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Retail Tech: Salesforce Layoffs, Leap Powers New ThirdLove Store

The weekly Retail Tech Roundup compiles technology news across the supply chain, manufacturing, retail, e-commerce, logistics and fulfillment sectors.

CRM

Salesforce

Salesforce is yet another technology firm laying off employees as part of a restructuring plan, reducing its current workforce by approximately 10 percent, the CRM company revealed in an SEC filing. The job cuts affect more than 7,000 employees.

As part of the restructuring, Salesforce will exit select real estate and reduce office space in some markets.

On the same day Amazon said it’s sacking 18,000 workers, Salesforce informed employees of the job-cutting decision. In a letter on Wednesday, Salesforce CEO, chairman and co-founder Marc Benioff said, “As our revenue accelerated through the pandemic, we hired too many people leading into this economic downturn we’re now facing, and I take responsibility for that.”

The CRM giant operates across industries, but provides tools that help retailers cater their e-commerce and in-store shopping experiences to individual consumers with targeted promotions to boost customer loyalty and engagement.

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The restructuring is intended to reduce operating costs, improve operating margins and advance Saleforce’s commitment to profitable growth, the filing said.

The company estimates that it will incur approximately $1.4 billion to $2.1 billion in charges in connection with the restructuring, of which approximately $800 million to $1 billion is expected to be incurred in the fourth quarter of fiscal 2023. These charges consist primarily of $1 billion to $1.4 billion in charges related to employee transition, severance payments, employee benefits, and share-based compensation; and $450 million to $650 million in exit charges associated with the office space reductions.

Salesforce also estimates it will incur approximately $1.2 billion to $1.7 billion in future cash expenditures in connection with the plan.

Last November, Salesforce revealed an initial round of layoffs in early November affecting “hundreds” of workers, with co-CEO and co-chair Bret Taylor announcing shortly after that he would step down.

In the U.S., affected employees will receive a minimum of nearly five months of pay, health insurance, career resources and other benefits to help with their transition. Those outside the U.S. will receive a similar level of support, and our local processes will align with employment laws in each country.

The Salesforce cuts follow a year of high-profile layoffs at tech companies like Facebook parent Meta, which laid off 13 percent of its workforce, fintech giant Stripe which cut roughly 14 percent and Twitter, which terminated 50 percent of workers.

The actions associated with the employee restructuring are expected to be substantially complete by the end of Salesforce’s fiscal 2024, subject to local law and consultation requirements. The actions associated with the real estate restructuring under the plan are expected to be fully complete in fiscal 2026.

Product decision making

Garmont International/MakerSights

Italy-based performance footwear manufacturer Garmont International has selected apparel, footwear and accessories product decision platform MakerSights to better develop products and create assortments.

With MakerSights in the fold, Garmont aims to better connect with thousands of target consumers to validate its product strategy, and identify which products to invest in and which products to cut from the line.

“MakerSights allows us to validate our creativity with consumer data and insights, keeping us in lockstep with our target consumers and giving us the information we need to approach our product strategy with a balance of art and science,” said Davide Calcagnotto, chief operating officer, Garmont.

The MakerSights platform played a critical role in the design and product marketing teams’ ability to react quickly. The initial test reached statistically significant results within 24 hours of launch with consumer sentiment data and feedback available in real-time via an interactive chart within the platform.

Filtering responses by age, gender, where they shop and the competitors they shop with, enabled Garmont to develop rich consumer profiles within the larger target audience and hone their colorway strategy. Ultimately, 20 percent of the SKUs tested were cut from the line due to low performance with target consumers, saving the company sampling costs and making room in the line for deeper investments in higher-performing SKUs.

“Our first MakerSights test revealed a major market opportunity we would have never been aware of otherwise,” said Paolo Martignon, product marketing manager, Garmont. “The interactive charts and graphs made it easy to see that a new colorway, originally slated for women, had an equally strong response from men so we quickly decided to bring the colorway to market in both lines. We also discovered that a new style that the team was excited about was also exciting our target consumers, especially consumers that currently shop with our competitors, giving us the confidence to invest more in this style than we had originally planned.”

Moving forward, Garmont will leverage MakerSights throughout the concept-to-consumer process with a particular focus on evaluating product newness, line adoption,and sell-in with key accounts.

Physical retail

ThirdLove/Leap

ThirdLove opened a new store in Philadelphia powered by Leap, the retail platform that is designed to help digital natives expand into physical retail.

Located on Walnut Street in Rittenhouse Square, the store is ThirdLove’s ninth brick-and-mortar destination. The expansion represents the first store for both ThirdLove and Leap in Philadelphia.

