The Definitive Guide to SAP S/4HANA® for Fashion and Vertical Business
SAP has put real-time business within reach of fashion retailers with the introduction of SAP S/4HANA for Fashion and Vertical Business.
This next-generation platform combines the lightning-fast analytics of SAP HANA with transactions, enabling fashion retailers to gather and process data across wholesale, retail and manufacturing, while simultaneously applying it to consecutive business process – all in real time.
Below, we’ll go over many SAP S4HANA Fashion use cases so to give you a clearer picture of how incorporating a real-time digital core for fashion is the best way forward.
Here’s your roadmap for the rest of this guide. As we move along, we’ll stop off at each point to dig in a bit deeper.
Roadmap to the Definitive Guide to SAP S/4HANA for Fashion and Vertical Business
- How does SAP S/4HANA deliver a digital core required for the digital economy?
- What does SAP S/4HANA Fashion mean for apparel, fashion and footwear companies?
- Why move to S/4HANA Fashion: Scope, Functionality and Benefits?
- What are the use cases of SAP S/4HANA for Fashion?
- What considerations are there for migrating to SAP S/4HANA Fashion Retail?
- How can companies migrating to SAP S/4HANA Fashion faster?
- Manage S/4HANA Risks with a Future Reference Solution
- An SAP VP answers some SAP S/4HANA for Fashion FAQs
- Why act now?
1. SAP S/4HANA: Delivers a Digital Core for the Fashion Industry
Business now understand that overly-complex business operations and IT systems cause considerable limitations in business performance.
Furthermore, according to SAP:
- 70% of the effort in an analytics project is in preparing the data
- 67% of retail executives say employee satisfaction has been harmed due to the cost of complexity
- 10.2% of profits are lost by the top 200 global companies due to hidden costs of complexity
However, overcoming complexity in fashion is not a “to-do” item that can easily be checked off. Rather, it involves a strategic company-wide approach with a singular goal: drive digital transformation in fashion by leveraging a robust digital foundation that places simplicity at the core of the business.
Differentiate Through Data
Information is one of the most valuable assets of a fashion business. Data management and analysis of data can set a business apart from its competitors.
But information and analytics go even deeper when all data can be gathered, processed, and interpreted with speed and agility. It’s most powerful when it’s in direct relation to business processes.
Transformation Requires A Digital Core
Ask a CIO which technologies a company must have to “digitally transform” the organization, and you’ll probably hear about internet of things (IoT) or machine learning. But these technologies can’t work their best on traditional, monolithic IT landscape or legacy ERP data structures.
This is where a digital core comes in. A digital core is crucial to a digital transformation initiative offering stability and long-term reliability for core enterprise processes with a single source of truth. This solid foundation gives you a higher degree of flexibility to adapt and innovate quickly to new opportunities and challenges, such as new business models, new regulations and business events such as mergers or acquisitions.
A digital core brings together transactional processes and analytics on a single platform to deliver real-time intelligence with immediate, tangible benefits.
For fashion companies, this means using a platform that connects across all sales channels – wholesale, retail, manufacturing and e-commerce, empowering decision-making and giving you a significant advantage in today’s digital economy.
Today, the most successful retailers are using a digital core to centralize data and establish a single source of truth with an enterprise-wide digital transformation initiative as seen below:
Digital Core Updates Are Significant
However, moving to digitally-connected core is not a small, incremental change. Enterprises that treat it as such will fail to succeed.
Building a digital business brings about fundamental changes, with new business models that involve major shifts in how an enterprise operates and interacts. The key to thrive and survive in the digital era is managing data, but this can’t be sustained efficiently without a revamped digital core that includes stable and reliable core ERP processes.
SAP S/4HANA Delivers
SAP S/4HANA delivers on this promise by creating a functioning digitalization-friendly IT environment. Within this landscape, all its applications are interconnected, making it possible to access and use detailed data from anywhere within the company in real time without information loss.
How does a digital core on SAP S/4HANA with a true single source of truth help?
