CASE STUDY Retail – Apparel / Fast Fashion
Prescriptive Analytics
and Daily Planning
SOLUTIONS OFFERED
Demand Planning
Replenishment Planning
Markdown Optimization
Supply Chain Analytics
Supply Chain Visibility
DeFacto’s Challenge: High Markdowns = Low Margins
Since opening its first store in 2004, DeFacto has experienced phenomenal growth expanding its geographic footprint to over 11 countries in and around Eastern Europe, Middle-East and North Africa. Anchored by its cutting edge design studio in Barcelona, Spain, DeFacto churns out innovative and trendy clothing/ accessories for men, women, teenagers and children that are high quality and affordable.
Although the company was built around good product design and smart merchandising, DeFacto’s demand and inventory planning functions were entirely managed by the merchandising team through an internally developed replenishment algorithm with data coming from internal legacy systems. With poor support on demand and inventory planning, the merchandising team often relied on Excel and blunt statistical averages to plan inventory, perform pre-season deployments, and replenish stores. They performed allocation decisions without the ability to see the revenue potential across their entire network leading to stock- outs. Rising stocks due to excess ordering or mis-deployed inventory meant store managers increasingly had to adopt aggressive markdowns to clear inventory, resulting in significant gross margin erosions for the company.
The Hunt for the Perfect Pair of Shoes
Prescriptive Analytics and Daily Planning for DeFacto
Solvoyo helped DeFacto take a portfolio view of its supply chain. As an apparel retailer, Solvoyo segmented DeFacto’s products into: (i) Fast-fashion & (ii) Fashion-basics. For Fast- fashion, Solvoyo estimates the seasonal product life-cycle based on similar attribute clusters (sub-category+option+color, etc.) from multiple years of years of POS-level sales data and promotions history, and replenishes the stores based on maximum revenue potential. For Fashion-basics, functional products with longer shelf life and predictable demand, Solvoyo forecasts demand, plans vendor orders, and store replenishments across the entire network.
Within 5 months of the start of the project, Solvoyo’s cloud-based multi-tenant platform went live with full integration to DeFacto’s legacy “on-prem” suite of systems. The platform allows merchandising teams to view and edit replenishment recommendations based on exceptions. Periodically (currently every fortnight), Solvoyo generates a plan to re-deploy Fast-fashion inventory among the stores based on maximizing the revenue potential or minimizing revenue loss from future markdowns.
Rewarding Results

Solvoyo has helped our business improve accuracy of inventory placement to support forward sales and better serve our customers. In our environment of continual technical advancement it has proved to be a great advantage
About Solvoyo
Solvoyo is the next generation planning and optimization platform built for the digital revolution in supply chain. Solvoyo helps companies close the gap between planning and execution. Our all-in-one platform forecasts demand, optimizes inventory, plans production, replenishes networks and concurrently optimizes transportation plans. Solvoyo is the only planning platform that allows companies to plan strategic, tactical and operational supply chain actions in one tool. The scalability, analytical capabilities and short implementation cycles of our true cloud platform help our clients achieve dramatic improvements in performance. We are headquartered in Boston, MA with our R&D center in Istanbul, Turkey. For more information,
please visit: www.solvoyo.com.
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