Explore Richemont’s journey with SAP
Richemont International SA works with more than 700 direct spend suppliers to create the highest-quality luxury goods. But manual procurement was limiting supply chain visibility. With SAP Business Network and SAP Business Network for Supply Chain, Richemont has the insight to ensure compliance and ethically sourced materials.
|Consumer products||Geneva, Switzerland||>35,000 employees|
- 82% of purchase orders flowing through SAP Business Network.
- Up to 50% reduction in employee effort for warehouse receiving.
- 12-day decrease in confirmation feedback cycle (from 17 to 5 days).
SAP Business Network for Supply Chain is not a one-way tool. It allows us to fully collaborate with suppliers – including directly through their ERP system. – François-Xavier Botta, IT Procurement Solution Architect and Technology Lead, Richemont International SA
Harmonizing supply chains through digital supply chain collaboration
As the owner of 27 luxury brands and more than 2,300 stores, Richemont works with more than 700 direct spend suppliers to procure everything from materials to manufacturing services. But manual, e-mail-based workflows and an outdated supplier collaboration system made it difficult to organize and connect with suppliers and resulted in a lack of insight.
Richemont’s goal was to improve supplier collaboration by making the production process, including warehouse management, more efficient – both internally and for external partners. From a performance perspective, this would require accelerating workflows, improving data quality and reliability, and simplifying the procure-to-pay process.
Richemont also prides itself in complying with the highest industry standards for sustainable, ethically sourced materials – working only with suppliers that treat workers and the environment with respect.
Ensuring the best relationships with the right suppliers requires harmonized procurement processes across group companies, instantaneous interactions with suppliers, and real-time supply chain visibility. To get there, Richemont needed a complete digital supply chain management transformation.
Before, we had no supply chain visibility. With SAP Business Network for Supply Chain, it’s like day and night. We have insight into supply chain operations, suppliers are happier, and we have more time for value-adding tasks. – Mirjana Maillard, Procurement Product Owner – Cartier, Richemont International SA
Digitally transforming the supply chain to boost visibility and efficiency
Richemont chose to digitally transform its external manufacturing supply chain using SAP Business Network and SAP Business Network for Supply Chain.
The initial pilot was to enable digital procurement for six “Maisons,” covering 10 direct suppliers and 100 level-one supply chain processes across procurement, outsource manufacturing, external processing, and returns. Working with the SAP Ariba solutions team, Richemont followed the SAP Activate methodology. The project then expanded to nearly 460 direct suppliers, with 17 of those connecting SAP Business Network to their own internal ERP systems.
Not only did the project involve business, technical, and onboarding workstreams, it also included careful training and change management efforts for business users and suppliers alike. As the rollout continues, the ultimate goal is to onboard all new suppliers, including 30 integrated suppliers.
Gaining the insight to ensure sustainable and ethical global procurement
Richemont now has nearly 460 direct supplier users on SAP Business Network, with plans to add more as part of its continuous process. Digitalized workflows are accelerating procurement operations overall, including inbound delivery processing. Plus, the company has instant visibility into every transaction, from POs to shipping, to returns.
Working with suppliers has never been easier or more efficient. In-application messaging is eliminating e-mails so that communication is in context and does not get lost. Richemont engineering teams can also share the latest design documents quickly, helping speed turnaround time and minimize errors. And for larger suppliers, integration with their own ERP systems helps greatly reduce the administrative burden of processing high volumes of orders.
Richemont’s suppliers are happy with SAP Business Network, reporting user satisfaction and the ability to get used to the new system quickly. Integrated suppliers are also reporting faster order processing, thanks to the elimination of manual order entries.
Ultimately, the project is just one step in a complete spend journey, which also presents an opportunity for each “Maison” to harmonize procurement processes as well.
Growing the supply chain network while increasing insight and efficiency
As Richemont continues to roll out SAP Business Network to more suppliers, it is approaching onboarding as a continuous project.
It is considering adding more SAP Ariba solutions, including the SAP Ariba Invoice Management and SAP Ariba Buying solutions.
The company plans to use additional functionality in SAP Business Network for Supply Chain to give suppliers immediate access to technical drawings. It will also help ensure materials are of the highest quality and ethically sourced using sustainable, conflict-free methods.