- Speed: Perform real-time planning, execution, reporting, and analytics based on live data
- Agility: Access real-time business insights on any device, anytime, anywhere
- Simplicity: Deal with both transactional and analytical workloads simplifying your IT landscape
- Cost efficiency: Reduce TCO by combining analytics and transactions
- Innovation: Find new growth opportunities by rethinking business processes and enabling the business platform for mobile devices
2. Introduction to SAP S/4HANA for Fashion and Vertical Business
Now that you know that large, monolithic ERP suites are not conducive to the agility required for digital business, let’s take a closer look at what SAP S/4HANA for Fashion is. We’ll show how it delivers a digital core to power operations, modernize the operational core, and help retailers meet the demands of omnichannel retailing.
What is SAP S/4HANA for Fashion and Vertical Business?
SAP S/4HANA Fashion is a comprehensive ERP solution, designed to help fashion businesses meet the demands of the digital economy.
With a simple and intuitive interface, it provides fashion companies access to every aspect of their business, merging all fashion processes –wholesale, retail, manufacturing and e-commerce – into a single platform. The vertical fashion platform gives retailers the flexibility and agility needed to deliver seamless customer experiences.
Real-time Reporting
Retailers can use it easily adjust to rapidly changing business requirements and report in real time by:
- Function
- Region
- Category
- Channel
- Product
Designed to place real-time business within reach of fashion companies, SAP S/4HANA Fashion combats complexity, streamlines digital transformation, and provides the ultimate simplicity.
Supports Reinvention
Supporting fashion core processes end-to-end, from master data to supply assignment, the redesigned business suite provides previously unavailable agility and flexibility designed to support innovative digital business initiatives.
Fashion companies are able to reinvent their business from front office to back office, gain insights into operational data, and empower their employees with contextual, real-time information for faster and better decision-making. 
What does SAP S/4HANA mean for fashion businesses?
Businesses are able to interpret information flowing in and out of the business. They can take their processes digital based on a single source of information that interconnects all aspects of the value chain in real-time.
Supports Seasonality
Many companies sell products according to the season. Their main objective is to avoid having stock left-over at the end of the season.
From planning, procurement, sales, online and offline channels through to coordinated clearance sale campaigns, vertical integration on SAP S/4HANA for Fashion ensures that these processes are fully harmonized, whether the products are being sold in a department store or in a flagship store.
In-Memory Nerve Center
This entirely new business suite runs on the SAP HANA in-memory database technology to give end users real-time decision support. It moves away from the transactional ERP system and becomes the nerve center (digital core) of your entire fashion enterprise.
- Developed natively on the SAP HANA® platform for real-time data processing and analytics, coupled with best practice fashion functionality for a live understanding of customers, inventory, and sales
- Offers global inventory visibility, common sourcing, buying, and manufacturing with capabilities for stock segmentation across channels
- Delivers omnichannel supply assignment and fulfillment based on real-time sales and inventory information to keep up with customers’ expectations across sales channels
- “Industry to core” means one platform that unites various industry solutions for potential synergies and cross-scenarios
- Single set of master data that simplifies processes in key areas such as inventory management and stock valuation with no more batch processing required.
- Easily connects to people, devices, and business networks to deliver new value to their customers on any channel, which means the Internet of Things and Big Data become accessible to any business
- Create a truly live business with immediate insights to act in the moment and intelligent processes that go beyond automation to predictive suggestion and complete integration between your departments and verticals
- Gain any insight on data from anywhere in real-time to plan, execute, predict, and simulate with all decisions able to be made on the fly with the most granular data for faster business impact.
- Dramatically simplify the landscape and reduce TCO
- Use a simple and role-based user experience based on modern design principles across all functional areas, allowing new ways of working for business users, minimizing training efforts and increasing productivity.
Simplified User Experience
The value from a SAP S/4HANA Fashion Digital Core is delivered through the simplification of the user experience, architecture, and business processes. This helps retailers better analyze trends, simulate the outcomes of strategic options, and optimize planning. Fashion companies now have the ability to create unique opportunities to reinvent business models and drive new revenues and profits.
