White Paper: Break Down The Barriers To Retail Operations ExcellenceSource: Reflexis Systems, Inc.
By Tim Lynch
In the past decade, retailers have invested billions of dollars on advertising and technology to attract customers and get the right product in the right store at the right time at the right price. Retailers have invested in new technologies such as wired and wireless networks, supply chain systems, planning software, and more to improve efficiency and reduce costs. At the same time, retailers have spent significant time and money developing and implementing marketing and merchandising strategi es to drive increased customer foot traffic and build customer loyalty.
Most of the technology retailers have implemented in the last decade has enabled improved performance in one functional area, such as merchandising, marketing, or supply chain. Although these applications can streamline planning and approval workflows and increase efficiency within one department, they do not do as well at improving collaboration among two or more functional areas. Furthermore, when it is time to communicate and implement their retail strategy in their stores, many retailers still rely on obsolete tools such as email, plain old telephone, and even faxes and paper memos. The use of these manual tools makes it difficult or impossible for retailers to monitor how well their strategy is being implemented, analyze the effectiveness of the strategy, and respond on a timely basis if necessary.
The lack of cross-functional visibility and collaboration in four key retail processes – new item introductions, promotions, price changes, and recalls – often leads to suboptimal execution of retail strategy. Retailers use inefficient tools and processes in their operations when better solutions are available that enable success in the increasingly competitive and dynamic world of retailing. By implementing these tools, retailers could realize the following benefits:
A retailer could drive a positive impact of millions of dollars by:
- Executing new product launches as intended – a retailer could increase sales by 2-5%
- Carrying out promotions as intended – a retailer could increase sales by 2-3%
- Improving price change execution – a retailer could increase compliance by 20%
- Executing product withdrawals more efficiently – a retailer could improve brand loyalty by reducing the time to complete a product recall from 5 days to 3 hours