VGO Corporation Limited leverages on an IT game plan to stay on top

Pushing the boundaries

From humble beginnings as a men’s shoe manufacturer to a regional retail giant, there were no short cuts in the development of VGO Corporation Limited. Instead, it was the perseverance of three brothers (George, Joe and Steven Goh – Executive Directors of VGO Corporation Limited) to constantly push the parameters of the business to a higher platform.

In 1991, as a fitness craze started to sweep across the globe, the company saw huge market potential and an opportunity to enter the retail market with a general sporting goods store. It opened its first World Of Sports retail store in Singapore and the brand quickly grew to become a household name for sports and one of the largest retailers of sporting and active lifestyle brands in the region.

Today, VGO is the leading marketer and retailer of internationally renowned sports brand names. It boasts exclusive distributorship rights of over 25 sports brands and operates an international retail (over 50 stores) and distribution network that stretches across Singapore, Brunei, Malaysia, Indonesia and Vietnam. While sports remains the cornerstone of the Group’s business, VGO continues to look for more growth opportunities and has recently embarked on a new frontier – the opening of its new Bread & Butter boutiques in Singapore in 2007 marks its entrance into the lifestyle and luxury fashion retail arena.

Staying ahead of the competition

According to Chief Operating Officer, VGO Corporation Limited, Ms Jasmine Tan, the sports, lifestyle and luxury retail industry is highly competitive, with demand largely dependent on consumer spending patterns that can swing drastically, especially in the current economic climate.

Intense competition and quickchanging consumer tastes have led to volatile sales. “In such an unpredictable environment, operational efficiency is of great importance to us,” Ms Tan explained. “Furthermore, we have an added challenge as cost of operations, such as rental overheads, continue to rise. So it is crucial that we monitor our expenditure closely and exercise tight controls to reduce operating expenses and improve operational efficiency.”

“We were not able to get information on which outlet was low on stock for a particular product and at times the information simply took too long to get to us at the headquarters to trigger quick replenishment,” Ms Tan added.

Changing the game

In order to transform into a more proactive and agile retailer, VGO enlisted the help of Solution Details, an IBM Business Partner, to overhaul its manual processes and implement an end-to-end enterprise resource planning (ERP) system.

Solution Details implemented Konverge ERP, designed to help small and medium retail businesses simplify, digitize and automate finance, sales and back-end distribution processes on highly scalable and robust IBM System p and System x servers. With the new IBM infrastructure, VGO is able to leverage on industry renowned reliability and around-the-clock availability to transform into a dynamic and versatile retailer.

This was integrated seamlessly with Konverge POS, a point-of-sales software solution designed for fast-paced, high-volume, multisite retail operations, allowing VGO to synchronize real-time sales and inventory data with the ERP system back at its headquarters. Konverge POS was installed at all 38 retail outlets (spanning its World Of Sports, Sporting concept as well as Lifestyle and Luxury stores) in Singapore.

“The team from Solution Details really delivered on their promises and gave us good advice, service and support throughout the process,” Ms Tan commended. “It is also good to know that both Solution Details and IBM are able to provide onsite support at our retail outlets island-wide. So if there’s any trouble with the system, regardless of location, we can be sure that it will be resolved quickly.”

“The new system has helped to improve our operational efficiency by as much as 40 percent. Sales information from each outlet is fed into the central system immediately and our inventory is automatically updated. The resilient IBM infrastructure also ensures we don’t miss out on any sales opportunities.” – Ms Jasmine Tan, Chief Operating Officer, VGO Corporation Limited

Better visibility, faster operations

With the new Konverge ERP and POS systems, VGO is now able to control its inventory and stocks across all outlets in real-time from its headquarters. In addition, purchase orders from all outlets are now consolidated into a single request.

“The new system has helped to improve our operational efficiency by as much as 40 percent. Sales information from each outlet is fed into the central system immediately and our inventory is automatically updated,” Ms Tan described. “This real-time information allows us to be more proactive and responsive to everchanging consumer trends.”

According to Ms Tan, the company is also able to implement more targeted marketing plans with the real-time information available. It is also easier to create and track promotional bundles as Konverge POS readily handles multiple promotions across price, item and quantity.

In addition, with the IBM System p and System x servers at the heart of the new system, VGO is well equipped to continue to push the boundaries of innovation even further. The infrastructure is more flexible, allowing VGO to quickly adapt applications and products to changing customer needs. “The energy saving feature of the IBM hardware was an added plus,” noted Ms Tan. The System x servers not only allows for greater performance per watt, but also helps VGO keep operating costs down.

Helping customers win

The ability of the new POS system to support its loyalty program was another important benefit. Today, the system automatically captures membership details and updates membership points right at the point of sales. “This allows members to make a purchase at one outlet and redeem their loyalty points at another outlet half an hour later,” Ms Tan explained.

Overall, the new systems have helped VGO deliver faster, more responsive services to its customers. “At the end of the day, it is our customers who win, and that’s the true benefit,” she concluded.