Agile and Robust
We are seeing a mass exodus from monolithic, legacy platforms to a more agile and robust one like SAP S/4HANA; a purpose built system for the digital age.
The movement is happening across the globe, from European mega brands to Latin American startup e-tailers looking to expand globally.
Move away from fragmented or home-grown, custom solutions in favor of SAP S/4HANA for Fashion because:
- It’s more complex to build and deploy a custom application suite than to implement standardized ERP platform such as SAP S/4HANA for Fashion
- Large scale internal development projects typically take longer to deliver value to the business, whereas rapid deployment solutions built for SAP S/4HANA for Fashion accelerates the implementation timeline with a preconfigured template
- It’s difficult to update and extend the custom application to respond to market trends, customer expectations, management requests, and changes in technology. SAP S/4HANA for Fashion uses the latest technologies to connect your workforce, suppliers, consumers and the internet of things in real-time to capture every opportunity and customer demand signal
Quick Wins
Fashion brands are now scoring quick wins within a broader, enterprise-wide program that uses rapid deployments and a highly user-friendly design, such as SAP S/4HANA.
To better understand the benefits, we break down how SAP S/4HANA Fashion addresses common pain-points faced by fashion companies below.
3. Why Move to S/4HANA Fashion: Scope, Functionality and Benefits
Fashion companies must be ready to service their customers at any given moment with:
- The right information
- The right product
- In the right location
- At the right price
The capabilities delivered with SAP S/4HANA for Fashion and Vertical Business and its many integration points into complementing retail solutions help ensure fashion companies deliver on this promise across the customer engagement lifecycle.
Let’s take a look at how this is possible with an overview of SAP S/4HANA benefits, functionalities and scope.
Duplication of Effort / Lack of Integration |
|
|---|---|
| Paint Points | Solution on SAP S/4HANA |
| Different data models, data dictionaries, different languages, and duplicate data drives lowers reliability of any given data set. | Work with larger data sets in one system, merging retail, manufacturing, and wholesale data in a single ERP with tight integration to related systems such as CRM, PLM, etc. |
| Different data models, data dictionaries, different languages, and duplicate data drives lowers reliability of any given data set. | Removes data discrepancies, reduces data footprint, and eliminates redundant data entry/processing tasks, drastically lowering data manipulation errors. |
| Data latency results in wider margins of error, delays, and bottlenecks - like inability to replenish stocks fast enough to meet real-time demand across channels. | Enterprise-wide access to a single source of truth for decision-making in real-time. |
Inventory Management |
|
|---|---|
| Paint Points | Solution on SAP S/4HANA |
| Stock information is spread across numerous tables, channels, and locations. It's difficult to consolidate slow, non-transparent processes that require manual work or cumbersome interactions between applications. | Inventory information is stored in general journal tables for simple and live stock reporting. |
| Stock is available for consumption across all locations regardless of priorities. | With stock protection, companies can reserve stock for high-priority channels. |
| Mission-critical core processes such as allocation or calculating available-to-promise quantities can only be run at night. | Allocation processes (supply assignment) and ATP runs are accelerated by using in-memory computing technology. |
Manual/Non-Systemic Processing |
|
|---|---|
| Paint Points | Solution on SAP S/4HANA |
| Manual workarounds are often needed in an attempt to merge key data to conduct daily work. | Fact-based, timely decision-making with accurate data available without replication or delay. |
| Merchandising decisions often based on intuition rather than accurate data. | Improved system capabilities reduce the need for external systems. |
| Data issues, latency, inconsistencies, or problems feeding information across systems results in rework, reprocessing, or overrides. | Limited workarounds or system customizations. Use of supported extensions for non-standard functionality. |
Season Management |
|
|---|---|
| Paint Points | Solution on SAP S/4HANA |
| Master data management does not consider seasonal windows. | New seasonality concepts drive all processes of an article along its lifecycle from master-data creation to sales. |
| Provides limited support for seasonal handling, informed decision-making, or analysis of what products or styles perform best. | Distribution curves help fashion and seasonal businesses achieve the right mix of styles to maximize revenue opportunity. |
| Control logistical processes like sales and purchasing based on seasonal parameters. | |
Supply Chain Planning |
|
|---|---|
| Paint Points | Solution on SAP S/4HANA |
| Separate planning for individual channels. | Single system for planning and allocation with a joint purchasing process that handles higher order quantities under better ordering conditions with the suppliers. |
| Long and overnight batch run processes and lack of overall inventory visibility results in inefficient planning and permanent latency in inventory turnover reporting. | Unified demand insights and forecasts across functional areas. |
| Inflexibility to include real-time changing demands in the planning run leads to outdated and inaccurate planning. | Increased flexibility in stock usage like shifting leftover stock between channels when necessary, reduces out of stock situations and increases profitability. |
4. Delving Deeper: SAP S/4HANA Fashion Use Cases
Moving to SAP S/4HANA may seem complicated but the benefits of speed, flexibility and cost savings are clear.
