Neck & Neck at a glance
Established in 1993, Neck & Neck is a leading Spanish kidswear brand that offers exclusive designs for newborns and children up to 14 years old. The brand offers high-quality products and styles for every occasion as well as school uniforms. Neck & Neck operates internationally in 17 countries.
Neck & Neck was expanding internationally, which was an exciting, yet challenging feat. As their distribution grew in scope and complexity, the brand identified several inefficiencies within its core operations which needed to evolve.
One challenge specific to the kidswear vertical is the increased complexity of having to offer many products in up to 13 sizes. Since Neck & Neck has more than 500 references per season, the sheer number of combinations of references, sizes, locations, and events were extremely complicated for the brand to manage, let alone carry out sophisticated calculations.
The tools and methods that Neck & Neck had previously relied on no longer met the requirements of the growing complexity of their offering. While they worked well when the brand only had a few locations to manage, manual legacy tools and methods now ate away at the precious time of teams, and they still only provided an oversimplified vision of reality.
Since these tools made it hard, if not impossible, for the brand to achieve the granular, unified visibility of stock they needed, product replenishments were often inaccurate, leading to overstock.
Neck & Neck had to make replenishment decisions based on the overall past sales performance of stores. Simply put, stores that achieved better overall sales numbers received more products. The problem was, Neck & Neck couldn’t factor in future demand at category or product level.
As a consequence, Neck & Neck had to offer deep discounts at the end of the season because of initial overallocation and later, an inability to dynamically reallocate excess stock.
Neck & Neck decided it was time to invest in a solution that would ultimately help them reduce excess stock and boost full price sales.
Neck & Neck and Nextail
Neck & Neck began working with Nextail in 2017, implementing the Replenishment and Store Transfers modules.
With Nextail, Neck & Neck managed to have full visibility of all stock at SKU level over several locations. Since the brand now had the ability to quickly collect and process product data, Neck & Neck could correctly distribute stock to the right stores, and consequently reduce the amount they’d have to offer at a discount.
Today, Nextail’s demand forecast continues to help Neck & Neck anticipate changes in demand at a local level, factoring things like promotions, store-level size curve, and sales they were potentially losing due to stockouts.
Another area in which Neck & Neck now excels is in redistribution through store transfers. In the past, the cost of transferring products outweighed the returns, especially when it was nearly impossible to know what impact the transfers would have. Thus, Neck & Neck only executed store transfers during sales periods when it could be done in bulk without much precision.
Today, Nextail helps Neck & Neck carry out tactical, optimized product movements, also between physical and online stores, creating a real opportunity to sell at full price.
- Since Neck & Neck was able to better replenish products and optimize store transfers, the brand increased sales of products with low rotation and reached their season sellout goals before pre-sales and Christmas sales on in-season products, far exceeding the previous year’s results.
- Neck & Neck was able to reduce in-store coverage by 40%
- With the ability to monitor stockouts to avoid lost sales, real stockouts dropped below 5% throughout the whole Winter 2018 season with Nextail.
Neck & Neck’s sales actually increased while the brand reduced stock levels, and it was able to reposition itself within the high-end fashion sector. This was all thanks to better distribution of their product, enabling tactical scarcity both in stores and the warehouse.
Neck & Neck chose Nextail for several reasons. On the one hand, the goal of Nextail is to help retailers like Neck & Neck meet the exact goals the brand was aiming for: to reduce overstocks through data-driven replenishment decisions.
On the other hand, since Nextail was developed especially for the unique needs only found in the fashion industry, it is fully capable of handling vertical-specific complexities of kidswear.
And Since integrations of Nextail are light-weight, Neck & Neck was able to quickly see the impact it had on its business in just a matter of weeks.
*All results from FW2018, approximately 40 weeks.