Darragh Fanning argues that Retailers need Real-time systems to support a truly multi-channel strategy. Written by Darragh Fanning , Founder and CEO, Celtech Software International Limited.
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Today, multipoint retailing is a lie masquerading as the future!
If you think that’s an exaggeration, think about what multipoint retailing should be and compare it to the reality. True multipoint retailing would give consumers the choice to do business with you conveniently where and when they want – in your stores, by mail order, by telephone, or fax, or through your website.
It would mean customers being able to choose any contact point to buy, collect, return, or exchange goods and receive identical and personalised treatment. It means giving every order taker up-tothe- minute information on stock, knowing how and when the order will be fulfilled. It means giving every customer service point full information on the entire product portfolio, not just those products available at that individual location. It means every point of sale in the enterprise recognising any, and every, customer and their recent transactions.
Do you recognise your current system here? Probably not, but with good reason. The prerequisite for multi-retailing on this level is a 24×7, consolidated, real-time view of the whole business that traditional retail software just does not offer.
And while we’re sweeping away archaic structures, let’s do away with the misconception that multi-retailing came about with the Internet. What e-tailing brought was the requirement for management to understand how 24×7 could be incorporated into their businesses.
Unfortunately, for many, the answer has been the establishment of yet another separate retailing system, and in many cases separate inventories, with yet more batch interfaces swapping information across the enterprise in a constant bid to keep track of sales, stock, and cash. For too long, retailers have tried to cope with increasing complexity by bolting on a module here, tinkering with a module there. The result is an evolutionary dead-end of excessive investment in sub-standard infrastructures and administration functions to overcome their fundamental shortcomings.
What is needed is a revolution, a paradigm shift that breaks with the past and an investment in systems architecture capable of dealing with the challenges that multi-retailing brings. Multipoint retailing demands Realtime retailing – a new approach that delivers end-to-end retail management.
The key to real-time multi-retailing is the integration of head office, branch, and pointof- sale functionality in one, tightly integrated package underpinned by a single, unified database, on-line EpoS processing, running on a mission-critical-capable platform.
Immediate visibility of all stock, everywhere
Immediately, all your channels to market share one version of the truth. Every pointof- sale, whether in-store, callcentre, or website, sees the actual, up-to-the-minute stock position and is free to take orders knowing how, and when, they will be fulfilled. And every point-of-sale transaction is processed on line, in real time, updating the stock position immediately and eliminating the delays that originate from EpoS batch processes.
That single database also works for customers, allowing them to choose where and when they order, buy, or return goods. For instance, a customer could call their local video outlet asking to hire that week’s number one film. In a real-time, multiretailing world, that outlet will tell their customer, either:
- Yes, I’ll reserve it for you
- No, we do not have it here, but we do have it at our other store in town and I can reserve it for you to pick up
- No, we do not have that film in stock, but, looking at your records, I think that “XYZ” is the kind of film you would like and we have that in stock
Of course this demands that individual customers have a single identity rather than holding four different identities at four different touch-points (membership store, other stores, web, call centre), but the underlying unified database enforces just that and guarantees consistent service across the channels. Comprehensive management of stock Real-time stock data brings other benefits too. Centralised purchasing of fast moving goods for individual stores is credible, since on-line, real-time EpoS allows purchasing to track the movement of individual product lines by location and react immediately to significant changes in volume.
At the other end of the scale, inter-branch transfer of slow moving items to cope with outages or optimum sales patterns is equally possible. An on-line, real-time database also ensures more accurate stock data across the enterprise. Data only has to be captured once, at source, as it happens.
Bar-coded on at the point and time of delivery, moved off at the time and point of sale, transfers and reconciliations between separate head office, branch, and warehouse systems are eradicated at a stroke. So too are lengthy stock counts!
Looking for ways to profit
Real-time computing provides a solid platform to manage all aspects of your business with greater speed, accuracy, and confidence, with a Back Office and In- Store system that takes care of business as it happens, and provides the tools to let you look for ways to profit. Pricing and promotions can be planned centrally in advance but implemented instantaneously across the entire estate.