The Leap platform handles operational aspects such as scouting and leasing real estate, brainstorming store design and staffing for digital native brands, enabling them to maintain their focus on the areas they are more proficient at like marketing. It leverages millions of first- and third-party data points to determine where a brand should deploy stores and which brands are most likely to be successful in which locations.

Leap has helped brands such as Rent the Runway, Pact, Sunday Citizen and Naadam open stores.

The retail platform, which is a partner of Simon Property Group, has additional plans for other brands in the Philadelphia market over the next 12 months. Leap has plans for a store at King of Prussia Mall and additional locations planned in the Rittenhouse neighborhood.

Today, Leap powers 60 brands across nearly 100 stores in markets including New York City; Los Angeles; Chicago; Southern Florida; Dallas; Austin, Texas; Scottsdale, Ariz.; San Francisco; Boston; Columbus, Ohio; Greenwich, Conn.; and Washington, D.C.

The platform raised $50 million in Series B funding to kick off 2022 and has expanded its category capabilities from apparel and footwear into accessories, jewelry, intimates and home goods.

3D body scanning

Bodd

Bodd, an Australia-based fit technology startup, has received $5 million to further build out its 3D body scanning capabilities. The round was led by retail entrepreneurs Candice and Nick Hirons, who brought the G-Star Raw denim brand to Australia, as well as Bodd’s CEO and executive chairman Tim Allison.

With the financing, Bodd will build on its existing presence in apparel and expand into wellness, fashion retail and pharmaceuticals in North America, while hiring additional employees to power the growth.

The company uses 3D scanning to enhance the shopping experience of customers and brands in the apparel, uniform, fitness and pharmaceutical industries. All the information needed to create a “body passport” can be captured in under 60 seconds using a self-serve, non-invasive scanner which is manufactured in Australia by Bosch.

Bodd’s technology features a touch screen interface to guide consumers through the process, rapidly extracts customer measurements across any point or contour on the body, and can integrate and store data within an existing CRM.

The technology can help increase online conversions and decrease returns by enabling instant sizing recommendation without try-ons. Customer body measurements are used as a “size-match” tool, outputting sizing and fit recommendations for any product in a range. Garment specifications and measurements or a direct pattern are matched to the customers and measurements.

Bodd’s technical team spent five years developing this technology in collaboration with the Australian universities Swinburne University of Technology and RMIT.

Apparel production

Odlo/Coats Digital

Odlo Romania S.R.L, the fashion manufacturing arm of sportswear brand, Odlo International AG, has reduced the time it takes to produce its core styles by 13 percent, resulting in a productivity increase of 10 percent since its adoption of Coats Digital’s GSDCost in July 2021.

The brand says it has subsequently increased its profit margins, improved on-time deliveries, enhanced team member motivation and earning potential and been able to take on more new order requests as a result of the GSDCost implementation.

Odlo Romania S.R.L, produces more than 2.4 million pieces a year and supports a workforce of just under 500. Like its name states, the manufacturing arm is based in Romania, while the brand operations are based in Norway.

Prior to implementing Coats Digital’s GSDCost solution, Odlo based its cost and capacity forecasts on what it called “inaccurate” historical data stored in multiple Excel spreadsheets which were difficult to update in real time across all costing, capacity planning and manufacturing teams.

As a result of inaccurate standard-minute values (SMVs) regarding cost-to-make production times, and poor costing and planning visibility, Odlo occasionally failed to meet on time delivery targets, which meant steep additional overhead costs and customer complaints due to the often-last-minute realization that there was a lack of actual capacity available on the production floor. Standard-minute values (SMVs) are a Coats Digital benchmark representing the time required for an employee working at standard performance to complete a given task.

Conversely, without accurate capacity planning and costing data, Odlo also found itself turning business orders away unnecessarily, when it had sufficient capacity to fulfill new order requests.

“Without a scientifically proven method to assess production goals or realistic Standard-Minute-Values to inform our costing and capacity plans, we were consistently challenged by a series of unexpected capacity issues,” said Sampath De Silva, administrator, Odlo Romania S.R.L. said. “Not only did we sometimes experience higher production costs and late deliveries due to buffered SMVs, but we occasionally also turned business away, as we incorrectly estimated that resources were not available to meet requirements in time.”

Shortly after the adoption of GSDCost, Odlo undertook a rigorous training program so that relevant teams could understand the platform’s motion codes and standard core style sequences. The on-site training and practical session helped to foster greater team buy-in to the change management program required internally to get the project fully embedded across all relevant departments.

