The Heilan Group is a leading garment company that was established in 1988 in Jiangyin City, China. With 60,000 employees, in 2016 the Heilan Group ranked No. 202 in China’s Top-500 Enterprises and number 36 among China’s Top-500 Private Enterprises with total assets of USD 7.5 billion (RMB 50 billion). Heilan Home is a fully owned men’s apparel subsidiary of the Heilan Group. Created more than a decade ago, Heilan Home now has over 5,000 outlets in China and is among China’s top brands.
Heilan Home Embarks on New Retail
The turbulent convergence of the Internet and consumer economy is disrupting the retail landscape, pushing physical retail store operators to rethink long-standing operating models. ‘New retail’ is the common buzzword rising from this convergence. New retail calls for enterprises to leverage the Internet and emerging technologies such as Big Data and artificial intelligence to upgrade and even reinvent manufacturing, logistics, and sales processes. New technology is reshaping the structure of the retail industry by combining online services, offline experiences, and modernized logistics. In summary, new retail is customer-centric rather than product-centric.
While the tide of transformation has closed many retail businesses that failed to react to the changing market forces, Heilan Home owes its success to an operating model based on the synergy of headquarters’ brand management, outsourced manufacturing, a central logistics warehouse, and a network of chain stores for sales. Heilan Home calls this unique business model ‘semi-franchising’ for which the competitive edge is the ability to quickly engage franchisees’ capital investments to expanding its business presence by building new stores. Heilan Home has built a highly digitalized industry chain for managing all suppliers and stores that underlies the efficient operation of the semi-franchising model.
Heilan Home is a retail enterprise acting with the mindset of an Internet company.
In 2016, Heilan Home began a 200-store pilot operation of its Internet retail project that enabled consumers to place orders online and pick up the goods offline. In 2017, Heilan Home teamed up with Tmall, an Alibaba online shopping mall, to expand the reach of this new, cooperative retail operation. These Internet initiatives include upgrades to over 5,000 Heilan Home retail outlets into smart stores that catalyze the convergence of the company’s online and offline operations. The novel operation brings the additional advantage of empowering Heilan Home with precision recommendations derived from the Big Data collected from online shoppers. Heilan Home is now looking to launch more cutting-edge digital consumption experiences in the future, including unmanned retail, intelligent window showcasing, scan-and-buy, intelligent shopping bags, smart fitting mirrors, and instant delivery. The next phase of online offers will take the retail shopping experience to new and greater heights.
Thanks to its asset-light operation, Heilan Home has emerged as a leader for the new retail paradigm.
SAP HANA Fuels Heilan’s Rapid Business Growth with a Digitalized System
An efficient and reliable IT system is instrumental to supporting rapid business growth. Heilan Home has promoted digitalization as a top priority and has been an early mover with the rollouts of multiple systems, including SAP Enterprise Resource Planning (ERP), Customer Relationship Management (CRM), and Extended Warehouse Management (EWM). The superior performance of SAP HANA as an in-memory database has enabled Heilan Home to move its various business systems to one system, and gain unprecedented efficiency in real-time data processing and analytics. Their success in digital transformation has empowered Heilan Home with new levels of agility and speed in reacting to the constantly changing fashion retail landscape.
In 2015, Heilan Home rolled out the SAP EWM system to support the processing of 60 TB of complex supply-chain queries and analytics. To meet this requirement, the company selected the Huawei SAP HANA solution in a cluster configuration of five 1.5 TB HANA nodes. Upon going live, the EWM system ran stable peak loads. This ensured that the Heilan Home warehouse system was provisioned with sufficient resources.
Heilan Home also chose the Huawei KunLun SAP HANA solution as the core platform for its ERP transaction system. At a 30 percent average annual growth, the resource utilization of the old ERP system was causing great bottlenecks. The company responded by deploying a KunLun-based 12 TB SAP HANA appliance for its ERP platform. Heilan Home began to reap massive supply-chain efficiencies, including warehouse and commodity management. The KunLun Mission Critical Server, engineered with RAS 2.0 reliability, was provisioned with 8 CPUs to keep Heilan Home’s business on track throughout the company’s digital transformation, and has helped the company to confidently prepare for future commercial and technological growth.
KunLun eliminated the performance bottlenecks created by Heilan Home’s legacy ERP system and enabled real-time data write and analytics through HANA, helping Heilan Home fully tap into the wealth of information collected from casual shoppers and committed customers.
• Real-time data write and analytics: Service data is recorded in real time, and the time to generate warehouse data reports has been reduced from more than 10 hours to minutes or less. The reports function as a timely reference for decision-makers charged with managing a fine-grained supply chain, which translates into better front-end experience for customers.
• Efficiency boost: ERP performance improved 4-fold, financial settlements have been sped up 50-fold, and main-data-read performance has increased 20-fold. There has also been a leap in logistics efficiency, as the time needed to deliver truckloads of cargo from depots to factories is slashed by 80 percent.
• Adopting innovative applications: The large memory capacity and superior performance of the KunLun SAP HANA platform enables Heilan Home to retain historical sales data for analysis using the new ERP system. New and past-season products are often received quite differently by different regions and outlets. By using ERP real-time analytics, the KunLun SAP HANA solution can intelligently select the most-suitable target outlets for promoting past-season products. The result is an optimized distribution of goods and an increase in the sales of past-season products by about 15 percent.
• 24/7 High Availability (HA): KunLun SAP HANA promises maximum service uptime by supporting online replacements, component upgrades, and automatic device replacement for failed core components.
• Meeting the next 3 to 5 years of business needs: KunLun eliminates current business growth bottlenecks and supports future business growth.
• Open platform: The open platform avoids lock-ins and maximizes ROI.
“Huawei’s KunLun Mission Critical Server has passed SAP HANA certification,” said Zhang Xiaofan, manager in charge of the Heilan Home ERP upgrade project. “The KunLun-based 12 TB SAP HANA appliance and SAP applications have helped us eliminate system performance bottlenecks and made our continuous business growth possible. In the future, we will leverage innovative ICT solutions to enhance technical support for our business growth and innovation.”