1/12/2017

MemeboxbeautyproductsgrowwithSAPS/4HANA

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Case Study

Memebox Loves Its Makeover

Beauty Products Start-Up Takes Off with SAP S/4HANA

byKenMurphy,SeniorFeaturesEditor|insiderPROFILES,Volume7,Issue3
August11,2016

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KoreanstartupMemeboxstartedsimplybutsoonbegangrowingatanexponentialrateestablishing
uniqueproductlines,ecommerceplatforms,andretailstores.ItdidnttakelongforMemeboxtorealize
thatifitwantedtokeepupwithcustomerdemand,itneedednewtechnologycapabilities.Butasasmall,
fastgrowingstartup,thecompanyneededanoutoftheboxsolutionthatcouldgrowwithit.Discoverhow
MemeboxallowedforgrowthwhileimprovingitsinventoryaccuracyandincreasingitsrevenuewithSAP
S/4HANAFinanceonanSAPHANAEnterpriseClouddeployment.

ReimagineDigitalBusinesswithInMemory
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withSAPHANAVora(HANA2016)
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Platform

Memebox,abeautycarestartupfoundedinKoreain2012,veryquicklybecameoneofthetopecommerce
beautycaresuppliersinthecountrybypackaginganddeliveringsomeofthemostpopularbrandsonthe
market.Devotedcustomershungryforthelatestmusthavelipsticks,eyeliners,andothercosmeticsledto
rapidgrowthforthecompany.
Likemanystartups,scalinginaccordancewitharapidlygrowingcustomerbasequicklybecameachallenge
forMemebox,andthefledglingcompanyrealizedthatitwouldneedatechnologypartnertosupportits
acceleratedgrowthtimeline.Becauseitwasreinventingitsbusinessmodelontheflyaddingane
commerceplatform,launchingitsownproductlines,andopeningretailoutletsondemandprovisioning
withacloudinfrastructuremadethemostsense.Withjust150employeesandlimitedITbusiness
infrastructure,thebusinesscouldntjustifythecapitalexpenseofowningandoperatingitsowndatastructure
andlargescaleonpremiselandscape.Movingtothecloudwastheidealsolutionfortheorganization
madeevenmoreidealwhenthenewecommerceplatform,whichservedastheimpetusforcreatingitsown
privatebrands,turnedMemeboxintoadatadrivenorganization.
Thewebandmobileplatformshavebeenabigsuccessandareamongthebiggestbeautyplatformsin
Korea,saysJasonKim,GlobalFinanceDirectoratMemebox.Fromthoseplatforms,wewerecollectingall
kindsofvaluabledataaboutcosmeticpreferencesandhowpeoplemaketheirpurchasingdecisions.For
example,weknewiftherewasademandforacertaincolorlipglossthatwasntonthemarketandthen
wecouldcreateitandgotomarketfasterthanourcompetitors.

Memebox
Headquarters:SanFrancisco,California(US)Seoul,SouthKorea(APAC)

http://sapinsider.wispubs.com/Assets/CaseStudies/2016/August/IPBeautyProductsStartUpLovesItsMakeover

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MemeboxbeautyproductsgrowwithSAPS/4HANA

Industry:Consumerpackagedgoods
Employees:400+
Companydetails:
FoundedinSeoul,SouthKorea,in2012
PronouncedMiMiBox
AcceptedintotheYCombinatorstartupprograminDecember,2013(Fundingstartupssince2005,Y
CombinatorgraduatesincludeDropbox,Wepay,Checkr,Docker,andAirbnb)
PrivatebrandsarePonyEffect,Bonvivant,Nooni,andIMMeme

SAPsolutions:
SAPS/4HANAFinance
SAPHANAEnterpriseCloud

StartingwithaBaseLayer
Becomingaproductmanufacturerwithintwoyearsofthebusinesslaunchdrovehometheneedforan
infrastructuretoimproveinventoryaccuracy,increaseinsightintologistics,andestablishafoundationfor
globalexpansion.Atthetimeofitsinception,Memeboxpulledcustomerdataandranaccountingsoftware
throughalocalizeddatabaseandusedstandalonespreadsheetsforreporting.Wedidnthaveaspecific
businesssolutionotherthanasimpleaccountingprogram,saysKim.Wejustextractedbasic,rawdata
fromourserverandmanuallycreatedreportsthatwereusedasthebasisforourdecisions.

Tuesday, January 17
Webinar:ConsideringYourSAPHANA
Implementation?HowtoReduceCosts
andOptimizePerformance

Thursday, January 19
Q&A:LiveQ&A:Takethestressoff
yourSAPAccessControl10.1
implementation

Monday, February 27
Conferences&Seminars:HANA2017
Conferences&Seminars:BI2017
Conferences&Seminars:Basis&SAP
Administration2017
Seemore

Tosupportthegrowingenterprise,MemeboxturnedtoSAPS/4HANAFinance,goingliveinfivemonths
withthebestmodelcompanyapproachonSAPHANAEnterpriseCloud.Weneededasolidbusiness
structuretosupportourdailyoperations,andwechoseSAP,inpart,becauseofitsreputationforproviding
thefoundationforagrowingbusiness,saysKim.DeployingthebestmodelcompanyapproachwithSAP
HANAEnterpriseCloudalsomeantwecoulduseprebuiltprocesses,ratherthanstartingfromscratch,and
wecouldimplementitinacondensedtimeline.

