Salvatore Ferragamo Puts Its Best Foot Forward With SAP

February 14, 2011 by SAP News 0

Luxury Goods Retailer Turns to SAP® Solutions to Standardize Global Business Processes on a Single Platform, Drive Growth and Achieve Transparency Across Operations

FLORENCE, ItalyItalian luxury-goods maker Salvatore Ferragamo is in the fortunate position of facing increased demand for its products, particularly in Asia-Pacific. However, existing IT systems – primarily designed for limited local business – are struggling to support this level of regional growth. In order to meet customer demand and position itself for further expansion, Ferragamo selected business software from SAP AG (NYSE: SAP) to bring cohesion to the company’s information technology landscape. Ferragamo aims to streamline its global business processes over the company’s entire value chain, from back-office functions such as financials to the point of sales in its retail stores. The new system will enable Ferragamo to gain the insight to better understand its customers and business, the operational efficiency to drive profits and the adaptability to capitalize on the best opportunities to grow.

Founded in Florence in 1927, Ferragamo has extended its retail presence across Europe, North America and Asia with approximately 2,600 employees and more than 550 stores. Recently, the company’s strongest growth has been in emerging markets in Asia, which now represent more than 50 percent of the its annual turnover. Ferragamo opened 10 new boutiques in China in 2010, bringing the total number of stores across China to 45. The company was faced with the substantial challenge of creating standardized management processes for these new locations and bringing them in line with global operations. For example, without the proper insight and control, an unforeseen inconsistency in the supply chain could cause retail stores to run out of a popular item. By harmonizing its global business processes on one integrated IT platform from SAP, Salvatore Ferragamo obtains a single source of truth, with consistent data across all business operations, from the supplier to the customer in the store. This will help the luxury goods maker to consistently make business decisions based on the latest and most accurate information, thus helping ensure that the right product is available at the right time and offered via multiple channels, where the need is greatest.

“In the highly competitive marketplace of international luxury goods, we are determined to distinguish ourselves with an unfailing commitment to quality and service,” said Michele Norsa, CEO, Salvatore Ferragamo. “To meet that commitment, we must have complete and dependable insight across all our business processes, from our headquarters in Italy to our boutique shops in China. SAP is a global information technology provider able to meet our needs for seamless functional capabilities, centralized architecture and multinational support. This implementation will provide us with one standardized system that brings cohesion to our global operations, and helps us ensure we continue to meet the high quality of service our customers have come to expect.”

Software from the SAP® for Retail solution portfolio will help transform Ferragamo’s existing IT landscape, providing centralized control for stock management and distribution – from stand-alone shops to goods available for purchase online. The SAP NetWeaver® Process Integration offering will help the company connect its legacy systems with the new SAP solutions, allowing for a reliable exchange of processes and information across distributed business applications and geographies. The SAP NetWeaver® Business Warehouse component will create a consistent database of information, offering Ferragamo complete transparency to enable better business decisions. These implementations will serve as the foundation of an enterprise-wide coherent business strategy for Ferragamo, providing the company with a governance model that can be used to rapidly and seamlessly enter new geographic markets as needed.

The first go-live of the new SAP system successfully took place on schedule in January 2011 at Ferragamo corporate offices in Hong Kong, and will be followed by retail stores in Hong Kong and Macau by the end of June 2011. Operations in Taiwan and in China are scheduled to go live by the end of the year.

“With a global and technology-savvy customer base, international retailers such as Ferragamo are under significant pressure to deliver a quality experience to both in-store and online shoppers,” said Agostino Santoni, managing director, SAP Italy. “Only with real-time global visibility and subsequent alignment of internal operations can they meet these expectations. With the new solutions from SAP – from inventory management to data warehousing – Ferragamo will simply run better, faster and smarter. This successful first implementation in Hong Kong sets the stage for a global rollout, one that will support the Ferragamo brand across new and existing markets.”

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