Jacobson's Reshapes Alterations Department into Competitive Advantage

Quality is at the heart of Jacobson Stores' philosophy -- quality merchandise, quality staff, and quality customer service. It is the guiding principle for operating its 24 upscale, specialty department stores. Discerning customers will tolerate no less.

In Search of Savings: The Alterations Opportunity

Jacobson's recognizes that the total customer experience takes place on and off the selling floor. To round out its customer service offering, Jacobson's provides Alterations Departments in each of its stores. Typical to its peers, Jacobson's Alterations Departments are cost centers and difficult to manage.

For many years, Jacobson's retained outside help to supplement its internal Alterations management. In an attempt to better control Alterations costs, Jacobson's outsourced its ticket processing and Alterations reporting functions. Jacobson's received reports back -- but they were not actionable. "The reports arrived three to six months after the fact," explains Jim Ivester, Vice President of Operations. "There's just no way you can react to that." Therefore, the time and money invested added to the expense instead of helping to reduce it.

Frustrated by the lack of control his organization had over Alterations, Ivester was determined to find a solution that would truly reduce its Alterations expense, improve productivity and enhance service. "I knew we had a lot of savings opportunity in Alterations," he said. "Based upon a best practices comparison, I estimated that figure to be at least $500,000 per year -- plus additional improvements in customer service. As a company that is extremely cost-conscious and customer-driven, focusing on Alterations was long overdue for us. We simply couldn't ignore this important aspect of customer service any longer."

HEM-Line's Nine Month Payback

In order to gain greater control of its Alterations cost and productivity, Jacobson Stores chose to implement HEM-Line, the revolutionary alteration workroom management solution from New Century Information Services ("NCIS"). Jacobson's management felt this move was critical to its mission of offering quality merchandise and quality customer service. Based upon Ivester's initial savings analysis, Jacobson's will achieve a return on the project's total investment in just nine months -- in fact, the payback may be sooner. 

Unlike Jacobson's previous outsourcing arrangement, HEM-Line gives store-level managers the real-time tools to achieve the identified savings while simultaneously improving customer service. Its comprehensive and user-friendly reporting function enables Jacobson's to measure and monitor all aspects of its Alterations business in real-time; such as employee productivity, pricing integrity, garment completion status, and on-time performance.

Immediate Results

Ivester expected to see tangible results starting in February 1998, three months after the implementation began. However, he was pleasantly surprised...

"I thought during the December-January period we'd just enter the data correctly and really learn to use the system, and that we'd start keeping score in February. However, right away we started looking at the daily and weekly reports. We were surprised at the results we'd already achieved and the savings that we could identify. Store managers were asking, ‘Can this be true? If so, I've got a major problem in my store.' This realization at the store management level really facilitated their buy-in and motivated them to take action."

"We were astounded" by the savings - Using HEM-Line's reports, Ivester can now determine exactly how many labor hours each store truly needs to effectively run its Alterations business. By comparing this figure to the number of hours scheduled, Ivester identified significant labor savings opportunities, including productivity increases, overtime reductions, and staffing adjustments.

As he explains, "For example, at one store, HEM-Line helped me identify six peak alteration weeks of the year. With HEM-Line's help, it became evident very quickly where we could improve staffing. By managing our staffing at the appropriate levels, we will achieve $60-70,000 worth of savings at this store alone -- and I have 24 of them! Every single store looks like this one."

Customer service soaring with HEM-Line - To an Alterations Department, customer service means several things: promising garments in the fewest number of days, ensuring garments are ready when promised, responding immediately to customer inquiries, and quoting consistent prices. Already within the first two months of using HEM-Line, Jacobson's has realized drastic improvements in customer service.

"Our on-time completion rate went from around 50% to 95%, a 90% improvement. Our promise days dropped 56%, from an average of 16 days to an average of 7 days," explained Ivester. "Within a year, I expect to be offering 3 to 5-day Alterations which is unheard of in retailing. That's a big customer service improvement. You can't even begin to put a price tag on that."

At the store level, Adina Fisher, Workroom Manager at Jacobson's Grosse Pointe, MI store, is relieved by these improvements. "It's very embarrassing when a customer comes to pick up their garment and it's not done. I dread having to say, ‘I'm sorry, your garment isn't done,'" she admits. "But now those situations rarely occur. HEM-Line helps us plan our daily activities to ensure we finish all of our garments on time."

She is also excited about HEM-Line's garment tracking capability. "Now when the customer calls, we can tell her right away that the garment is done, or if it is close to being done," Fisher explains. "Without HEM-Line, we had to search through our paper files to find the document and then search the rack to find the garment. That took 10 minutes but using HEM-Line it takes less than a minute. We're happy not to go through the stress of finding the garment, and the customer is happy not having to wait so long!"

Furthermore, by providing Jacobson's the capability to enforce its corporate pricing policy, HEM-Line has helped create pricing consistency both within and across stores. Fisher claims that without HEM-Line, each fitter basically made up his or her own price. "She thought about how long it would take and then made up a price," she explains. "Well, you can't do that anymore. The prices have to stay constant so the customer is not surprised the next time she comes in and the same alteration costs more."

HEM-Line facilitates "found" revenue - In addition to cutting costs and improving service, HEM-Line has enabled Jacobson Stores to increase revenues by reducing unnecessarily waived alteration fees. HEM-Line identifies those sales associates that abuse the fee waiving policy. "While I don't have a lot of waived fees on my HEM-Line reports, I can see that my revenues are going up," Ivester explains. "That tells me that just the fact that the sales associates know a tracking system is now in place has immediately changed their behavior. They are waiving fewer fees. This is something we stressed in training."

Implementing HEM-Line: Quick and Simple

During November 1997, NCIS and Jacobson's together rolled-out HEM-Line to each of the 24 stores. The Store Manager, Operations Manager, and Workroom Managers of each store participated in a two-day, hands-on training program. HEM-Line's unique design proved extremely easy to use-- -- even those trainees with no computer experience picked up the system quite easily.

Fisher agrees. "It's real easy -- and I had never even touched a computer before," she contends. Fisher also believes the training was successful in teaching why to use the system as well as how. "Understanding the reasons for the system is important because you know what the information is doing and why it's there."

A First-Class Business Partnership

"New Century Information Services is a very professional company," said Ivester. "I don't know of anybody who would have been more involved or more responsive-- -- and would have done a better job. I look forward to a successful, long-term partnership with NCIS. With these early signs of success, I have no doubt Jacobson's will reach the goals we set out to accomplish, if not surpass them."

Related links:

Support Menu Product Menu

Top