Improving Vendor Relations through Optimized Tradeflow

Dan Ferrara - HBCJack Robinson - SPI

• Retailer -Vendor relationship• Industry pain points• An approach to automation• HBC Vendor Portal initiative• Looking ahead

Improving the various workflows between a retailer and its trading partners results in a more collaborative environment in addition to financial gains.

Agenda

About SPI

The Right Retail Partner 15+ years of demonstrated success with blue chip

retailers: HBC, Macy’s, Ahold, Belk and many more Best of both worlds: Global delivery model offering

the best value for our clients Client-focused approach: Tailored to meet the needs

and culture of each individual client with a 95% client retention rate

Commitment to offering solutions aimed at reducing costs and improving margins

Retailer-Vendor Relationship

Deal/Agreement Mgmt

Claims Management

Vendor Compliance

and more……

New Vendor Sign Up

Allowances Handling

New Item Set Up

AP Inquiry

Vendor Universe

Finance

Merchandising

Vendor Control

Supply Chain

Retailer

and many more……

Other stakeholders….

Industry Pain Points Drivers Impact

Hard copy Agreements/Allowances

Claim communication via Email

New vendor setup via Fax/Email

Manual three way matching

Multiple data storage locations

Manual retrieval of data

Item data communicated via

Email/Fax

Rekeying of hand written information

Hard copy invoices from vendors

Missing/Incorrect/Duplicate Deals

Transactional disputes & Tension

Delays & Lack of visibility

Erroneous Payments, Auditing costs

Hard to access historic information

No reporting capability

Poor quality of data in the system

Low productivity & High admin cost

Missing data handoffs

An approach to automation

Administration Workflow

Core Modules

Client-Specific Modules

Claims Management

Vendor Set Up

Deal Management

Allowance Management

Content Management

A new Module

Data Input /Output Layer

Reporting Layer

Customizable Platform Secure 24x7 Global Access Portal Technology Simple SaaS Pricing Hosted Externally/Internally Integration with ERP systems Data Retention/Retrieval Ability to Add New Functionality Electronic Audit Trail Role-Based Access Business-Specific Reporting

Key Features

About HBC

Canada’s Largest Retailer With over 600 retail locations and over 50,000

associates located in every province in Canada HBC operates the Bay, a major department store,

Zellers, a mass merchandise format, Home Outfitters, a kitchen, bed and bath specialty store, and value-priced Fields stores

Hudson's Bay Company is the Canadian retail entity of Hudson's Bay Trading Company (HBTC)

Where We Started

Vendors

Finance

Buyers

Legal

Vendor Control

Fielding payment inquiry calls Responding to requests on

past transactions

Issues in getting deals and allowances setup

Challenges with timing of recognizing funds

Delays in getting all the approvals during vendor setup

Issues in storing and tracking all the paperwork

Difficulty in ensuring that all the terms and conditions have been agreed and reflected

Felt like they were dealing with a black-hole and complained of lack of attention

Perceived the relationship as stressful and non participatory

HBC Vendor Portal Initiative

Vendor Set Up

Master Vendor Agreement

Special Allowances

AP Inquiry Lookup

Content Management

Key Business Objectives

Enhance visibility and accountability across the procure to pay process

Eliminate leakages in the current manual workflows

Provide self-service features to enhance productivity

Improve the quality of information by storing the right data

Generate meaningful reports that would drive business decisions

Development Details Specifications

Web application built using Java and Oracle

Interfaces real time with the AP Processing application (Oracle)

Hosted within HBC firewalls

Vendor Setup

Agreements

Allowances

AP Inquiry

Content Mgmt

Results/Benefits

11

Vendors•Constructive partnership: Active participant in the procure to pay process•Better relationships: Quick identification/resolution of overpayments •Access to information: 24x7 access to deals, payment status, forms, etc

•eDeals: Eliminating the document retention company•Timely fund recognition: Better planning and better relationships•Increased productivity: Reduction in time taken to set up a new deal

Finance•Call volume reduction: 30% reduction in basic inquiry type calls•Reduced auditing effort: Reduction in certain merchandising claim types•Time value of money: Cash in the current year

Merchandising

Vendor Portal has enabled HBC to put in permanent fixes to issues that cause financial leakages year on year, in addition to fostering a collaborative trading environment

Looking Ahead…

1

2

3

4

5Vendor Set Up

Content ManagementAP Inquiry

AgreementsAllowances

Claims HandlingVendor Statements

Cost Change Notification

Sharing of other types of information

HBC’s vision is to for the vendor portal to serve as a one-stop shop for all stakeholders involved in the procure to pay process.