The Company

Established in 1838, David Jones opened its inaugural fashion store, marking the beginning of its journey as one of Australia's premier and most iconic department stores. With a commitment to ‘inspire like no other’, David Jones recently celebrated its 185th anniversary. Renowned for delivering superior products and services, David Jones showcases a diverse range of national and international brands in fashion, beauty, food, and homewares. Boasting over 40 physical stores and a thriving online presence, David Jones continues to captivate customers with its quality offerings.

Juanique Vorster serves as the subject matter educator at David Jones, leveraging her extensive 25-year career in retail. Approximately half of her responsibilities involve training the staff at David Jones across various systems that are integral to business operations. With a need for an in-depth understanding of the diverse systems in use, Vorster plays a crucial role in ensuring that the workforce is well-versed in their functionalities. One noteworthy aspect of her responsibilities involves overseeing Enable’s rebate management system, emphasizing the importance of her role in managing and optimizing this critical aspect of their retail business.

Rebates Are Critical to the Retail Industry

The concept of rebates plays a pivotal role in fostering partnerships and collaboration within the context of product offerings to customers. Historically, rebates were often perceived as straightforward and lacking nuance, serving as a somewhat blunt instrument without significant associated rewards. However, in the case of David Jones, a prominent fashion business, the dynamics are now different. Given the inherent seasonality of fashion products and the extensive branding involved, their approach to rebates has become more strategic.

Developing a Mature Rebate Strategy

David Jones has traversed a considerable journey in developing a mature rebate strategy. The initiation of this journey dates back to 2014 when the company adopted a rebate management system, a step taken by only a limited 10% of companies in Australia. This underscores the pioneering nature of David Jones in adopting advanced rebate management practices. While historically rebates were somewhat rudimentary, the real evolution of the rebate strategy occurred post-2017/2018.

Vorster comments, “During this period, David Jones actively worked on refining and expanding its rebate strategy, delving into the potential for collaboration and shared partnerships. We allowed the rebate management system to evolve alongside our strategic objectives. This evolution involved the introduction of new vendor trading terms and calculatable terms into the system. These terms are instrumental in creating a seamless process for collecting and formulating agreed-upon terms with vendors.”

Vorster continues, “The integration of these terms ensures a streamlined flow of information to the accounts payable and VSO (vendor support office), facilitating the effortless execution of payments in accordance with the collaborative terms established with vendors. This dynamic evolution showcases David Jones' commitment to staying at the forefront of rebate management practices and fostering mutually beneficial partnerships with its vendors.”

The Software

Migrating from Profectus RDM to Enable

David Jones' transition from legacy system Profectus RDM to Enable marks a significant shift in the realm of rebate management. With Enable having acquired Profectus RDM in 2022, this move reflects the dynamic landscape of global rebate management.  

As the company finds itself in a transitional phase, the initial conversations with Enable have laid the groundwork for understanding the capabilities of the new platform compared to their previous system. Given David Jones' maturity in the realm of rebates, the migration strategy is envisioned as a staged approach. Early discussions have revolved around comprehending the specific requirements of David Jones, an essential step before initiating the building process. A key aspect of this migration journey involves identifying opportunities for improvement. David Jones envisions not only meeting its existing requirements but also exploring enhancements.  

Vorster comments, “There's a strong focus on shared documentation and collaboration with vendors, with the goal of creating a platform where both parties can access and interact with the same data and documentation. This collaborative approach aligns with David Jones' commitment to transparency and efficiency in our rebate management processes.”

Forming Stronger Ties with Vendors

Vorster explains, “The most substantial advantage Enable presents over the current system lies in its capacity to open up the system to the vendor community. This aligns with a long-standing aspiration within David Jones to establish a unified platform that can be shared with vendors. The platform will provide a common ground where both David Jones and its vendor partners can access and interact with the same set of data. This level of transparency and collaboration is deemed crucial for optimizing joint efforts, streamlining communication, and ensuring a harmonious partnership between us and our vendors.”

Managing Seasonality and Profitability

David Jones operates with over 1,200 brand affiliations, curating a collection for each brand. This curated approach is based on collaborative efforts, considering the seasonal nature of fashion and the unique identities of the brands. Rebates are used as a tool to foster dynamic partnerships that align with the fashion industry and the diverse range of brands represented by David Jones. During key retail cycles like Black Friday or Boxing Day sales, David Jones negotiates and collaborates with vendor partners to create shared income arrangements tailored to these specific periods.

In the realm of profit margins, especially during promotional and end-of-season clearance periods, it's evident that margins are likely to decrease. This is particularly pronounced in the fashion industry, where the end-of-season clearance holds significance for a seasonal business, like David Jones. During these clearance periods, when products may not perform as expected, the impact on profit margins can be substantial.

Recognizing the challenges posed by these situations, David Jones places a strong emphasis on collaboration with its vendors. The ability to negotiate and collaborate becomes crucial, especially when faced with instances where products don't achieve the anticipated sell-through rates or fail to meet performance targets. In such cases, the collaboration allows for negotiations that can result in the return of funds to the business, specifically earmarked for clearance efforts.

Vorster explains, “By taking a collaborative approach we can strategically manage the financial impact of end-of-season clearance, mitigating the challenges posed by products that may not have performed as planned. By engaging in discussions with vendors and negotiating terms that align with business objectives, David Jones can not only navigate the complexities of seasonal variations but also positively influences the bottom line. The overarching goal is to achieve mutually beneficial outcomes, fostering success not only for the vendors but also for David Jones in terms of increased sales and profits.”

Vorster continues, “By embracing the Enable platform, we anticipate an enhanced ability to facilitate negotiations, share insights, and collectively navigate the intricacies of seasonal and promotional activities. This shift toward a more collaborative and transparent approach reflects the company's commitment to forging stronger ties with our vendor community, ultimately contributing to the success of both parties during key retail events.”

Consistent and Standardized Approach to Negotiations

Due to the considerable experience and time invested in their rebate strategy, David Jones is now poised to enhance its governance structure. The aim is to establish a more consistent and standardized approach, fostering stronger negotiation practices and facilitating the creation of templates for teams to utilize during retail trading discussions. This involves defining clear terms and establishing criteria for additional considerations.

Vorster tells us, “The ultimate goal is to provide our team with a cohesive and consistent framework for trading terms. This approach not only streamlines governance but also simplifies reporting and rebate management processes. By ensuring a standardized set of trading terms, our aim is to bring greater clarity and efficiency to our rebate strategy. This strategic move toward governance reflects a commitment to continuous improvement, enabling us to navigate negotiations more effectively and manage the rebate process in a transparent, reportable, and manageable manner.”