After Shark Tank Gives Convertible Heels Business A Lift, NetSuite Helps Pashion Footwear Take Off

Ian McCue, Senior Associate Content Manager

February 22, 2022

Many startup operations strive for that one big break to get their product noticed — an influencer, a viral video, recognition in the press. For Pashion Footwear, maker of high heeled shoes that can easily be turned into flats, that break came via an appearance on Shark Tank.

Founded in 2019, the company saw early success with its direct-to-consumer online model, increasing sales roughly 160% in 2020. That earned the company’s founder, Haley Pavone, an appearance on ABC’s “Shark Tank” last year. Sales of Pashion’s versatile shoes quickly followed; sales grew another 450% in 2021, but that growth created challenges of its own.

The idea of high heels that can turn into flats has crossed the minds of many women when their feet start to throb a few hours into a wedding reception or after a night out. But for a long time, it was nothing more than a fleeting idea. The only real solutions were to pack another pair of shoes in anticipation of the pain or go barefoot.

But then Pashion Footwear started selling shoes that turned the vision into reality. Pashion’s stilettos, pumps, sandals and booties all feature a removable heel to give users two shoes in one. With its patent-pending Stelo support system, customers unclip the heel with the push of a button, then twist and pull to remove it. Twisting on the cap completes the transition to a flat.

“I think one obstacle that most new businesses are up against, but especially ours, is the trust factor,” COO Jess Norman said. “Women have probably all, at some point in their lives, invented convertible high heels in the shower or when they’re walking barefoot home from the bar …

“We find that a lot of customers think that the concept is too good to be true and more of a gimmick than a tried-and-true, tested product. Being on Shark Tank catapulted our exposure and validity, because people now saw it as something that was real.”

 

Operational Issues Strain Small Staff

However, sudden success can bring significant challenges, particularly for young companies without the systems and processes ready to support it. Struggles with manual processes quickly become magnified. Issues with the customer experience become more frequent and potentially more high profile. Most of those complications arise from lack of automation and systems that can share the necessary information to deliver a unified view of the business.

Pashion is still a small company, with just eight employees, and as more customers discovered the brand it began to realize some of those growing pains.

Pashion made its items available for preorder, but its Shopify ecommerce system would not halt online sales when all inventory — tracked in a spreadsheet — was spoken for. That meant the company would oversell and have to cancel some preorders, leading to customer experience problems. Warehouse workers would also receive all of these orders and be confused about why there was no product available to fulfill them.

Shopify’s reporting posed other issues. It only allowed the retailer to see the performance of specific SKUs, not product categories or styles that could reveal important trends and inform demand planning.

And with information spread across Shopify, the QuickBooks accounting software Pashion was using and the inventory management system used by the company’s third-party logistics (3PL) provider, closing the books was slow and complicated.

Additionally, because there was no way to push product information from one system to another, employees spent twice as much time manually inputting these details into both the inventory and ecommerce systems.

Returns were another pressing issue in a retail segment with a notoriously high return rate. A warehouse employee had to review each request for a return and then manually process refunds or exchanges.   

“When you talk about 15% of your business being returns and exchanges, as you continue to grow, those numbers become unmanageable,” Norman said.

 

Leveling up the Customer Experience

To relieve what Norman calls the “sheer chaos” caused by this technology hairball, the company started looking for a system that could provide a single source of data and connect its back-end processes. The system also needed to integrate with Shopify ecommerce and Pashion’s case management solution to eliminate duplicate data entry and keep all systems up-to-date.

Although still a small operation, Pashion decided to invest in NetSuite because it had ambitious plans. With NetSuite, the company could unify inventory, orders (including returns), procurement and financials in one place and then integrate that system of record with outside applications as needed. That setup would automate basic processes and help leaders make better decisions faster with vastly improved reporting and real-time numbers.

“We really looked to NetSuite to be a solution that would be the source of truth for all of our information so that our controller could close the books in one place, orders could be managed in one place, and we could also have all of our styles prepopulated and set up in bulk,” Norman said.

Pashion chose NetSuite Professional Services to implement the system, and Norman leaned on her project lead’s extensive experience in the apparel, footwear and accessories industry to ensure the system would work as the retailer envisioned. That team was key to resolving integration challenges and setting up item structures in a way that would give Pashion all the reports it needed.

“One thing a lot of people forget is that as the customer doing your first implementation, you don’t know how all the decisions you’re making will eventually tie together at the finished product,” she said. “So having [the professional services team] at my side, able to guide me in a direction that was going to get me to the right place in the end, at the finish line, that was invaluable to me.”

With the help of her NetSuite project lead, Norman created a custom field in NetSuite that captures on-hand and on-order quantities for different products and populates that data in Shopify to prevent overselling. Once the on-hand number reaches zero, customers get an alert that they’re placing a preorder with a longer delivery timeline. A NetSuite saved search also gives the operations team a quick overview of all on-hand stock, incoming inventory and outstanding orders for each item.

Additionally, an integration between returns solution Loop Returns and NetSuite has simplified the returns process. Customers use a self-service portal to initiate a return or exchange, which then creates a pending return merchandise authorization (RMA(opens in new tab)) in NetSuite tied to the initial sales order. When the warehouse receives the returned goods, they’re immediately linked to the RMA number and added back to available inventory without any additional steps.

Finally, invoices are now automatically issued once the 3PL ships the order. On the payables side, all bills are processed through NetSuite partner Bill.com, but all of those payments are recorded in NetSuite to keep information up to date through a Bill.com to NetSuite integration.  

 

Building for an Omnichannel Future

In the last year, the business has received $1.6 million in funding and continues to raise money as it seeks to more than double sales again in 2022. The company is also considering international distribution.

With its newfound reporting capabilities, Pashion wants to better inform purchasing decisions with insights from customer data. For example, it can use that information to better predict not only what styles, but also what colors and sizes will be popular in future months.

At the same time, the footwear retailer is focused on profitability and finding ways to decrease the cost of goods sold(opens in new tab). With that in mind, it recently relocated its warehouses from California to Canada, where its goods are imported into a free-trade zone. They are then trucked across the border and shipped from Michigan, allowing the company to avoid duties and taxes on any individual orders below the de minimis value of $800. Previously, these fees amounted to about 18% of the inventory value.

“We’re definitely focused on high growth from a sales perspective but also managing costs and planning our inventory and demand accurately, which is something we haven’t been able to do up until now,” Norman said.

As Norman has become more comfortable with the system, she’s relied on NetSuite’s customer success team to help build new reports, get questions answered and discover other ways the system can help the business. She describes that team as an “incredibly valuable” resource.

Although Pashion’s products are currently only available through its own website, it’s considering opening branded pop-up stores and other omnichannel retail options. As it starts to add other channels, the ability to easily transfer products between locations will ease inventory complexities. And as Pashion becomes more of an omnichannel business(opens in new tab), it will be able to drill into the numbers to break down performance by item and channel.

That plan to reach more customers is supported by the fact that many Pashion customers return thanks to its proprietary heel technology. In fact, 45% of customers in December had shopped with the brand before. Now that the retailer has the right systems in place, it’s ready to spread the delight of convertible heels.

“We feel really optimistic that with the rest of the footwear industry trending downward in sales but us trending upward that we’ve got ourselves on the heels of something really big,” Norman said, pun definitely intended.

Learn more about NetSuite’s software for apparel, footwear and accessories.(opens in new tab)

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