ProfitLogic, the industry-leading provider of Retail Profit Optimization (RPO) solutions, today announced that it is adding insight to over $40 billion in merchandise across twenty-five major specialty, department store and mass merchant retailers, a doubling of merchandise under management from last year.  This increase is a result of significant new customer acquisitions in North America and Europe as well as expanded adoption within the existing customer base.  To support this growing adoption, ProfitLogic now offers an extension of its RPO suite to include tailored applications for the full range of retail formats, including promotion-intensive and every-day-low-price (EDLP) operations.

“It’s no surprise that demand analytics and optimization solutions are taking off in retail,” said Bob Buchanan, Retailing Industry Group Leader at A.G. Edwards.  “These tools have been proven over the last few years and clearly exploit one of the largest untapped assets of every retailer — their own sales and inventory data.  The result for industry leaders like JC Penney and Target and The Gap is merchandising decisions that are more profitable and more consistent.”

RPO represents an expansion of the proven benefits of Merchandise Optimization to a broader spectrum of retailers and types of merchandise.  ProfitLogic is uniquely positioned to deliver this capability through its groundbreaking data management and analysis infrastructure, the Rapid Results MethodologyTM.  For more information, please refer to our recent press release, ProfitLogic Delivers Quick Value with Rapid Results Methodology™. Emphasizing a fast implementation timeframe and an immediate ROI, this methodology is the result of over 20 years of experience working with major retailers to address their most pressing inventory management and pricing challenges.

“Since 1983, ProfitLogic has been 100% focused on helping retailers more profitably manage their inventory investments through deeper insight into customer demand,” said Tom Ebling, Chairman and CEO of ProfitLogic.  “We look forward to applying the lessons we have learned from years of implementing enterprise-class retail solutions to the expanding opportunities for improved performance in inventory management and pricing in all retail verticals.”   Growth in Adoption Led by Industry Standard Markdown Optimization Solution A key to the accelerated adoption of Retail Profit Optimization solutions has been the dramatic results experienced through Markdown Optimization, the flagship offering in ProfitLogic’s RPO suite. Twenty-five major retailers, including specialty retailers like American Eagle Outfitters and Famous Footwear, department stores like Bloomingdale’s and JC Penney, and mass merchants like Meijer Stores, have successfully implemented Markdown Optimization to achieve greater return from markdown spend, to better manage inventory clearance, and to gain greater control over the business in season. Based on the success of these ground-breaking leaders, retailers are now embracing RPO solutions through full-scale implementations across all dimensions of their merchandise. In many cases, the fast and significant return on investment from Markdown Optimization has funded the extension of RPO solutions to the areas of assortment, allocation, and promotional pricing.

RPO Solution Suite Now Expanded to Handle the Unique Inventory Management and Pricing Needs of Every Day Low Price and Promotionally-Intensive Retailers

ProfitLogic has expanded its RPO suite of solutions to address the key inventory management and pricing challenges unique to EDLP and promotionally intensive retailers. The Hi-Low purveyors of more seasonal merchandise require decision support that helps to most profitably flow and clear merchandise by a desired outdate. Retailers of longer lifecycle merchandise, on the other hand, require decision support that helps most profitably increase sales and capture market share. The key to that insight is a detailed understanding of product affinities and how they drive demand. Whether the business challenge is around the implications of competition on everyday pricing, the right categories and items to promote, or the ideal inventory levels to support upcoming promotions, a scalable understanding of demand at the customer transaction-level is a prerequisite. 

Leveraging an acquisition made early in 2004, ProfitLogic has incorporated customer transaction-level analysis capabilities into its RPO suite, infusing its industry-leading solutions with market-basket analytical capabilities.  These solutions are tailored for the unique needs of retailers whose category managers must find new ways to maximize sales and margin and stay a step ahead of Wal-Mart while capitalizing on vendor-funds and increasingly tailoring their offerings to local-market demand.

ProfitLogic’s expanded RPO solutions include capabilities that help retailers:

Optimize everyday and competitive pricing

Optimize promotional planning and pricing

Optimize category management

Optimize inventory Levels to Support Promotions

“The holy grail in merchandising has always been the ability to understand the combined impact of inventory investments and marketing spend on customer demand before taking action,” says Scott Friend, ProfitLogic’s Co-founder and President.  “With ProfitLogic’s expanded suite of RPO solutions, retailers across all segments can now benefit from the power of demand analytics and optimization and can fully optimize their inventory management and pricing processes.”   For more information on all of ProfitLogic’s Retail Profit Optimization solutions, please visit us at our new booth #433 at NRF 2005.

About ProfitLogic ProfitLogic provides an industry-leading suite of Merchandise Optimization solutions designed for retailers whose priority is getting the highest return on inventory investments.  ProfitLogic’s solutions provide merchants with day-to-day operational decision support and workflow for making better-informed assortment execution, allocation and fashion replenishment, promotion, pricing and markdown decisions. ProfitLogic has delivered fast, flexible solutions with significant financial benefit to industry leading retailers such as American Eagle Outfitters, AnnTaylor, Bloomingdale's, Charming Shoppes, Gap Inc., including: Banana Republic, Gap, Old Navy, Gap International and Gap Outlet; JCPenney, Lerner New York, Marshall Field's, Meijer Stores, Northern Group Retail, Sears, ShopKo Stores, Target Stores and Toys R Us.  For more information about Cambridge, Mass.-based ProfitLogic, call 617-218-1900 or visit www.profitlogic.com.