BRINGING THE POWER OF IN-MEMORY COMPUTING INTO

RETAIL PLANNING & SUPPLY CHAIN SOLUTIONS

Johan Haataja, Group CFO, RELEX Solutions

Kadehdittava Kasvuseminaari 17.5.2016

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Agenda

• Background and RELEX today

• A few lessons learned

Background – founded in 2006 3

• Founded in 2006 by three leading SCM researchers from Helsinki University of Technology: Michael Falck, Johanna Småros and Mikko Kärkkäinen

– Among global leaders in building SCM theory

• A significant international market gap was identified

– European level benchmarking on best practices in retail forecasting and replenishment

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• RELEX provides comprehensive solutions for supply chain management, optimization and retail planning– Forecasting and demand planning– Automated store replenishment and inventory

management– Retail planning – Actionable analytics and reporting

• Wide international customer base– Over 120 customers in 18 countries– Customers in retail, wholesale, and manufacturing

• Market leader with a clear technology edge– Market leader in Northern Europe– The fastest growing supplier of SCM solutions within

the EMEA region on Deloitte’s Technology Fast 500 2011-2015

– Patented in-memory database technology which provides 100-1000 x better calculation performance compared to traditional disc-based alternatives

RELEX today

Hundreds of warehouses, tens of thousands of stores, hundreds of millions of SKUs, and billions of euros are

managed with RELEX’s software.

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Team of 200 employees in 10 international offices

Atlanta, US

Helsinki, Finland (HQ)Oslo, Norway

Stockholm, Sweden

London, UK

Cape Town, South Africa(partnership)

Wiesbaden, Germany

Copenhagen, Denmark

Venice, Italy

Lille,France

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Solutions delivered on the RELEX software platform over the cloud

Inventory managementInventory and cost optimisation in the entire supply chain; efficient replenishment and exception management

PromotionsPlanning, execution and analysis of promotions and marketing activities; management of shelf presentation

AssortmentModular approach to creating uniquestore assortments; monitoring of dead stock/slow movers, profitability and trends in sales

PlanningLong-term forecasting, demand and supply planning, Retail S&OP with capacity planning, collaborative planning

In-Season ManagementPrepack calculations, efficient allocations and mark-down optimisation

We have managed to achieve fast, profitable and cash flow positive growth

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0

1 000

2 000

3 000

4 000

5 000

6 000

7 000

8 000

9 000

10 000

11 000

+51,2%

2015201420132012201120102009200820072006

Revenue

CAGR

# of employees(end of year)

9 18 24 30 42 55 65 101

k€

4 170

Average EBIT 8,7 % in 2011-2015

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Summer 2015: 20 M€ minority investment from Summit Partners

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Agenda

• Background, history and RELEX today

• A few lessons learned

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Don’t fear to go international

• Estimated market potential forRELEX’s solutions:

• RELEX’s internationalization began around 2010 when we decided to make a bold investment of 100 € in flight tickets to Stockholm

– We could have done this a few years earlier

• In enterprise software market it usually pays off to hire local sales force

– We tried first the other way

25 M€

in Finland

Outside Europe

1 300 M€in Europe outside Finland

1 700 M€

Tot. ~3,0 B€

Focus on customers and customer value

• Our customer churn is almost 0 %• Customer focus in everything we do• We create measurable value for our customer

With our software our customers achieve a bottom-line impact of up to millions of euros (and ROI measured in months)

RELEX Value Promise

• Risk-free SaaS

• No heavy upfront investments

• Rapid and reliable: Quick results

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Business model win-win for both customer and RELEX

RELEX Big Data Technology

• Columnar database

• In-memory analytics

• Business rule engine

• Patented technology

RELEX Agile Projects

• Rapid specification phase

• Adaptation on the fly

• Best practices

• Experienced professionals

RELEX Value Promise

• Risk-free: SaaS and pilot

• Flexible: Adjust yourself

• Rapid and reliable: Quick results

SaaS= Low upfront investment and rapid payback time for customers= Solid and predictable revenue flow for RELEX

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Differentiate from competitors

Gartner “Cool Vendors in In-Memory Computing Technologies, 2014”, Pezzini M, Unsworth J, Payne T, Reitz M, Edjlali R, 11 April 2014Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings. Gartner research publications consist of the opinions of Gartner's research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

*

Nextgeneration:In-memory

Traditional:Disc-based

Business intelligence& analytics platform

Supply chain planning, manufacturing

Supply chainplanning, retail

SAP BWCognosOracle Hyperion

QlikViewTableauPowerpivot

ForecasterSAP SOP on HANAOracle on Exadata

SAP APOJDA Manugistics & I2Oracle DemantraTools Group

JDA AWR & ASRTools GroupAGR InventoryJustEnoughSlimstock

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Take advantage of public funding opportunities

• Some examples RELEX has benefited from during the journey

– Tekes NIY program, grant of 1,0 M€

– EU Horizon 2020 program, grant of 1,4 M€

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Ensure great company culture

• Often growth companies seem to face challenges when they have reached a size of 30-50 employees

• What we have been focusing on:- Focus on recruiting the right types of persons- Enable fast decision-making also at the lowest level- Knowledge management (e.g. onboarding and internal trainings, knowledge centers)- One RELEX - shared company culture across all our offices

Result: A talented, happy and committed team rowing steadily towards a shared vision!

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Thank You!