NEOBIO: Managing a ‘fairy-tale town’ with SAP S/4HANA Cloud Private Edition
Explore NEOBIO’s journey with SAP
Founded in 2017, NEOBIO has used its whimsical ideas to create parent-child travel landmarks such as children’s science and technology museums and sports halls. But leading the transformation of traditional indoor parks into a new era of composite businesses comes with challenges. So, NEOBIO used SAP S/4HANA Cloud Private Edition to standardize the processes of its four major business lines and its sales channels.
| Industry | Region | Company Size |
| Sports, media, and entertainment | Shanghai, China | 2,000–5,000 employees |
shorter monthly settlement (down from 5 days to 2 days).
greater efficiency of the store purchasing demand process.
working hours saved in the procurement process (down from >1,900 hours to a few minutes).
CTO, Shanghai NEOBIO Enterprise Management Co. Ltd.
Opening 45 stores in seven years for experiences customers can’t believe
Shanghai NEOBIO Enterprise Management Co. Ltd. creates an indoor parent-child paradise in every new location. From the magic book house in Shanghai, to the modern theater in Chengdu, to the time and space tunnel in Guangzhou, every store opened by NEOBIO combines local culture and market research to create unforgettable experiences for parents and children. Seven years after its establishment, NEOBIO has built 45 “fairy-tale towns” with different styles in 21 cities across China, becoming a destination of choice for urban parent-child activities.
In addition to the original store design, the services provided by NEOBIO are especially creative and innovative. Usually, a NEOBIO store combines park facilities, picture-book reading, parent-child games, catering, and more. To make food and drinks fresher and in line with local tastes, NEOBIO doesn’t use a central kitchen. Instead, it supports individual stores so they can come up with menu options that are the best fit for that location’s customers.
This kind of personalization and other user-friendly experiences have attracted many loyal fans to NEOBIO, but they also create challenges to back-end finance and operations. From a business perspective, ticketing, catering, courses, and retail formats are complex and intertwined, resulting in financial settlement and analysis that requires significant manual intervention. On top of that, today’s sales channels are scattered, and emerging channels such as Douyin and DianPing have different promotion and settlement methods.
In fact, when NEOBIO opened its 20th store, the financial pressure was already clear. Xu Lei, CTO at NEOBIO, explains, “The business is expanding rapidly, and basically, the financial accounting of the headquarters also needs to be expanded simultaneously. Considering NEOBIO’s future expansion plan, a linear rollout will definitely not be sustainable.”
So, in 2022, NEOBIO began its transformation. It sought a highly automated, stable, and scalable digital management system that could smooth operations in its fairy-tale towns, improving experiences for employees and guests.
Standardizing business processes for efficiency across growing locations
To reduce complexity and keep the headquarters functions more seamless and efficient during a period of rapid expansion, NEOBIO turned to standardized business processes. However, the business first had to understand the current situation of multiple business formats and parallel channels. This wouldn’t be easy. Xu Lei’s team spent nearly a year sorting out the internal processes in detail before selecting an approach to its digital transformation. Then, the team divided this approach into four major business lines: ticketing, catering, retail, and course services.
Based on rich implementation experience in the industry and using SAP S/4HANA Cloud Private Edition as the digital management base, experts for SAP Services and Support built standardized processes for NEOBIO’s four major business lines. The support team also classified NEOBIO’s originally dispersed sales channels, which are all included in system control. For areas in NEOBIO’s complex marketing system – such as catering and tickets as well as combined catering and retail products – the powerful functions of SAP S/4HANA Cloud Private Edition are particularly handy. Using cloud ERP, NEOBIO has set different revenue recognition rules for different revenue accounts. Now, revenue splitting and deferral have clear specifications and can be completed automatically.
To support processes related to catering at its stores, SAP Services and Support helped NEOBIO use the production management feature of SAP S/4HANA Cloud Private Edition to achieve systematic control that takes into account local taste needs and group procurement needs.
According to Xu Lei, the business insights and technical expertise from SAP Services and Support are the key to the smooth project launch. He says, “We are very happy to finally choose the original store for our implementation. Since the original store has rich implementation experience in the amusement park industry and has a very in-depth understanding of NEOBIO’s business format, the entire deployment and implementation only took six months, and the onetime switch was successful.”
CTO, Shanghai NEOBIO Enterprise Management Co. Ltd.
Protecting innovation throughout the enterprise with a comprehensive product system
Working with SAP Services and Support, NEOBIO used SAP S/4HANA Cloud Private Edition to construct the foundation of each store’s digital management from scratch. Now, as all four major business lines have full integration capabilities for industry-related and financial processes, NEOBIO can already achieve settlement cycle data aggregation, and sales profit analysis can be accurate to the SKU of a single product, helping ensure a timely response to market changes.
In the two years since the launch of SAP S/4HANA Cloud Private Edition, NEOBIO has opened 18 more stores, but the financial staff at the headquarters has not increased. Xu Lei says, “On the contrary, due to the highly automated and highly integrated performance of SAP S/4HANA Cloud Private Edition, financial colleagues at the headquarters are freed from tedious ‘logarithmic’ work and have more time to conduct financial analysis to guide business decisions.”
The SAP Build Process Automation solution solves the problem of inconsistency in financial and business processes in multiple scenarios with more speed and less cost. Four months after it was launched, more than 1,900 working hours were saved in the scenario of transferring store procurement to centralized procurement at the headquarters, and the efficiency increased by more than 83% compared with the original process. This process has been run more than 1,100 times, which is almost 85 days of work converted into working days. Xu Lei says the company’s investment has basically been recovered.
SAP’s global R&D department also launched localized solutions covering multiple business scenarios such as financial operations, fund management, and compliance reports based on the SAP Document and Reporting Compliance solution to help protect the compliance of NEOBIO’s digital transformation.
SAP solutions helped the company manage new cloud-based processes, implement process standardization, take advantage of process automation, and solve new problems. Just as every fairy-tale town designed by NEOBIO has ingenious ideas, the development of the business will continue to encounter new challenges. However, the SAP solutions will help overcome those challenges and enable growth.
“Collaborating with SAP has an additional benefit point for growing companies. This is that SAP offerings and best practices are comprehensive and systematic,” Xu Lei says. “Digital transformation can’t be achieved overnight. In the process of enterprise development, new problems will continue to be encountered. A strong partnership involves not only building a system, but also working together to solve every new challenge encountered by the growth of the enterprise.”