Billabong ditches NetSuite in omni-channel overhaul

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Billabong ditches NetSuite in omni-channel overhaul

Bears $11.7m impairment charge.

Retailer Billabong has decided to cut its losses and dump its new ecommerce platform provider NetSuite following technical implementation issues.

The company today revealed it has terminated the agreement that it signed in 2015 with the vendor for its SuiteCommerce cloud-based set of ecommerce and retail point-of-sale tools.

The platform was intended to consolidate disparate and regionally-based global systems with one platform that provided a single view of the customer.

Billabong initially expected the global rollout to be complete in mid-2016.

But this February it revealed the launch of the new ecommerce and PoS systems had been delayed following unidentified technical implementation issues that arose during user acceptance testing.

CEO Neil Fiske at the time said Billabong was in ongoing discussions with the vendor to solve the technical issues and "improve the resourcing and oversight of their project team, and deliver against their promises and contractual obligations".

He said Billabong had requested a comprehensive corrective action plan, and was "disappointed" at the delay.

Today the company revealed it would book an $11.7 million impairment charge at its upcoming FY17 results as a result of the contract termination.

It is unclear whether Billabong has appointed a new vendor to take NetSuite's place; in a statement it referenced "the change in service provider" and said it expected the "first of our new ecommerce websites" to launch before the end of the calendar year.

Billabong said it was still expecting to deliver its omni-channel transformation "materially close to its original range of budget expectations" by accelerating implementation through "advancements in cloud computing and best in class technology".

A spokesperson declined to comment ahead of a promised update on the omni-channel overhaul at Billabong's August 30 full-year results release.

Other aspects of the transformation program - spanning B2B, retail planning and allocation, consumer engagement and database marketing - were progressing well, Billabong said in February.

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