“Coats Digital’s expert trainers effectively demonstrated method engineering techniques practically at the shop floor level and our teams quickly understood the key principles by observing the actual motions in play,” De Silva said. “We have subsequently proven that GSDCost is not only a robust software tool, but also a valuable method engineering tool that can make a real difference to our business.”

Following the implementation of GSDCost, Odlo was able to successfully establish international standard time benchmarks based on standard motion codes and predetermined times. This enabled the sales, costing, planning and manufacturing teams to communicate efficiently using the same language, based on a scientific method for correctly analyzing manufacturing costs.

As a result, business units can better negotiate product prices with customers.

Since the adoption of GSDCost, Odlo has additionally been able to introduce a popular productivity bonus system based on accurate cost-to-make measurements, which has helped build team members’ confidence in achieving realizable productivity goals that increase their earning potential.

Cross-border fulfillment

Wish/Eurora

Mobile e-commerce marketplaces Wish is partnering with Eurora Solutions, a provider of artificial intelligence/machine learning (AI/ML)-backed global trade technology solutions,

As part of the partnership, Eurora will help Wish improve operational speed and efficiency in a variety of complex cross-border fulfillment scenarios. Eurora, closed a $40 million Series A round in April 2022, uses AI and ML to automatically manage cross-border value-added tax (VAT), duty amounts and declarations. More than 250 clients already use the company’s platform to send parcels.

“Our aim is to continuously improve our operational excellence and customer experience, and we believe this partnership will play an important role in helping us better automate in key areas of the fulfillment process, translating to improved logistics performance and, ultimately, a better user experience,” said Mauricio Monico, chief merchant officer, product management at Wish.

Since a majority of Wish’s customers are based in the U.S., Canada, South America, Europe and Australia, where each day almost 1 million products are purchased across Wish’s platform, Europa expects its engagement to help reduce the operational costs of Wish’s logistics department in those key markets.

Mobile commerce

Mad Mobile

Mad Mobile, a platform designed to improve mobile commerce and payments for retailers and restaurants, has raised $20 million in financing from Eastward Capital Partners.

This capital infusion will accelerate further development of Mad Mobile’s technology platform for modern point-of-sale and payments and will fuel commercial market growth.

The company has experienced substantial growth in recent years amid the accelerated mobilization of both digital and physical retail, now powering experiences in more than 21,000 major retail and restaurant locations.

Mad Mobile offers businesses features such as mobile POS, mobile ordering, self-checkout, clienteling, mobile fulfillment and contactless payment. The platform processes more than $3 billion in payments annually.

Top customers include Ralph Lauren, Tractor Supply, Meijer, Talbots, Estee Lauder, Brooks Brothers, Urban Outfitters, Snipes and West Marine.

Mad Mobile is also a go-to-market partner for some of largest names in mobility and enterprise software, including Apple, Samsung, Amazon and Salesforce.

Material handling

Trew

Automated materials handling solutions provider Trew is establishing a technology center in Fairfield, Ohio to fuel material handling solution innovation and create at least 75 new engineering jobs, ranging from skilled labor technicians to business class enterprise software developers. The investment will cost $32 million.

Trew will receive up to $4 million in assistance with an R&D grant from the state’s private economic development corporation, JobsOhio.

Trew delivers intelligent automated material handling solutions for retail, e-commerce, distribution and manufacturing clients enabling operations to fulfill orders efficiently and accurately. The company manufactures the equipment and software that allows its customers, primarily retailers and packaged goods manufacturers, to pick, pack and sort their products for shipment. It customizes that equipment to each customer’s individual needs.

The grant further allows Trew to accelerate investments in developing automation technologies, warehouse execution software and to create a demonstration, testing, and training facility.

The company operates three facilities in North America—Fairfield, Milwaukee, Wisc. and outside of Toronto—and its manufacturing capabilities currently consist primarily of assembly.

Trew worked with several state and local partners, including JobsOhio, the Ohio Department of Development and economic development firm REDI Cincinnati to obtain support for assistance with the innovation and job-creating project. Trew chose Ohio for its technology center and investments due to the availability of information technology and engineering talent, accessibility to multiple customers who have retail and e-commerce distribution centers, and the willingness of organizations to help businesses access resources to enable growth.

Automated material handling solutions from Trew include Warehouse Execution Systems (WES), Warehouse Control Systems (WCS), PLC- and server-based machine controls, motorized driven roller (MDR) conveyor, conventional conveyor, and services such as concepting, engineering, technical support, parts, field service and training. Serving the North American retail, warehouse, distribution, manufacturing, and e-commerce industries, Trew’s staff and network of integrator partners enable smart solutions scalable to any material handling needs.