K&G Men's Center needed retail-oriented technology solutions to support the company's growth. Fortunately, the company was able to find a solution provider that met its unique needs.
K&G Men's Center is a $200 million retailer of men's clothing, with products ranging from socks and underwear to tailored suits. Some of its business practices are atypical for retailers. The company operates as a drop-ship operation manufacturers deliver goods directly from factories to the stores. That in itself is not as unusual as the hours at a K&G store: open only Friday through Sunday. The stores spend the rest of the week managing the incoming drop shipments and preparing them for sale. This allows the chain to sell items at a 27% markup. Scott Saban, vice president of operations and information systems at K&G, credits these offerings as the chain store's "footprint" and says, "That is the reason that customers keep returning. The drop-ship environment allows us to offer customers significant savings, but we still maintain current, in-season clothing."
Saban also credits K&G's technology infrastructure with supporting the company's success. K&G started out as a four-store chain in 1989. Four years into the company's growth, it became apparent that K&G would need a stronger IT infrastructure to accommodate future growth. So, in 1992, the company turned to STS Systems, an international supplier of integrated computer applications designed for retail. STS began to work with K&G on the technology solutions that would help the men's clothing store become a nationwide retail chain.
"We had a lot of different needs because of the way we run our business," explains Saban. "The drop-ship environment was, of course, unique. We also needed flexibility for varying transaction sets because we have different stores across the country. We needed solutions that allowed for exceptions and regional pricing differences." Saban felt that the STS Systems StoreWorks Suite was a good fit for these needs. It would also allow K&G to handle what Saban refers to as "non-sales" functions, such as shipping and receiving, transfers, returns to vendors, and markdowns.
In addition, the store has built its foundation on an NT network with a dedicated server. Each client in the system is not only a register, but also a workstation. When merchandise comes into the stores, it is directed to the workstation where the purchase order is pulled up, and a list document is printed. Employees go to the floor with handheld devices. There, they ticket and scan products and then upload data at the workstations.
Upgrade Links Stores With Headquarters
K&G now has a beta site for the latest release of STS Systems' StoreWorks Suite. This new version will allow the company to integrate e-mail between stores and headquarters, as well as implement in-store ticket printing. The upgraded system will also allow for electronic gift cards, management reporting tools, a UPC (universal product code) locator, and an in-store labor scheduler that interfaces with the company's payroll application.
Despite being a $200 million company, K&G has been able to maintain its growth and technology infrastructure with only four full-time IT personnel and the support of STS Systems. "We look at STS Systems as a partner," comments Saban. "We each want the other to succeed."