When a Los Angeles headquartered fashion brand made the strategic decision to introduce its unique bohemian aesthetic into the Australian market, they looked to us as a strategic partner to handle all aspects of their Australian distributions.

The brand’s international distribution channels included e-commerce platforms such as ASOS, Zalando and the ICONIC, local sales agents for wholesale accounts and major department stores and discount retailers.

How we helped

Our role involved evaluating software solutions, establishing a finance function, providing operational and logistical support to their head office team and managing their local customer service requirements in Australia.

Establishment of operations

  1. Accounting System: The client required an accounting system that allowed their group finance team based in the US to readily access information regarding their Australian operation for group reporting purposes. We suggested choosing a system that could readily integrate with various other commonly used software solutions as required for a distribution business. We evaluated the advantages and limitations of the various cloud based accounting systems and determined that Xero would be the most appropriate option. In setting up the accounting system, we aligned the business’ Australian chart of accounts to their global chart of accounts and ensured that all supplier and customer details were correctly entered.
  2. Inventory Management System: In selecting an inventory management system there was a need to not only integrate with the chosen accounting system, but also the third party warehouse management system and third party e-commerce platforms to avoid double handling of data. We recommended our client use a combination of the in-built Xero inventory system and Shopify due to the low upfront costs and familiarity with the platforms within the Australian market.
  3. E-commerce: We further leveraged Shopify as an inventory management system by setting up integrations with the e-commerce platforms’ Seller Center supplier portals. We also liaised with the third party warehouse team to set them up with a Shopify account to track inventory movements in and out of the warehouse in real time.
  4. Payments – We assisted the client to set up a bank account with NAB and set up payments and the approval workflow using the NAB Connect business banking platform. There were a number of small wholesale accounts introduced by the brand’s Australian sales agent that needed to pay for stock using credit cards. To facilitate this, we assisted the client with set up of a virtual merchant terminal with Square.
  5. Customer Service – The brand’s headquarters team wanted to run a lean operation in Australia until they had a few seasons of trade experience and understood how to adapt the brand concept to the Australian trends and consumer. They were reluctant to begin employing their own staff in Australia, due to the costs and compliance requirements associated with this. However, due to time differences, they needed a responsive local customer service function to deal directly with their Australian wholesale accounts. To meet this requirement we provided the client with a low touch customer service function including an accounts email address and contact number and dealt directly with various accounts on their behalf.

Ongoing Finance Support

We continued to support our client’s US based team to by taking on the end to end finance and operational responsibilities of the Australian business. This included the following:

  • accounts receivable and accounts payable;
  • end to end fulfillment of sales orders including shipping, inventory and warehouse management and liaising with customers and sales agents;
  • ongoing reconciliation of client accounting and inventory systems with customer e-commercemarketplace platforms such as THE ICONIC;
  • relationship management with the sales agents and commission calculations;
  • reconciliation of customer payments;
  • management of inventory markdown, customer charge backs and gross margin analysis;
  • first point of contact for customer service enquiries; and
  • Australian income tax and GST compliance.

Result

We designed, developed and delivered a lean, end to end solution to facilitate the client’s expansion into the Australian market. By outsourcing local establishment and operations to us, the client was able to test the Australian market without incurring a significant upfront investment. Once established our outsourced solution required minimal intervention from the client’s US-based headquarters team and resulted in a long-term partnership.

Key outcomes:

  • Complete system integration between accounting system, inventory system, logistics provider and e-commerce marketplace platform.
  • Lean operation allowed client to test new market with minimal upfront investment.
  • Leveraged cloud based systems to allow real-time access to key information for local and headquarter stakeholders.
  • Outsourced solution with minimal operational intervention from foreign headquarters team.