As a close collaborator on the development of the SAP S/4HANA for Fashion and Vertical Business, Rizing was heavily involved in the acceptance testing of the product. As a result, we’re often asked about the motivation for SAP S/4HANA for Fashion. The value os clear, but we thought it is best explained via concrete SAP S/4HANA use cases.
Below we take a look at 3 specific scenarios:
1. Stock Protection
Vertical fashion companies often sell through multiple channels. However, not all the orders are placed at the same time.
Fashion companies must prioritize customers, channels, or markets to ensure that important customers are served first.
Stock protection helps companies achieve this goal by protecting inventory for high priority demand, even if important sales orders are received late and after other low priority orders.
On SAP S/4HANA for Fashion, stock protection works by prioritizing demand plans during the sales cycle. Two levels of stock protection can be implemented:
Horizontal Stock Protection
Horizontal stock protection keeps channels from cannibalizing each other in order to keep the possibility of balancing stock for a more profitable outcome.
Vertical Stock Protection
Vertical stock protection protects stock for high priority channels so that other channels cannot consume or poach it.
2. Backorder Processing
In traditional systems, conventional Available-to-Promise (ATP) is a function provided to help fashion businesses confirm order delivery dates based on actual supply chain and manufacturing resources. ATP provides this confirmation by analyzing data like warehouse stock, planned orders, and sales orders to ensure that future orders do not disrupt confirmed orders.
Although easy to use, the increased complexity in today’s digital world requires more complex mechanisms, leaving conventional ATP insufficient. For example, availability checks were done on a first-come, first-serve approach, which kept businesses from meeting their strategic priorities.
Advanced aATP
To cope with these changes, SAP introduced Advanced Available-to-Promise (aATP) on SAP S/4HANA Fashion to address the challenge of working in a dynamic environment. This allows fashion companies to react to changes in the supply chain and help manage demand and supply intelligently by ensuring optimal assignment of supply.
As seen in the above video, not reacting to the availability changes can result in confirmed quantities exceeding available quantities.
Revamped Backorder Processing
With the newly revamped Back Order Processing (BOP) on SAP S/4HANA, fashion companies can check stock availability after changes in the demand or supply during order fulfillment process and reconfirm if previously-calculated confirmations for sales orders or stock transport orders are still realistic.
Back Order Processing on SAP S/4HANA for Fashion uses five different predefined confirmation strategies (business rules) to minimize losses due to inventory stock-outs, protect customer interests, and ensure strategic customers always get served.
- Win: Shall be fully confirmed in time (the most important customer orders)
- Gain: Shall keep the confirmations and should gain if possible
- Redistribute: Might gain, might lose (orders that can lose confirmations)
- Fill: Shall not gain anything, should keep confirmation, but may also lose (non-priority customer orders)
- Lose: Shall lose all confirmations (orders under credit block)
Example:
A last-minute customer order is created for a very strategic customer. However, the stock has already been committed to another customer, belonging to a lower confirmation hierarchy, leaving no stock available for the priority customer.
After executing the back order processing, stock previously committed to sales orders with customers classified as REDISTRIBUTE, FILL and LOSE has shifted to the customer classified as WIN.
