The module offers solutions to companies of all types, whether those that are dedicated to property management or those where, even though such management is not their core business, their business relies on the use of spaces that it is important to manage properly because of their cost relevance, pursuing their optimisation and spending rationalisation and even obtaining an additional source of revenue
The implementation was carried out in less than three months, in close collaboration with Perfumería Júlia’s internal SAP team, which already had complete autonomy over module maintenance by the end of the project
SAP Flexible Real Estate covers all contract and property management processes within the system, reducing manual tasks and improving data quality and availability. This leads to faster decision-making, improved productivity and cost optimisation
The implementation by LOYIC of the SAP Flexible Real Estate Management (RE-FX) module at the company Perfumería Júlia shows how a high return can be achieved in a short space of time through a moderate investment in optimising real estate asset management.
History of Júlia and project background
Perfumería Júlia began in 1939, when a very young Júlia Bonet (17 years old) opened a hair salon on the ground floor of her home in Escaldes-Engordany. Bonet often travelled to Toulouse, France, to acquire the latest products in perfumery. Times were hard and this was the only way to obtain the most exclusive cosmetics for her customers. This represented the birth of a chain that, based on these same values of offering impeccable service and the best products, has already achieved a network of more than 70 establishments distributed throughout Andorra and Spain.
Recently, Júlia has thrown itself into a new business strategy: the Centros Júlia, spacious locations dedicated to comprehensive well-being and beauty: perfumery, pharmacy, hairdressing, aesthetics, cafeteria.... This has made their real estate needs bigger and more complex, to the point of assessing the use of a tool such as SAP RE-FX that facilitates detailed control of the revenues and expenses associated with these assets.
SAP RE-FX, an end-to-end management solution
SAP's flexible real estate management module (SAP RE-FX or SAP Real Estate or SAP Flexible Real Estate) is the solution for end-to-end real estate asset management. SAP RE-FX is part of SAP's Finance (FI) area, so it is fully integrated with financial and analytical accounting. It supports leasing processes, both lease-in and lease-out; purchase processes; and self-use processes. It also supports processes associated with service reception and provision. In addition, it covers IFRS 16, the new international accounting standard that entered into force on January 1, 2019, and affects lease contracts.
One of SAP RE-FX’s key strengths is its scalability, whether in functionality or in data volume. This enables it to cover all types of industries and sectors, from those where real estate management is the core business to others where real estate assets are a commodity.
SAP RE-FX is licensed separately and its cost is more than covered by:
- Increased productivity in different business areas.
- The savings resulting from better control of the rental costs of leased properties, as well as the recurrent costs associated with property ownership.
SAP RE-FX in Perfumería Júlia
The case of Perfumería Júlia perfectly illustrates SAP Real Estate’s scalability. Because SAP was already the company’s management system, logic demanded deploying the Flexible Real Estate module for asset control, thus avoiding the development of interfaces needed if other tools were used.
With SAP Real Estate, all the business processes in the system can be covered, in bulk if desired, while reducing manual tasks (whether in Office tools or from the SAP FI module). Plus, information quality and availability are also improved and decision-making is accelerated as a result.
SAP Real Estate integrates with various modules, including Fixed Assets (FI-AA), Projects (PS) and Maintenance (EAM). This facilitates a 360º degree overview of the properties. Integration can be implemented in stages, as business area needs grow.
Perfumería Júlia has:
- Properties leased to third parties: storefront premises, premises in shopping centres, ‘corners’ in department stores, offices, logistics centres...
- Owned properties leased to third parties: premises, offices, houses…
- Properties it uses itself: premises, offices…
SAP Flexible Real Estate implementation at Júlia took less than three months, from the initial definition of requirements to the first rental invoicing.
We worked closely with the internal SAP team in Júlia, and by the end of the project these professionals had acquired the necessary knowledge about the module and were completely autonomous for its maintenance. This is evidenced by the fact that they themselves, without any technical support from LOYIC, took charge of implementing the necessary adaptations resulting from the Covid-19 pandemic, such as the discounting (non-charging) of rent for companies whose activities were suspended.
Perfumería Júlia is a clear example of the SAP Real Estate module’s flexibility. The Andorran company has a diversified portfolio of real estate assets which, without being its core business, does represent a significant cost and, collaterally, also a source of income. Hence the importance of having a good tool for the management of these assets.
With Flexible Real Estate, Perfumería Júlia has all the details of:
- Assets in property, exploitation, etc.
- The costs associated with lease-in contracts.
- The revenue associated with lease-out contracts.