“As a fashion retailer, the three major problems (pain points) we face are: retail store connectivity to head office (we operate 160 Megamart stores of size 2000-3000 sq.ft in Tier I, II, III cities); assortment planning at stores and demand forecasting,” says K E Venkatachalapathy, COO, Arvind Retail Ltd. Arvind Retail implemented Oracle Retail (Retek) in Megamart a year ago at a cost of Rs 15 crore. Implementation was in two phases; the first phase was all transaction modules, and the second phase was planning and information. “We spend around Rs 3-4 crore per annum on IT maintenance and infrastructure,” Venkatachalapathy informs. “We currently have Oracle Retail ERP for back-end. We use Voyager POS systems for our Point of Sale System and Customer Relationship Management. These two products cover all retail aspects of our business including supply chain management, BI, POS, customer loyalty and inventory management.”

“We spend around Rs 3-4 crore per annum on IT maintenance and infrastructure,” Venkatachalapathy informs. “We currently have Oracle Retail ERP for back-end. We use Voyager POS systems for our Point of Sale System and Customer Relationship Management.  These two products cover all retail aspects of our business including supply chain management, BI, POS, customer loyalty and inventory management.”

At Madura Garments, real-time information visibility across the supply chain, constant change in business process due to market dynamics, and seamless IT integration across disparate IT platforms/solutions are the three primary concerns. Over the last 2-3 years, the company has invested in the best of breed solutions – Oracle Retek ERP for single source of enterprise data for supply chain execution, allocation, replenishment, purchasing and store operations; Merchandise Financial Planning that helps in planning and optimising merchandise (item, product group, brand) for various stores; CRM to aid in matching product mix/assortment, promotions and service delivery to match customer expectations; PLM to optimise lead times in sourcing, aid technical design and product development; BI to analyse underlying key business performance parameters and aid in informed decision-making; planning and budgeting to eliminate manual processes, standardise P&B formats, thereby increasing productivity; and POS to help deliver a superior shopping experience, increase employee productivity, capture key customer data and support pricing.

For Titan Industries, the key concerns are enhancing customer experience, and agility to support training front end staff for day to day IT operations along with uniform support in all locations.

As is evident, the critical concerns are common, and there is a long way to go before technology’s role in fashion retail can be optimised. Following are the 10 things technology vendors need to know about how retailers think.

1. Data Synchronisation
The use of inaccurate and outdated data in invoicing and purchasing orders results in delivery errors and lost sales. A 2003 report by A.T. Kearney found that delivery errors cost the retail and consumer products industries in the U.S. about $40 billion annually.

Another study, released by AMR Research, revealed that 30% of items in product catalogues contain errors, requiring 25 minutes per SKU to correct. This study also found that incorrect product data results in returned shipments, delays in payment or deductions on invoices, and costs between $60 and $80 per item.

In India, lack of continuous internet and bandwidth connectivity among the head office, the warehouse and the store is a major problem faced by fashion retailers. “It is a major problem to get data from stores on a real-time basis,” says Anil Lata, general manager-finance and IT head of Pepe Jeans India.

According to SAP, accurate data helps at all stages of the supply chain, from purchase order to delivery, from storage to the retail shelf. Suppliers are finding that by synchronising data across their entire supply chain infrastructure, they can enjoy benefits such as:

• Lower costs for shipping and logistics
• Fewer discrepancies in shipments to retailers
• Reduced number of invoice write-offs incurred as a result of data discrepancies
• Improved outbound logistics processes within their infrastructure
• Faster time-to-market with new products

With global data synchronisation (GDS), new items can be received, processed, and approved within hours. Narrowing this time frame generates tremendous benefits to suppliers and retailers.

“Data synchronisation between store and Head Office is a major problem for us,” admits Jay Gupta, MD, The Loot (India) Pvt. Ltd, adding that in terms of solutions, “there is long way to go”.

2 Understanding the Requirements
International best-of-breed retail enterprise solutions are not yet fully localised for Indian retail nuances. There are a lot of local retail products available, but they are either not comprehensive or cannot scale up to enterprise levels. Generally, local products cater to specific process areas, such as points of sale (POS), trading and distribution, accounting, etc. Furthermore, since modern retail is fairly young in India, local products do not incorporate global best practices in retail, as the domain knowledge is limited with local product vendors for modern retail.

