CASE STUDY
FAM Brands
10% net profit increase with AI-driven markdown pricing
FAM Brands in a nutshell
Established in 2000, FAM Brands specializes in designing, producing, and distributing activewear for both men and women. Their distribution strategy is omnichannel-based. They sell their brands through major retailers, large department stores, and in their D2C shops. FAM Brands trademarks are Marika, Wildfox, Three Dots, Zobha and Ellie.
- Fashion
- E-commerce
- Global business
Net profit increase
Time saved in pricing
Number of SKUs managed
THE CHALLENGE
The main challenge for FAM Brands was to optimize their product lifecycle pricing.
Another big pain point for FAM Brands was the large number of SKUs and the small team to manage them.
Decline in gross margin
FAM Brands faced a decline in gross margins due to inflation and had to develop solutions to increase profitability. The company evaluated different pricing strategies to raise prices without negatively impacting conversion rates and their overall business. One solution implemented was selectively increasing prices on items having higher demand, and reducing prices on items that created a higher sales volume.
Managing SKU's
THE SOLUTION
FAM Brands uses the Sniffie AI-Driven Pricing Tool for profit optimization and markdown pricing campaigns. The team, comprising several users, plans and executes AI-driven markdown campaigns as products near the end of their lifecycle. Additionally, the team utilizes Sniffie’s AI to optimize product prices for maximum overall profit.
THE RESULTS
When we asked Justin how Sniffie has helped them solve their challenges, the answer was clear:
“It has definitely made it easier for our merchandisers to perform their daily activities. It has increased our gross profit by about 10%, and our net profit by just about 10% as well which is really powerful, it has almost doubled our net profits.”
Net profit increase
Time saved in pricing
Number of SKU's managed
“Sniffie has definitely made it easier for our merchandisers to perform their daily activities. Sniffie’s product has increased our gross profit by about 10%, and our net profit by just about 10% as well which is really powerful as it has almost doubled our net profits.”
Justin Zarabi
Director New Business Development, FAM Brands
WHAT FAM BRANDS USERS LIKE IN SNIFFIE
When asked “How have you liked the product so far?” Milton Ramirez, super user of Sniffie from FAM Brands added:
“I agree with Justin, the beginning stages were the difficult ones, trying to learn something new, in this case with AI. But like Justin said the product does serve its purpose. The product has better facilitated my time as a merchandiser at our end in terms of managing our products at a mass level, and just being able to edit them at a mass level saves a lot of time when I can make changes to a whole group of products in a matter of seconds, although it was time consuming in the beginning during the learning process. It is very beneficial at my end as well.”
…and Justin:
“And it used to be very time consuming having to think what’s the optimal price for this product (x) should I reduce it, should I not reduce it but with this tool we’re able to outsource the decision making to the tool and we don’t have to break our head on it.”
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