in an EDI program that was not delivering the automation efficiencies that Neiman Marcus executives had counted on to reduce operating costs.

The firm was seeking a partner to eliminate some of the pain associated with its internally managed EDI program as well as an alternative data synchronization tool to address specific business process requirements. Candidates also had to be able to manage the on-boarding campaign associated with exchanging EDI documents, as well as the uploading of the product catalogue.

Solution Components

Neiman Marcus turned to InterTrade, at the time a relatively new player in the world of product data synchronization, to take over not only its vendor catalogue but also its entire EDI environment. InterTrade devised a set of components that met all of Neiman Marcus’s requirements, which included delivery prerequisites, network reliability and the flexibility to address complex systems integration to a pricing model that has since stood the test of time.

InterTrade was mandated to replicate Neiman Marcus’s EDI environment on its TradeLinks platform to connect all vendors for the exchange of business documents. Since the initial project, InterTrade has been connecting new Neiman Marcus vendors in a seamless way to reduce to a minimum the strain on internal resources. In the summer of 2007 InterTrade and Neiman Marcus also launched a campaign to transfer all vendors to the InterTrade catalogue. Vendors were allowed multiple ways of entering data on the catalogue, which facilitated the on-boarding process. Within a few months, Neiman Marcus’s target number of on-board vendors was surpassed in terms of compliance.

In 2012, Neiman Marcus decided to mandate the use of the electronic catalogue by all of their existing and new vendors.  Total compliance was achieved for over 1000 vendors by early 2013 with InterTrade’s on-boarding services.

Benefits

From a resource allocation perspective, Neiman Marcus has generated significant savings by trusting InterTrade with the coordination of its EDI business. Internal resources can now focus on business process, which speeds up the logistics around sourcing with EDI-capable vendors. InterTrade makes the process more efficient by taking over all aspects surrounding the exchange of documents. Moreover, the fact that the product catalogue is now with the same provider makes the whole experience more cost effective and certainly simpler from an overall IT strategy perspective. As per Jill Barron, Director of Supply Chain & Vendor Compliance at Neiman Marcus, "Moving to InterTrade substantially reduced our EDI expenses and allowed us to focus our IT resources on business issues."

Neiman Marcus was not the only party that benefited in this exercise. In fact, most vendors using the InterTrade catalogue love the features, the ease of use and the pricing scales, which allow all types of vendors, small to large, to post their Neiman Marcus product information at a fraction of what other similar services charge. Vendors using InterTrade’s ecCatalogue are actually prompting other retailers to connect so they can save money, benefit from better data management and provide accurate data to their customers.

More things to come

As the luxury retail segment grows, Neiman Marcus keeps expanding its business and needs to pursue further automation and reduce its overall cost structure. InterTrade will be instrumental in providing vendors with alternatives to connect through EDI. InterTrade will also deploy its catalogue tool to manage the product data information required by the various Neiman Marcus Group divisions to appropriately initiate their automated supply chain process. By trusting its EDI initiative to InterTrade, Neiman Marcus will leverage its initial investment in the catalogue and reap even more benefits as more vendors reach EDI program compliance.

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