Indian service providers are generally tuned to develop software on the basis of specifications given by their overseas clients. They are not used to design or develop innovative solutions as per business requirements. They do not have sufficient domain knowledge in requirement analysis, leading to a mismatch of expectations in the execution of projects.

To address the local market, tech companies in India need to give sufficient importance to consultants who understand the domain and the technology and act as an interface between the business and technology teams.

Tech companies also need to employ innovative methods to keep the investments low and give measurable business benefits in return.

Service providers often come to retailers from a technology perspective, without relating it to the ground reality of the business. The need of the hour, therefore, is for technology companies to understand the business imperatives and partner at a strategic level. More importantly, they should have worked in the retail sector and understand it well.

“Most technology solutions provide around 80 per cent functionality to what Indian retailer require,” says Arun Gupta, customer care associate and Group CTO, Shopper’s Stop Ltd. He adds, “The rest is parametrisation and customisation to specific needs. Indian IT focus has been services, to a large extent, and not products. The few products that Indian IT companies created have been in other verticals, such as BFSI. In the last few years, we have seen a few IT companies attempting to create solutions for retail. Some companies understand retail well and are able to engage with ease; others are picking up. They need to invest in understanding business challenges and operational issues before presenting a menu card of what they have to offer.”

Nadeem Malim, IT manager, Infiniti Retail Ltd, says companies such as TCS and IBM are particularly well-versed with the specific needs of retail operations.

Today, the Indian market is dominated by international players such as JDA, SAP, Retek and others. Due to this dominance, SME retailers have challenges in areas such as ERP acquisition costs, ongoing maintenance and communication set-up.”

On the specific concerns that retailers would want a technology solution provider to address (areas that currently remain unaddressed), cost optimisation (implementation); post-implementation support (localised); willingness to support the retailer in case of implementation failures; lower TCO and strong partnership rather than the vendor-customer relationship with the retailer are top-of-mind. Also, systems should be built/customised/implemented keeping the Indian communication infrastructure in mind.”

Aditya Birla Group, on its part, observes that most IT vendors/companies approaching it do have knowledge of retail operations, but may not have a know-how of global best practices as retail in India is at a nascent stage and is evolving.

Gupta at The Loot believes IT vendors/companies approaching him by and large understand business functions and the technology needs of the retailer. Most are able to advise and place the right solutions at his disposal, he says.

“Our observation is that IT vendors who work in close coordination with customers and leverage their global work force expertise are able to recommend the appropriate solutions,” says Neeraj Pal Singh, CIO at Madura Garments.

3 Staying in Sync with Innovation
Technology heads of fashion retailing companies need to continuously stay in touch with innovations happening in the industry. They can do this in various ways. Gupta of Shoppers Stop, for instance, actively participates in IT-related activities. “I often visit retail industry events and seminars,” he says. He believes for every solution explored, there may be local or global customers outside retail who could provide learning from their experiences.“The IT needs of an organisation change when the business process of the organisation changes. These could be driven by changes in market conditions, reorganisation of the business, or by new technology developments,” says Amit Mukherjee, group CIO, RPG Enterprises, and VP, SCM, Spencer’s Retail Ltd.

It’s not very difficult for CTOs (chief technology officers) to cope with continuously changing IT needs of a company. Retailers tend to stick to their old IT partners, even for future IT requirements, due to the convenience in dealing with old partners who have been tried and tested and are familiar with the operational needs. This means that technology vendors looking for long-term clients should be able to adapt to the changing business environments in conformity with the existing enterprise functional requirements.

“Updating oneself on the ever-changing technologies of IT is not a meagre task; it is an ongoing process of development and knowledge gain. We are always updating our system/knowledge by consulting with experts in different segments of IT. Sometimes we outsource certain functions and solutions of our vertical for zeroing down on problems, decreasing solution-time and managing issues that we do not possess the expertise in,” opines Amit Ladsaria, director, The Turtle Limited.

Retailers such as Hidesign feel talking to industry experts regarding upgraded technology definitely helps.

