The Sharper Image retained Paragon Consulting in 2000 to help upgrade their order fulfillment system and develop new systems like a European web order system and mail order allocation system. Paragon also designed vendor contract, purchase order, and forecasting systems. In 2002, Paragon developed a custom warehouse management system for less than half the cost of packaged software. Additional systems like store acknowledgement and physical inventory were also developed. Paragon became The Sharper Image's exclusive partner for mission critical warehouse and merchandising systems, helping the company grow revenues from $300 million to $800 million over 4 years.

1. THE
SHARPER
IMAGE~
sharperimage.com
To whom it may concern:
In September, 2000 The Sharper Image retained the services of Paragon Consulting Ine. to help us with the
upgrade of our IBM I-Series AS/400 based order fulfillment system to handle the opening of our new west
coast distribution center. This was an important milestone for our company which had previously managed
and shipped inventory from only one DC. It became clear very early on, that Paragon was to become an
important partner in the expansion and improvement of our IT infrastructure.
Upon completion of the west coast DC integration project, Paragon went on to participate in the
development of a new European Web Order management system. This system allowed us to receive orders
from our Yahoo based European web sites, perform payment authorization and trigger shipment releases to
our distribution center in Western Europe.
Paragon then completely re-engineered our mail order allocation system. This was a large undertaking that
allowed us to decentralize responsibility for the execution of order allocations from our corporate office to
our individual distribution centers. Our original system was plagued with bugs and limitations, and now
became a robust application that could run completely unattended and allowed the individual distribution
centers to create and manage their own allocations via customizable templates, using a wide variety of
filtering, sequencing and sorting parameters. The system was designed to be fully multi DC compatible and
now handles the allocations for five distribution centers across four geographic regions.
Paragon's involvement in our systems continued to expand into the merchandising arena where they
designed and wrote new vendor contract management systems, purchase order and merchandise planning
and forecasting systems.
In late 2002 and early 2003 our executive committee was faced with the daunting task of introducing a new
and improved Warehouse Management System. We briefly considered a number of large packaged
software choices such as Manhattan Associates. The cost to the Sharper Image would have been prohibitive
at approximately $ 1.5 million. Instead, we decided again to employ John Bowler and the Paragon team to
write a tailored, custom WMS system. Their collective warehouse and distribution knowledge as well as
technical expertise was eminently reflected in the outcome. Our resulting WMS system now handles all
manner of inventory movement within and between our distribution centers, from bulk storage
management to primary bin replenishment to picking and shipping. All these systems use wireless handheld
technology wherever possible, allowing real time data update directly to our I-Series. Paragon was able to
develop this system for less than halfthe package vendor choice.
An adjunct to the WMS system, the Store Acknowledgement System, was also developed for use at our
retail stores, to allow our store managers to acknowledge receipt of deliveries. This sophisticated system
again used a combination of hand held and terminal based technology. Early on we encountered a logistic
hurdle in the simultaneous training of 160 stores on the use of this application, but Paragon again stepped
up to the plate, producing comprehensive training manuals, conducting Web Based seminars and even
produced a full motion interactive training DVD for general distribution.
In January 2004 Paragon prototyped a physical inventory system, again using a combination ofhand held
and terminal based applications and rolled out the system to five selected test stores across the country.
They provided exceptional onsite support and training throughout the process. The system implementation
was so successful that we will be deploying it to all our other stores and distribution centers for future
physical inventories.
650 Davis Street, San Francisco, CA 94111 415 445-6000
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2. Our relationship with Paragon has continued to grow to the point where they have now become our
exclusive choice for all mission critical Warehouse Management and most Merchandising systems
development efforts. They have a dedicated team of consultants based at their office in Scottsdale, Arizona,
working on our account. We have found them to be an invaluable business partner, not only in the
development of sophisticated state of the art applications but also in advising and guiding us through
various supply chain procedures.
In the past 4 years, the Sharper Image has grown from a $300 million company to nearly $800 million in
revenues, with targets of hitting the billion dollar mark within the next 2 years. Paragon Consulting has
made an important contribution towards our successful growth over this period. They have been
instrumental in restructuring and streamlining numerous IT and business related operations and have given
our user community an unprecedented level of comfort in both technical and functional support.
I would not hesitate to recommend them for any process or system development effort.
Sincerely,
Greg Alexander
Sr. V.P. Information Technology
The Sharper Image
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