Hospital based fashion retailer targets healthy growth

Beginning life in 1988 as a single, table-top trader in Addenbrooke’s Hospital near Cambridge, TheStockShop has grown to become the leading niche fashion retailer operating within NHS Trusts throughout the UK. It offers a defined product range selling clothes, accessories, fashion and gift items not often found on the High Street. About 40% of sales come from NHS staff (Addenbrooke’s employs 12,000 people) with the remaining made up of in-patients, out-patients and visitors. The business currently has 26 outlets and is run from a central office function of just 16 people and a warehouse facility in Ely, Cambridgeshire, employing five.

TheStockShop intends to continue expanding at an approximate rate of two outlets per year, measured growth reflecting the niche nature of its location. The challenge for the business was how to maintain such growth while controlling operating costs associated with management and especially distribution and stock handling functions.

Using Microsoft Dynamics NAV implemented by K3 together with K3’s Pebblestone fashion specific module, TheStockShop has transformed its supply chain to a model of excellence. As well as increasing sales in existing stores, the business now benefits from a future-proof and extensible Enterprise Resource Planning solution that provides a platform for business growth. Mark Mitzman, Operations Director for TheStockShop, describes the solution as “phenomenal”, recognising that the business now has better access to management information and a responsive, streamlined supply chain needed to efficiently manage a steady growth programme.

Agile supply chain management for better retailing

TheStockShop understood that to in order to fulfil this growth strategy it needed a better system for managing store inventory, ordering and distribution, as well as improved point-of-sale automation. Previously TheStockShop used Sage Line 50 and ePOS solution Top to Toe but the two systems struggled to meet the demands of the growing business. As Mark explains, “Before NAV, we used to manually allocate stock and because of the time this took we were only able to deliver to our stores twice a week.”

TheStockShop needed an “all in one” solution and having spoken to a number of Microsoft resellers it chose Microsoft Dynamics NAV. As well as managing and upgrading the solution, K3 has implemented K3 Pebblestone Fashion. This module is designed specifically for fashion businesses, and handles all of the essential pre-sales to supply business processes including sourcing, purchasing, logistics, warehousing and financial administration. It enhances the core functionality, features and capabilities of Microsoft Dynamics NAV to provide a single, easy to use and fully integrated solution for fashion retailers such as TheStockShop.

Stock distribution is now fully automated in Microsoft Dynamics NAV with all the product variables handled by K3 Pebblestone Fashion. Mark adds, “Using NAV we have moved to an automatic distribution system and now send out deliveries every day to our stores. This has enabled us to reduce the stock holding in our stores and allows us to more rapidly respond to demand.

“We can now pinpoint which product/store combinations need to have their levels increased without looking through all levels. We can also now get a list of unallocated stock, including being able to look at which styles have not been sent to a particular store, so eliminating human error.”

TheStockShop uses an ePOS solution in its 26 stores integrated with Microsoft Dynamics NAV that has made the retail operation quicker and more responsive, as Mark explains. “NAV has enabled us to streamline our customer requisitions process and deliver sales and stock information to the stores so that the store managers can see their progress against our budgets. Moving to a newer technology platform also improved the time needed to serve an individual customer – it’s now much faster to process the transaction through the till and card machine.”

“Before NAV, we used to manually allocate stock and because of the time this took we were only able to deliver to our stores twice a week”

Make better decisions with improved business intelligence

Because the solution brings business data together and makes it available to relevant users, TheStockshop is better placed to manage the business from its small head office team and realise growth more efficiently in terms of both sales and outlet numbers.

For instance, budgets have been moved inside Microsoft Dynamics NAV so the need for double-data entry via spreadsheets has been removed. Using ZetaDocs from K3 partner Equisys, time-consuming and error-prone manual (paper) filing and handling of invoices, proof of delivery notes and other notifications has been replaced by batching them together inside Microsoft Dynamics NAV to improve record keeping and query handling.

Timely access to and better handling of management information means that TheStockShop can take advantage of improved business intelligence for more accurate reporting and forecasting, as Mark explains. “We used to spend a lot of time simply preparing the reports. Where we were previously juggling spreadsheets, the reporting power is now phenomenal. Generating reports is a lot quicker and because it’s now possible to customise them so that we have the data we want instead of having to perform additional calculations based on the reports, we can spend more time analysing sales and making better business decisions.”

Primed for growth thanks to Microsoft NAV and K3 Pebblestone Fashion

A better supply chain combined with improved data handling and enhanced business intelligence has already led to sales increases and primed TheStockShop for future growth.

According to Mark, “Better stock management and distribution has certainly increased our sales, even though it’s difficult to pinpoint by how much. Replenishment goes to the correct stores compared to the old system, wherein higher levels meant that some stock could end up stuck somewhere it wasn’t selling.

“Equally, now when we add a new store to the business the impact on the time spent distributing is negligible. Previously we manually allocated stock prior to each distribution so adding a store added a fixed amount of time. With automated distribution in NAV we set initial levels for a store, so all future distribution doesn’t need any personnel time. We have probably saved around 10 man hours per week since adding this feature.”

With Microsoft Dynamics NAV and K3 Pebblestone Fashion bringing together improved business management and a refined, more automated distribution system, it’s clear that TheStockShop is better equipped to manage its growth strategy using existing resources and infrastructure.

“NAV has enabled us to streamline our customer requisitions”