Aditya Birla Group says if the IT strategy is aligned with the business strategy, it becomes easier to cater to the changing business needs and requirements. The Group identifies and interacts with key vendors for specific needs and requirements and engages with them to understand their solution offerings and conduct a POC (proof of concept) before finalising or zeroing down on particular vendor.

The Loot feels it is a part and parcel of its CIO’s job to look out for new initiatives to reduce the cost and increase revenues.

4 Lack of IT Skills
Another issue faced by retailers is the lack of technology skills among the staff at the store level. Sometimes, employees’ inability to grasp slows down the process of IT training. Also, due to the change in staff, training sessions need to be conducted again for new employees. Agility to support training front-end staff for day-to-day IT operations, along with uniform support in all locations, is also a big challenge faced by retailers.

Some retailers, such as Lilliput, though, have found a solution to this cumbersome problem. As a result of the technology solution provided by Tectura, Lillput’s system maintenance effort at the store level has reduced by 40 per cent. Due to the availability of data on a daily basis from the store level to the HO, most tasks are now handled online by the head office. A lot of retailers, though, still need to follow suit.

5 Effective Supply Chain Management
Supply chain is an integral part of retail operations. Due to operational difficulties and pressures to manage costs, present-day retailers are realising the importance of an efficient supply chain management.

For big fashion brands and retailers who seek to replenish their merchandise rapidly, an efficient stock management is, in fact, a critical part of their business operations, especially because the average life cycle of most fashion products is estimated to be around four months – after that the stocks are usually replenished in just six to seven weeks.

Also, with rising input costs (cotton prices have gone up by 20 per cent in the last six months), the pressure on retailers to keep prices under control increases. World Player, a low-cost brand from S Kumars Nationwide, with a price range of Rs.99-499, is banking on an efficient supply chain to resist pricing pressure. “Through volumes and efficiencies in supply chain, we will keep our cost structure to the basic minimum,” says Johnny John, COO, World Player.

World Player has in place a network of 47 outsourced warehouses across the country “to ensure quick supply and replenishment”.

Apparel retailer Indus League Clothing, which went live with SAP early this year, has increased its IT budget quite a bit for backend transactions. “This is done,” says Rachna Aggarwal, CEO, Indus League Clothing, “so that we do not stock for the heck of stocking.”

Effective supply chain management can also help a retailer in retaining customers and stopping them from going to a competitor. For instance, if a customer walks into a store of a big fashion retailer and fails to find the size or colour of the garment that he/she desires, the store personnel can scan the computerised database and check if any other store of the same brand has it. And if there is a match, the customer can also have it delivered to his home within two days. Supply chain management, thus, ensures a good name and customer service for the retailer.

Also, when a brand expands its presence across the country, and increases the number of stores and warehouses, it’s an effective supply chain management that ensures proper coordination and cost management and proper distribution among all business units.

Recently, Timex Group, which is looking to invest about $1 million in retail expansion in the country, said it would follow a leaner supply chain in its watch business, to achieve its targets. The company said shorter lines were being devised to cater to the customer preference for new designs at shorter intervals.

“We want to be quick in responding to market requirements. Consumers are looking at watches as an extension of their personality and are changing watches sooner than they did earlier. This has led to shorter life cycles and newer designs,” says Kapil Kapoor, COO, Timex Group, USA, and vice-chairman, Timex Group India.

Timex Group, which has a facility at Baddi in Himachal Pradesh, plans to focus on retail business in a big way. “We see a lot of growth from our retail business. India represents a huge opportunity, and we are gearing up for it. Our own facility helps us become responsive to market requirements,” Kapoor says.

The company’s watches are retailed through MBOs as well as its own retail channel – Time Factory. Currently, the brand has 69 Time Factory outlets and is looking forward to double it over a period of the next two years using supply chain management.

Hidesign, too, is committed to getting its processes right and invest in IT infrastructure once a well-tuned system comes under pressure. Having said that, as the brand has grown to 150 selling points, its supply chain processes, including demand planning and warehouse management, have come under pressure.