OutoftheBoxBusinessInfrastructure
SAPprovidesApplicationManagementServices(AMS)fortheprebuiltprocessesinthebestmodel
companydeployment.WithAMS,Memeboxdidnothavetodesignateresourcestosupporttheapplication
atgolive,anditcouldleavedaytodayoperationalsupporttotheAMSteamforbothfunctionaland
technicalaspects.
ThismeantMemeboxcouldfocusongrowingthebusiness.SincegoingliveonSAPS/4HANAFinancein
January2016,MemeboxhascontinuedtoexpandtotheUSandChina(USoperationsarebasedinSan
Francisco),hasmostrecentlybegunexpandingintoHongKong,Singapore,andTaiwan,andhasopenedits
firstretailoutlet(inKorea).
PrebuiltprocessesonSAPHANAEnterpriseCloudincludefinancialplanningandanalysis,accountingand
financialclose,treasuryandfinancialriskmanagement,andenterpriseriskandcompliancemanagement.
Memeboxusedthisoutoftheboxfunctionalitytodriveimmediateimprovementforvalidatingthirdparty
vendorsettlements,whichhadpreviouslybeendifficulttotrack.
Inventoryaccuracyhasincreasedsignificantly,andthathasbeenoneofthebiggerpointsofsuccess,says
Kim.Bytrackingourinventorymoreaccurately,wecanbetterforecastdelivery.Analyzinginventorybecame
veryimportantwiththegrowthofourecommerceplatform,andwecouldntdothiseffectivelywiththe
previoussystemwehad.

AddingSomeAccents
Memeboxssituationwassomewhatuniqueinthat,atthetimeofgolive,thecompanywasstillrathersmall
andknewthatitwouldneedtogrowintobothitscloudinfrastructureaswellastheapplicationitself.Our
expectationistohaveinthevicinityof500employeesbynextyear,butwehadlessofaspecific
understandingforhowwewouldgrowintobusinessprocesses,Kimsays.Weknewweneededaflexible
toolthatwouldoffersupportacrossmultiplesaleschannels,butatthesametime,theSAPimplementation
camewithalotoffunctionalitythatwedidntneed.
UsingprebuiltservicesinSAPS/4HANAFinancedidnotmean,however,thatMemeboxwasrestrictedto
modelingitsbusinessprocessestotheprebuiltmodel.AccordingtoKim,thisfreedomdidcreatesome
complicationsduringthefivemonthimplementation.TheSAPteamwouldmakeananalysis,wewould
alignourcurrentprocessaccordingly,andthentheywouldstartthedesignbasedonwhatwetoldthem,
explainsKim.Butbeforeitwouldbecomplete,thebusinessprocesshadevolvedandmadeoperational
changesforexample,implementingapolicychangetoacceptreturnsfromallvendors.ButtheSAPteam
wasveryflexible,workingcloselywithustomakethenecessaryadjustments.

AFinishedLook
InsixmonthssincegoingliveonSAPS/4HANAFinanceinSAPHANAEnterpriseCloud,Memeboxhas
experiencedadramaticincreaseinsalesproductivityandamuchshorterdeliveryleadtime.Muchofthese
gainsinefficiency,accordingtoKim,canbeattributedtotheimprovedinventoryaccuracymadepossible
withtheinmemorySAPHANAplatform.Withrealtimetracking,weknowinrealtimehowmany
productswehave,hesays.Before,weweresellingproductsthatmightnothavebeenreadilyavailableto
send.
MemeboxopeneditsfirstflagshipstandalonestoreinoneofthetrendiestareasinKoreainJune2016.
Expansionplansincludelaunching15storesbytheendoftheyear,includinginTaiwanandHongKong,and

http://sapinsider.wispubs.com/Assets/CaseStudies/2016/August/IPBeautyProductsStartUpLovesItsMakeover

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MemeboxbeautyproductsgrowwithSAPS/4HANA

developingagreaterpresenceintheUSandChinesemarkets.Therearetentativeplanstoimplementa
franchisingmodel,whichcouldyieldroughly100storesgloballyby2017.
Nothinghasbeenconfirmed,butwewilluseSAPsoftwaretohelpusgrowglobally,includingsolutionsfor
retail,saysKim.Whenwefirstconsideredtheneedforabusinessinfrastructure,ouroriginalimpression
wasthattheSAPimplementationwouldtakeayearormore.Butthesuccessthatwevehadinthecloud
helpstoprovethatSAPsoftwarecanbeaverygoodbidforstartupslikeus.

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