California Apparel News

Laguna Hills, Calif.–based software developer Innovative Systems LLC has cornered the action-sports market in Orange County, having supplied a who’s who of surf/skate brands with their IT needs. But with a new PLM module in hand, the company has recently expanded well beyond the beach, signing on a host of fashion brands including Juicy Couture, LRG, Lucky Brand, Ya Ya, Dickies Girl, Rock & Republic, William Rast and Splendid/Ella Moss.

Innovative Systems develops and markets Full Circle ERP software and runs EDI Direct, an electronic data interchange mapping service that helps companies ship to department stores and large retailers. The systems help to manage all aspects of apparel production from concept to delivery.

The company’s strength in the surf/skate market comes from partner Joseph R. Schaefer’s roots in the surf industry, where he helped grow brands such as Catch It and Beach Patrol during the ’80s, when the action-sports industry was in its infancy. In those days, he remembers, companies such as Billabong USA had difficultly fielding a team for the annual industry softball tournament.

As the software company has matured, non-surf brands are finding that Full Circle runs just as well in the fashion market. The company specializes in working with small- to mid-tier-level companies, generally those with revenues from $20 million and up. Growth within that sector has been strong, with sales up about 23 percent for the year.

The strong uptick surprised even Schaefer, who admitted he was bracing for a flattening of business.

“I’ve never seen it so active. Since the beginning of the year, we’ve had at least one major deal every month,” he said.

The company’s growth could be linked to several factors, the main one being that the system has a strong track record and provides a smooth working environment, Schaefer explained. Most of the company’s new accounts come through word-of-mouth referrals.

Toby Bost, chief executive officer of Irvine, Calif.–based O’Neill Clothing/La Jolla Group, is among those supporters of Full Circle.

“Five years ago, when La Jolla Group signed with Innovative Systems to implement Full Circle, we were growing at a rapid pace, we were fed up with the limitations of the AS400 and needed an organic ERP provider that understood the apparel business. In the last five years, we have added more than $100 million in sales, integrated four new companies and have hundreds of users on the system daily. I’d say that speaks volumes for what they delivered and just how integral the software has become as the backbone of our operations,” Bost said.

The Full Circle system is written in one language and built on one platform and server, putting all customers and service staff on the same page. Schaefer said hardware costs are minimal because the workstations emulate the server.

“When I do demos, the responses I get are that customers and prospective customers like the flow of our software. It’s intuitive,” he said.

In addition, all the applications are integrated so transitions between applications are smooth and do not require any duplicate data processing.

Like its name implies, the Full Circle system covers all processes from concept to distribution. Functions include master-file tables, style cost sheets, production and sales forecasting, order procession, real-time sales rep order processing, allocation, scan and pack, warehousing, invoicing, credit processing, material-inventory tracking, and factor interfacing.

The financial module covers accounts receivables/payables, statements, chargebacks, letters-of-credit tracing and multi-currency costing.

The company’s EDI direct business has grown to more than 200 customers and now accounts for about 40 percent of the company’s overall business. Like Full Circle, the company’s EDI service is simplified. It is based on a transaction mapping system that converts everything to one standard order, allowing technicians to step in at any time.

The company has and always will cater only to the apparel and soft-goods industries, Schaefer said. “We don’t want to vary from that,” he said.

New Chargebacks Software at Limited

Columbus, Ohio–based The Limited has signed a contract with Irvine, Calif.–based The Retail Equation to use its Verify 1 returns-and-exchanges monitoring system throughout its chain.

The Limited was spun off by parent Limited Brands last year, which created two divisions, Limited and Express. Limited Brands was left with Victoria’s Secret, Henri Bendel, Bath & Body Works, La Senza and others. The Limited is now operating on its own with 240-plus apparel stores.

Following the spin-off, the company signed a direct contract with The Retail Equation. The Verify 1 system helps prevent fraud and abuse during customer returns through proprietary software, which employs statistical modeling and analytics technology. This enables managers to track any discrepancies and unusual occurrences and act on them throughout their store network.

The system has resulted in reduction of returns of about 13 percent, which adds up to thousands of dollars in savings. Returns account for about $15.5 billion in lost revenue each year for retailers.

For more information, visit www.theretailequation.com.