Lilliput now runs Microsoft Dynamics NAV at the backend, which is totally integrated, via LS Retail, connecting 200-plus POS locations. The all-in-one solution implemented by Tectura seamlessly integrated the entire supply chain for Lilliput. As a result, the efficiency of users in the warehouse, in terms of the time consumed in managing warehouse processes, rose to 60 per cent due to total process mapping integration across the supply chain.

Another kidswear brand Gini & Jony engaged BIRetail to drive efficiency and derive spin-off benefits in the form of profitability. In 2002, the firm implemented an enterprise resource planning (ERP) solution – Logic. ERP Logic was initially implemented on the supply chain system, but later extended to cover raw materials, production and finance. Further, Giny & Jony adopted a simple technology, the SMS-based sale automation module, that enhanced ERP Logic, giving top management a daily sales update on-the-fly.

The firm also implemented a real time online customer relationship management (CRM) programme – Wonder World – that allowed the customer to earn and redeem points immediately, from purchases made at any Giny & Jony EBO.

Gaganjit Kahlon, IT head, Gini & Jony, says the company has grown manifolds and brought many new stores under its umbrella, with new brands, in order to have a pan-India presence.

“Logic helped us make quick decisions; for instance, we could even start work at a new location in two days or open a warehouse within 10 days,” he says.

In 2009, the brand adopted a business intelligence solution from BIRetail to improve decision-making and, thereby, the bottom line. The solution helped the retailer reduce operational costs. “BIRetail provided a complete cost-effective solution, not just a business intelligence platform,” says Kahlon.

Maintaining that the solution added both to the top line and the bottom of the company, Kahlon says, “The idea was to get fast-moving items off the shelves in seven weeks.”

Even as the overall deployment in the retail sector is low, a few retailers well understand the advantages offered by an effective supply chain management. “Our supply chain is reasonably optimised. We will continue to invest in technology solutions to create improvements. The biggest opportunity within our supply chain is to improve the vendor fill to warehouse as well as to the store (in case of direct store delivery),” says Gupta of Shopper’s Stop Ltd.

He further says, “If all stakeholders (in supply chain ecosystem) understand the impact, they will be able to take action based on the information delivered, and the balance between excess stock and out-of-stock conditions can be managed effectively. However, there are still problems, such as pilferage, maintenance and right delivery of schedules, that bug the supply chain system.”

Sunil Kunders of Arvind Megamart says Oracle Retail has provided the company an end-to-end link of all processes and departments in the retail supply chain. “The solution has given Megamart full visibility in the movement of goods across all stocking locations. However, store assortment planning is one of the major pain points that we plan to address soon,” he adds.

At Vishal Retail, the supply chain solution helps in making purchases at the right time, tracking the movement of stock and checking the availability of stock in warehouses and stores.

Mukherjee of Spencer’s Retail says, “As most articles that we sell in our stores are sourced from the same city, in-transit stocks (between distribution centres and stores) is not an issue.” But the major pain areas in supply chain, he adds, are identification and management of near expiry stocks and reverse logistics (management of returns from stores to distribution centres and from these centres to vendors). Spencer’s, though, has developed systems on portable data terminals (PDTs) to receive goods in DCs, do stock counts and act as mobile POS machines at stores.

In Titan Industries, too, supply chain is well integrated with ERP and other systems.

“As an organisation we are committed to getting our processes right and only invest in IT infrastructure once a well-tuned system comes under pressure. Having said that, as we have grown to 150 selling points, our supply chain processes have come under pressure – primarily supply chain, demand planning and warehouse management,” says Dilip Kapur, CEO, Hidesign. “Flexibility and agility of the supply chain are the key challenges because the world is changing very fast in terms of technology and because we are in the fashion industry,” he adds.

“We are able to maintain seamless process within departments most of the time. But sometimes, due to connectivity issues, there is a slight delay in synchronising data,” says Anil Lata at Pepe.

“For our supply chain needs, we have developed an in-house module for synchronising data between stores and HO. Currently our warehouse system is linked offline with the HO. We are looking at synchronising the HO, warehouse and stores through an online system.”

“We currently use an inventory management system called VWP warehousing system. We also have an Auto Replenishment System at HO and stocks levels at the stores are replenished based on this system,” he adds.