3. Flexible Fulfillment and Order Orchestration
When orders reach a fashion company through multiple channels, it’s hard for the business to manage inventory and conduct simultaneous logistical operations through multiple channels.
For fashion brands with legacy systems, this burden becomes two-fold because each channel is designed in isolation from the requirements and processes of each other, which means no system provides true inventory visibility across channels in real-time.
Delays and Errors
This results in delays and errors which ultimately lead to customer dissatisfaction. To overcome this challenge, brands have developed specialized software to achieve a modest degree of visibility and control over processes across channels. This does little to address the challenge of achieving true inventory visibility and to maintain that visibility on a real-time or near real-time basis.
As profitable order management becomes critical to a fashion business, it’s important to overcome challenges from inefficient and disconnected processes. They negatively impact profit margins and customer experiences to a degree that no retailer can afford.
Real Time Inventory
A real-time unique view of inventory is the starting attribute that retailers need to put in place to achieve a more efficient and innovation-ready order orchestration.
The underlying data model on SAP S/4HANA helps build this single view by connecting front-office with back office and digital channels with brick and mortar and transactional systems with consuming applications.
This way, fashion companies are able to fulfill demand for their products from anywhere, thereby reducing stock-outs and missed revenue opportunities.
Save the Sale
In the following SAP S/4HANA for Fashion omnichannel scenario, we look at how fashion companies can use ‘Save the Sale’ initiatives to confront an out-of-stock situation in-store.
By using a single pool of inventory, fashion companies can provide inventory availability to sales associates. This way, in instances of OOS, associates are able to view item availability at nearby stores and source intelligently from another store to fulfill in-store customer orders for out-of-stock products.
Building an SAP S/4HANA for Fashion and Retail Business Case
Most SAP customers understand that technology has advanced and know that they have to modernize to achieve the greater speed and flexibility demanded by the industry today. However, it’s not a simple decision to move as this change comes with heavy costs.
The move to SAP S/4HANA won’t make sense if companies simply look at it from a technology cost perspective. Companies must build a business case by looking at the value they will gain from the business benefits that S/4HANA Fashion Retail will provide.
The key is fashion companies that move to this next generation technology will have real-time data to make decisions faster and better satisfy customers.
5. Considerations: Migrating to SAP S/4HANA Fashion Retail
For fashion companies looking to implement SAP S/4HANA for Fashion or Retail, the project may seem complex and costly. This is especially the case for companies that may have multiple disparate SAP systems and processes across their global operations.
To help, we’ve put together some insights to industry leaders looking to transform their operations with a digital platform.
Considerations for Building a Global Template for S/4HANA Rollouts
As fashion companies grow, they often expand into different geographical locations worldwide resulting in multiple IT systems for each location. These fashion companies have come to realize that fragmented IT systems don’t allow a holistic understanding of their business understandings.
To overcome this challenge, fashion companies are turning to a unified SAP S/4HANA rollout across all locations worldwide.
However, building a template for the rollout can be complex as each location may have its unique requirements. Hence, the template will have to be a blend of unified processes and customization.
From SAP AFS to S/4HANA Fashion: Impact on Key Processes
SAP AFS has supported Fashion companies for years, but today many are looking to move their businesses onto SAP S/4HANA for Fashion and Vertical business for its next-generation capabilities.
With the move, SAP AFS customers will experience significant changes in the processes from what they are used to. SAP AFS customers should expect changes in the following processes:
- Available to Promise (ATP) is now Advance ATP (aATP)
- ARUN (Allocation Run) is now Supply Assignment
- Business Partner replaces the traditional customer and vendor master record
Designing for Omnichannel: Designing a Central Distribution Center for Wholesale, Retail and eCommerce
In today’s fashion industry, players of all kinds are pushing their direct-to-consumer businesses by combining their brick-and-mortar stores with eCommerce offerings.
While omni-channel retailing is the new norm, many fashion companies still struggle with omni-channel success because of the challenges it brings with supply chains. In order to ensure omni-channel success there are certain key considerations that fashion companies need to keep in mind when designing a central distribution center for all three channels:
- How do you ensure stock protection across different channels within a central DC?
