The Rise of RELEX: Innovation in the Retail Supply Chain
RELEX was founded in 2005 by Mikko Kärkkäinen, Johanna Småros and Michael Falck, three Finnish supply chain scientists with a vision to offer a more unified and automated approach to managing retail supply chains. By 2015, when Summit Partners led the company’s first institutional investment, RELEX was one of the very few disruptive vendors leveraging leading-edge technologies to quickly process huge volumes of data in real-time to help retailers plan better, sell more, waste less and drive better real-time outcomes. In December 2024, RELEX announced an increased investment from Blackstone and TCV; the transaction represented an exit for Summit. Here, we describe the learnings from nearly a decade of partnership with the RELEX team and three trends we see as defining today’s retail supply chain.
Today’s retail landscape is dynamic, complex and increasingly competitive. Retailers and suppliers face a massive challenge: managing increasing numbers of physical SKUs across multiple locations with differing seasonal sales patterns, physical sizes, profitability and roles in assortment, all against a backdrop of constantly shifting customer demand and channel proliferation. Customer expectations for product availability are high and supply chain disruptions are unpredictable. In today’s omnichannel world, we believe an optimized, responsive and agile supply chain can make all the difference between success and failure.
At Summit, we’ve been watching the evolution of retail, supply chain and related technologies for more than three decades. We see a convergence of three key themes that we believe have helped drive RELEX’s success and where we’ll see continued growth in the supply chain sector.
#1 The Rise of Composable Commerce Architecture
Retail and supply chain planning have long been dominated by large ERP incumbents and monolithic one-size-fits-all legacy systems; the growth of RELEX into a market leader demonstrates that the industry is embracing change. More and more, we see retailers and brands favoring a composable commerce architecture that allows them to integrate dedicated solutions via API, creating customized, highly efficient tech stacks tailored to their organizations’ specific needs. This movement is giving rise to a number of innovative dedicated vendors that are effectively creating new categories. For example, RELEX excels in forecasting & replenishment, price & promotion, and space & assortment planning; OneStock in order management, and Akeneo in product experience management (PXM).
Composable commerce architecture reduces vendor lock-in and risk, allowing organizations to continuously evolve and improve their digital ecosystems to help drive operational efficiency, enhance customer experience, and economically scale as their business expands. The MACH Alliance, which advocates for API-first, cloud-native, and headless technologies, exemplifies this movement, promoting modular solutions that empower businesses to detach from legacy tools and freely choose the best technologies available.
#2 Waste Reduction in the Supply Chain
Structural waste is a pervasive problem across today’s retail supply chains, where having the right product available at the right time is crucial but can easily lead to overstocking and financial losses. This challenge is felt acutely in the food supply chain as the limited shelf life for fresh foods creates an additional layer of complexity. An estimated 33 to 40 percent of the world’s food is lost or wasted every year. We strongly believe there is a clear need for technologies that enable better alignment between supply chain, retail operations and actual consumer demand.
RELEX has long tackled this challenge head-on with its AI-based, unified platform, which is designed to allow retailers and brands to more accurately optimize their forecasting and replenishment workflows. Taking a real-time, automated, data-driven approach, RELEX offers customers the ability to effectively respond to sudden changes in customer demand or temporary supply chain disruptions, while helping to ensure optimal inventory levels. RELEX reports that their grocery customers have consistently seen a reduction in food waste from 10% to 40% annually after they switch to RELEX.
#3 The Amazon Effect
Amazon has redefined the retail landscape, setting high standards for product availability, cost efficiency and rapid shipping. To meet these elevated customer expectations, retailers and brands are working hard to transform their supply chains, leveraging innovative retail technologies to improve their fulfillment, procurement and optimization processes. RELEX offers advanced demand forecasting, inventory optimization, and replenishment capabilities that help retailers predict customer needs accurately and ensure products are available when and where they are needed. By providing leading-edge forecasting and fulfillment capabilities, RELEX empowers their customers to respond swiftly and efficiently to changes in demand and product availability. We believe this technological edge is crucial for maintaining competitiveness in a fast-paced omnichannel landscape.
Growth Timeline
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Over the course of Summit’s investment, RELEX expanded from 160 employees to more than 2000 as the company has grown to serve more than 500 customers worldwide. This impressive growth trajectory is a testament to the company’s ability to address the evolving challenges of the retail supply chain. As the retail landscape continues to evolve, we believe RELEX's innovative solutions and commitment to customer success will ensure it remains at the forefront, helping retailers navigate the complexities of modern supply chains.
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The content herein reflects the views of Summit Partners and is intended for executives and operators considering partnering with Summit Partners. For a complete list of Summit Partners portfolio companies, please click here.
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