New business concepts and retail initiatives can be brought to market quickly, much needed agility in today’s competitive environment. And accurate and comprehensive stock data will help your team manage margin consistently. Alongside real-time control of pricing and margin, category management and store/channel profiling are also at your fingertips.
Integration from Purchasing to EpoS
What multi-retailing demands is a single, integrated system that extends from purchasing all the way through to the till, supplying instant information to any point within the enterprise. The old hodgepodge of make-do-and-mend systems don’t work and cost money, reflecting the fact that “Good enough, isn’t” and “Short cuts, aren’t”.
However, the simpler IT infrastructure that an integrated approach brings leads directly to inherent reliability, significant IT administrative savings, and the liberation of the IT department from individual store support and rollout pain What’s more, it recognises that, ultimately, it is less expensive to do the job right than to continuously invest in workarounds and solutions to problems caused by not building on the right foundations, and rewards you with the lowest cost of ownership and real investment protection.
Communications, communications, communications
Traditionally, the objective for retail systems was to extract and compress information for overnight exchange between head-office and stores on expensive, lowbandwidth comms links. The batch process penalty is lengthy reconciliation processes to verify data integrity as well as administration functions to resolve any conflicts or errors, an investment in workarounds and administration rather than an efficient and effective infrastructure.
The cost of communications continues to fall, just look at Telecoms shares if you need proof, yet the quality continues to improve. Therefore, the time is right to take a fresh look at the entire systems infrastructure. Information is the life-blood of any retailer and it is essential to capture information at source, where it is most accurate.
If there is a problem, such as an unrecognised barcode, then create it instantly – once – and make it available across the entire estate immediately instead of having the same problem at every store. The cost and efficiency savings, especially for on-going rollouts, will more than cover the increased cost of a permanent communications infrastructure.
Back to the future
If all this sounds like a return to centralised computing – it is. Ten years ago, IT departments were busy chucking as many applications off the mainframe as they could. Now, they’re dusting off the old mainframe concept and getting rid of their server farms. If this seems bizarre or risible, remember that real-time, multiretailing demands fault-tolerant, 24×7 computing on THE mission critical system.
For the retailer who revolves the business around EpoS on NT, and most do, this is potentially a huge problem. In its way, EpoS is mission critical – it takes the cash. However, if it fails it reboots and comes back up at a different point. This is just not appropriate for a mission critical function within the business that should be available, reliable, and above all, predictable.
By comparison, computer systems that have come to be regarded as slightly old-fashioned, such as IBM’s AS400, provide browser-based access inbuilt fault tolerance and automatic recovery to the point-of-failure – very important when you’re keeping track of cash. In many ways, EpoS has received too much emphasis for a simple data capture device and, although current efforts are trying to deliver more functionality to the screen, the traditional NT-LAN model makes it near impossible.
Take our video club member again. Why should a club card customer who signed up in their local store not be able to get discounts and card points in another store? The customer should get the same quality of service in each store by being able to use their card in each store. This is multi-retailing and, with real-time access, it is simple.
Management from Anywhere
Our vision of real-time, multi-retailing runs everything – from warehouse to EpoS – and all accessed through a simple web browser. Access is no longer limited by location – just authority – and the increase in the availability of information across the entire estate means that decisions can be arrived at, and implemented, at any time, in any place.
It offers retailers what they have always wanted – the ability to see and manipulate in real-time the key performance indicators of the business. Not just view stock, costs, pricing, and promotions as historical data, but influence today’s profits now. So rather than imagining how your current infrastructure can be tinkered with yet again to do your version of multiretailing, why not do it properly. Realtime does just that!
Celtech and ab-initio Celtech develops operational business systems for the retail and wholesale marketplace, spe – cialising in the fast moving consumer goods (FMCG) sector. The company is the first in the industry to provide a real-time holistic view of operations, achieved through a single integrated database that allows data collection on -line. Celtech’s end-to-end business information system, abinitio, provides real-time integration from Point of Sale to Purchase Order Management, incorporating a transaction system for operational management, planning and profiling of merchandise.
For more information email sales@celtech.ie