- How can a central DC service multiple subsidiaries across multiple channels?
- How do you define the required priority?
- How can Product Allocation (PAL) be optimized?
Key Points to Consider When Upgrading S/4HANA Versions
SAP S/4HANA has been around for almost an entire decade. Thousands of companies around the world have benefited from this technology.
For early adopters of the solution the question of upgrading to a newer version is becoming increasingly important. The upgrade to the new version of S/4HANA needs to be executed according to business and industry requirements.
A few tips on how to ensure a smooth transition:
- Review release notes and identify the key impact areas based on the solution implemented
- Regression test the entire solution post-upgrade
- Cover all end-to-end scenarios during regression testing, including all variants
6. Migrating to SAP S/4HANA Fashion Faster
With the introduction of SAP S/4HANA for Fashion and Vertical Business, SAP broke ground by building a complete vertically-integrated real-time solution incorporating retail, wholesale and manufacturing operations.
At Rizing, we were fortunate to work closely with the SAP development teams by running acceptance tests and providing product feedback.
This unique position has enabled us to spearhead multiple SAP S/4HANA for Fashion implementations across the globe and develop a preconfigured solution using SAP S/4HANA Fashion to offer brands and retailers a complete ERP solution, designed for accelerated deployment, reduced costs and less effort.
attune Fashion Suite™: Accelerator for SAP S/4HANA for Fashion and Vertical Business
attune Fashion Suite™ is a robust, cost-effective solution that delivers all the benefits of SAP S/4HANA for Fashion with preconfigured functionality and a set of add-on tools to help fashion companies transition to a digital core via an accelerated path.
Currently, attune is engaged in multiple S/4HANA implementations, utilizing the attune Fashion Suite as a robust SAP S/4HANA Fashion rapid deployment solution.
Fashion Suite Benefits:
- Less Effort: Includes 80% business process coverage of a typical fashion company’s requirement, reducing implementation effort by 30-40% and minimizing the internal resource requirements
- Reduces Cost: Available on a cloud, subscription model to enable fast growing fashion brands to get the best in class technology at a fraction of the cost
- Best-in-class Processes: Brings best practice processes as out-of-the-box functionalities in supply chain, planning, finance, retail, procurement, cross-inventory consumption & more
- Tested and Implemented: Used by multiple fashion companies to accelerate their implementations of SAP S/4HANA for Fashion and Vertical Business
The attune Fashion Suite is a good fit for small and medium-sized companies (SMEs) and large enterprises to migrate to SAP S/4HANA Fashion. You can start realizing the benefits of S/4HANA in several weeks and it provides a solid platform for an evolving, broader transformation program.
Migrating from SAP AFS to SAP S/4HANA Fashion
By 2027, SAP will no longer support its existing ERP business suite. This proposition is forcing multiple users to move to the HANA in-memory platform.
While SAP S/4HANA promises many benefits, it’s important to remember that making the move is a large-scale project which requires an entire system to be migrated.
Luckily for customers running SAP Apparel and Footwear Solution (AFS), the migration process is slightly easier as they are already running on HANA and are already running a vertical business.
SAP AFS customers can use the SAP migration cockpit to move to SAP S/4HANA Fashion. This migration approach allows an automated selection and extraction of data from an SAP source system and facilitates direct data migration to SAP S/4HANA. By using the migration cockpit SAP AFS customers can benefit from:
- Predefined and easy-to-use migration activities
- Reduced migration cost and time
- No need for complex programming
- Eliminated need for files and staging tables
7. Manage S/4HANA Risks with a Future Reference Solution
For apparel, footwear and fashion companies looking to implement SAP S/4HANA for Fashion and Vertical Operations, the move creates a long list of questions that need answers before work can begin.
Some of the biggest customer concerns about making the move to S/4HANA is the potential disruption, organizational readiness, and impact to current operations. Customers worry about the difficulty of identifying the extent of potential change caused by a radical reconstruction of the entire SAP environment.
Minimizing Downtime
In order to avoid system downtime and business interruption, it’s essential to validate that new processes and applications work as required by the business.
