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Epitaph Records Case Study: Epitaph Records Overview Like many record labels, Epitaph has had to evolve as music streaming and downloads have overtaken physical sales. The business was struggling to extract sales performance insight from reports detailing hundreds of thousands of micro-transactions from popular music streaming platforms. With its legacy system no longer fit for purpose, the label chose SAP Business One, version for HANA, to modernize its business and analyze data at speed and scale. Objective To be able to generate insight from Rapid processing of hundreds of thousands of lines of data millions of lines of data from popular music streaming platforms, and calculate royalties. Solution Ability to track SAP Business One, version for SAP HANA performance by artist or streaming platform Organization Based in Los Angeles and with offices in Europe and Canada, Epitaph Records is an independent music label founded in More accurate royalty the 1980s by Bad Religion guitarist, Brett calculations and forecasts Gurewitz, inspired by the King Crimson lyric “Confusion will be my epitaph”. From its origins as a punk label, today Epitaph boasts a diverse roster of artists and 7 gold and platinum records. Why SAP Business One? “We had an aging system that handled some of our information requirements, The challenge for the whole music but not the streaming data, so that was all industry over the last decade has been “SAP Business One on HANA is done manually,” recalls Barry. “Every three trying to find a workable revenue model. extremely fast. That’s the months, I would compile a spreadsheet As Barry Reynolds, Epitaph’s Finance shocking part - how quickly it which another member of the team Director explains, “With the advent of would use to calculate royalties, but it was can grab all this information.” streaming, revenues dropped industry- a tedious, manual process. We recognized Finance Director, Epitaph Records wide as CD sales declined. In the last the imperative to modernize our three years since streaming has hit mass- software. SAP Business One came highly market adoption, the industry has seen recommended by a consultant that works revenue growth for the first time since with us, and looked like the perfect fit with “We also make wider use of SAP Business the early 2000s.” our business needs at the right price point.” One in our day-to-day activities, such as receivables, payables and inventory. “Our challenge in this new economy is Purchase orders are a breeze in SAP that instead of physical sales of CDs and The Benefits Business One, whereas with our LPs driving performance, we now have “We receive monthly sales reports antiquated legacy system, we had to do micro-transactions of half a cent per from various partners such as Spotify, a lot of workarounds. Once a month, we stream. So whereas the monthly sales Amazon, Apple and Google, which are all update our forecast for the year based on reports from a physical distributor would imported into the SAP HANA database the sales information pulled from HANA, consist of 3,000 to 4,000 lines, a Spotify for crunching – a process that used which gives us greater accuracy,” he adds. report typically has 800,000 lines. We to take half a day and now takes half needed a solution that could handle that an hour, freeing up my time for more “We did have one custom requirement kind of volume and turn the data into a purposeful activities. I can then put that that SAP Business One couldn’t deliver usable reporting format.” data to work for all different kinds of out of the box, as our CD and vinyl LP reporting scenarios, such as looking at manufacturing process introduces a P&L by artist, or determining the biggest degree of complexity. We needed to artists on each streaming platform. be able to monitor our inventory of “SAP Business One came What’s shocking is how super-fast it is – components in the warehouse as well highly recommended...and SAP HANA handles sales files containing as stock of finished goods. It took a little looked like the perfect fit with 30 million lines of data with ease. I can programming to achieve, but Sapphire our business needs at the grab all the information I need, quickly gave us the functionality to calculate sort it by artist or project, and export to right price point.” accurate costs and put finished goods Excel or a PDF in a couple of clicks for into scalable items with a Universal Finance Director, Epitaph Records use with our royalty accounting software,” Product Code.” enthuses Barry. Working with Sapphire “We were the first record label to implement SAP Business One on HANA, and ours is such a unique business model,” Barry explains. “When we initially started working with Sapphire, we had lots of intensive meetings involving various people, so they could learn about our business and align SAP Business One to our specific requirements. We developed a wish-list which we refined into immediate priorities and ambitions for a later date.” “We embarked on a phase of data preparation and test dumps from our legacy system, to ensure a smooth migration when the time came. Ongoing, we have a check-in with Sapphire every three months, which allows them to deal with any issues or questions that arise, and create any reports we might need as our requirements evolve.” “From our experience, the key to a successful SAP Business One project is to pick a good partner who will listen, understand what your company is all about and any specific considerations, and prepare you for implementation. With SAP Business One and Sapphire behind us, it’s all worked out really well,” concludes Barry. www.sapphiresystems.com.
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