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Why Dassault Systèmes Matters To Retailers

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Last week I had the opportunity to attend Dassault Systèmes annual analyst days outside of Paris. You may think Dassault Systèmes is all about building airplanes and pharmaceutical devices, but in fact the company is a whole lot more. A LOT more. And some of that “more” includes big opportunities for retailers and brand managers.

The event was timely, as we live under the constant threat of new tariffs on the products retailers buy from China and Mexico (and who all knows where else). A wise brand manager – whether a retailer selling private label merchandise or a supplier to the industry – will hedge their sourcing and product development bets. To do this, specifications have to be tight, easy to understand and clear.

Dassault Systèmes has really grown to be a contender in the space.

The company has built out from its core product base to a point where it now is in eleven industries and owns eleven different brands. That brings me to my first surprise. The day we arrived, Dassault Systèmes announced the acquisition of Medidata, a life sciences PLM company, for six billion Euros. That’s a lot of Euros and a real premium against Medidata’s revenue. Medidata itself reported annual revenue of $.636 billion in 2018. Before the acquisition, in 2018, Dassault had annual revenue of 3.77 billion Euros, so this represents real growth and expansion. It required taking on ladder bonds and debt in general. That’s a big bet.

But we’re here to talk about retail, and Dassault Systèmes’ footprint in the retail industry is quite impressive. I don’t think the company gets nearly enough press for its offerings in the US, and it’s about time that it did.

Dassault Systèmes has broadened its suite predominantly through acquisitions, although some of the applications were developed by the company itself. Certainly the platform all these applications ride on, the 3DEXPERIENCE platform is shared among them all and was developed in-house.

You may not have heard about Dassault Systèmes, but you have likely heard of Centric Software, a PLM system that has expanded from pure apparel to other retail segments. You probably also haven’t heard about the innovation Dassault Systèmes has developed with Ecco shoes, to create customized mid-soles for its shoes. This is a very cool looking technology, and you can get a peek at it here.

I was impressed by Dassault Systèmes’ commitment to sustainability (and using its products to help analyze ecological challenges), its commitment to women (at least three different executives highlighted the number of women invited to the event, the number of women in corporate management, and internal promotion of women within the company), and its general commitment to being a good karma company.

All of that is good stuff, but what’s most important is to understand why PLM really matters now to retailers.

We tend to think of PLM as important for products that are highly engineered: sneakers, running shoes, electronics – products whose parts really do have to work together in a cohesive whole. The earliest adopters of PLM were, in fact, sneaker companies, who tend to iterate on existing styles, and whose products must be properly engineered for the function they are to serve.

But, as I said earlier in this piece, product consistency is extremely important even in less highly-engineered products. If your goal is to create an initial order from China or somewhere else in the Far East, and then replenish as needed from a factory closer to the point(s) of demand, a PLM system is an imperative. No debates. No arguments. These are the specs. Period. A PLM system is really necessary to do that.

And in an age when every retailer and brand manager wants to push the “go faster button,” a PLM system is imperative. Designs can be visualized and iterated faster, and there can be a real sense of what the final product is going to look and feel like, without passing samples back and forth ad infinitum.

I was grateful for the opportunity to attend this conference, and I’m even more grateful to get back on my soap box and say once again: Retailers who develop their own private label, and brand managers, you really do need a PLM system. Those piles of spreadsheets you currently use aren’t going to help you push the go faster button, and they won’t help a lot if you’ve got to pivot quickly, based on the politics of the day.

You need PLM. And Dassault Systèmes is innovating to insure they can be one of your options.

This was a really interesting event, for sure. I will continue highlighting the reasons why I think PLM is important for our industry in the coming months. Because frankly, this is something we all need to hear and internalize. In the nuts and bolts of retail product design, PLM is a must.

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Articles & Opinions June 18, 2019
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