Testing and validation must be done early and often to ensure high coverage of day-to-day business activities and system processes.
We’ve calibrated our leading practice methods and developed a pragmatic approach to implementing S/4HANA, assimilating our working knowledge of S/4HANA, its tools and accelerators along with our unique fashion industry acumen.
Future Reference Solution (FRS) for SAP S/4HANA for Fashion Implementations
To minimize risk, Rizing’s Future Reference Solution (FRS) provides fashion brands a re-usable, personalized template of SAP S/4HANA for Fashion that uses our rapid-deployment solution – attune Fashion Suite™.
Incorporating Rizing’s knowledge of SAP S/4HANA for Fashion and proven industry best practices, this fit-for-purpose solution is a configured S/4HANA for Fashion environment that helps reach the desired outcome more effectively and efficiently.
- It’s a Reference System for S/4HANA Fashion that helps define a Global High-Level Design Template with Reference Process Documents
- It goes well beyond a generic S/4HANA Fashion industry template capability by increasing the completeness and quality of the solution to be validated during design
- It’s built to steer the implementation by combining SAP and industry-leading practices with a fashion brand’s unique requirements
- It contains all of a brand’s major in-scope processes, addressing known and common challenges to be re-engineered and resolved by using standard SAP functionality
- It helps maximize the quality of the next phases while minimizing modifications due to preliminary work
8. SAP S/4HANA Frequently Asked Questions
As a result of our involvement in the product development of S/4HANA for Fashion, we’ve received many questions and inquiries from executives in the apparel, footwear, and fashion industry.
What are the significant business benefits of moving to SAP S/4HANA for fashion and vertical business? Especially for those who recently implemented a new ERP system?
In a word; simplification.
The world of business, the fashion and lifestyle industry, in particular, has become an incredibly complex place to navigate. Companies are now looking to simplify their back-end processes.
The greater the integration and harmonization of different channels, the easier for fashion companies to transform their processes to remain competitive.
S/4HANA, particularly for vertical fashion businesses, brings a higher degree of synchronization across different areas of the business, helping brands achieve a level of simplicity to keep operating at the speed of fashion itself.
Is SAP S/4HANA for fashion and vertical business replacing SAP Fashion Management?
S/4HANA for Fashion and Vertical Business is a separate product and doesn’t replace SAP Fashion Management.
That said, SAP Fashion Management is currently used by over 120 customers around the world and SAP Fashion Management will continue to be supported until 2027.
If I’m a pure play fashion retailer, should I go with SAP S/4HANA for Retail or SAP S/4HANA for Fashion and Vertical business? What additional functionality does the SAP S/4HANA for Fashion and Vertical Business license offer?
The two solutions share foundational functionalities such as Master Data, Season Management, and Value Added Services.
However, there are key differences between the two, other than the Manufacturing component. The most important differentiation is stock segmentation and supply assignment in SAP S/4HANA for Fashion and Vertical Business, which offers significant value.
9. Parting Words: Why act now?
Digital transformation has moved on from its initial hype to being a business priority. The fashion and retail industries have been susceptible to changes driven by technology, evidenced by regularly occurring store closures and bankruptcies of companies that were slow to adapt.
The Gold Rush
On the flipside, it also resulted in a gold rush-like frenzy to implement digital initiatives and projects.
But as some are finding out the hard way, many of these projects end up as false starts, mired in the complexities and limitations of the previous generation of ERP systems.
Core Strength
While the likes of IoT, AI and chatbots hold great potential in digitization programs, what most businesses are realizing is the need to have a core that brings all applications together and facilitates organic extensions to new technologies.
SAP S/HANA FTW
The sum of the real-world business scenarios discussed above showcase how SAP S/4HANA for Fashion offers an end-to-end solution for fashion companies to run live.
These are not merely incremental improvements based on processes that have existed before, but transformational change delivered to each department, bringing new value to the business.
These examples show that by starting a business transformation project renewing the ERP core with SAP S/4HANA – a company can safely plan for a significant transformation of its business while minimizing the risk.