“We have deployed a state-of-the-art warehouse management solution, which caters to inventory management based on norms at the store level and at the central warehouse. This system is seamlessly integrated with merchandising system and POS system at stores to ensure auto replenishment of stocks on daily basis and reduce stock outs,” says Neeraj Pal Singh at Madura Garments.

6 Low Tech Budgets
The annual spend on technology solutions differs from retailer to retailer. While Pepe allocates approximately two per cent of its retail store sales on technology, some big Indian retailers such as Bharti, Reliance and Tata, among others, have invested or plan to invest huge amounts on technology.

But as the modern retail sector in India is at a nascent stage, a majority of retailers use a very basic technology or have only started building it up. For instance, Anil Lamba, general manager, finance, and IT head of Pepe Jeans in India, appears to be satisfied with the level of IT deployment in the company. “The IT infrastructure in our company meets all our current requirements. But, as the business would grow and more stores would be added, we would upgrade ourselves to a solution that provides real time data,” he says.

Aditya Birla Group, too, seems content with the level of IT deployment in their business and feels it is aligned with its business strategy and updated on a continuous basis, depending on the changing business requirements.

“Our IT departments liaise with key technology partners (vendors) to evaluate emerging technologies relevant to the industry. This helps in identifying and carrying out POC testing and deploying the solutions much in advance to support new business initiatives,” asserts Neeraj Pal Singh at Aditya Birla Group.

The Loot, however, does acknowledge the fact that technology in itself is a vast domain. On being quizzed whether he is satisfied with the level of IT deployment in his company, Gupta at The Loot, says there is still a long way to go, and a lot of scope in the field of technology.

Another retailer, Hidesign, is currently investing heavily on IT in the ongoing fiscal, keeping in mind how the business would shape up 10 years later. The company’s annual spend on technology solutions for its retail operations depends on its needs, which, in turn, differ from year to year.

Hidesign feels the IT vendors approaching it with business solutions usually replicate IT systems implemented earlier and don’t spend enough time to understand business processes. They suggest more time needs to be dedicated in understanding the business before a solution is pitched in.

Giny & Jony, however, is careful about choosing its IT vendor. “We are very careful about the IT vendors we choose, making implementation and maintainence of the solutions of the vendors a priority,” says Kahlon.

Titan Industries has allocated a decent amount – approximately Rs.50 lakh – as its annual spend on technology. The company, in fact, has very ambitious plans for changes in the next few years. “We have engaged reputed organisations to draw the company’s IT strategy for the next five years,” says C S Ramesh, general manager, IT, Titan Industries.

He adds, “There are various solutions that are offered to us by IT vendors, but we evaluate them and study the ROI before making any plans.”

Similarly, Turtle has allocated Rs.2 million as its annual budget spend on technology. “We are in an industry where full satisfaction can never be achieved – it is an ongoing pursuit of evolvement. We are always updating our company with latest technologies and best-in-class services. For that we are ever-connecting with vendors and technology leaders from time to time,” says Amit Ladsaria of The Turtle Limited.

Maintaining that the retail revolution is relatively new in India, Ladsaria says, “We regularly face new challenges and requirements, which we share with our IT partners and working together, we develop new modules or refine old ones for a mutually beneficial progress.”

Most retailers, though, are oblivious to the tangible and intangible benefits deriving out of technology investments, as they do not measure the ROI on these investments.

7 Scalability
A retailer wants to invest in technology that stays with him as he grows. Most retailers looking for right business opportunities need an internal process to evaluate IT partners to meet their growing business needs. Take Shopper’s Stop Limited, for instance. The IT team of the company works with a few strategic partners and tactical vendors to deal with scalability requirements of the business. “Product, service and/or vendor selection is an integrated process, with business and IT working together to ensure the vendor understands the final impact that its services and solutions are likely to create,” says Gupta.

No new IT system would be required to manage business expansion in the same formats and scaling up operations or opening new stores. If a retailer opens new formats, it is possible that new solutions would be required. In case of expansion, they prepare a request for proposal document, outlining their requirements in detail, which is circulated to different competing solution providers. No modern retail chain can function effectively until its internal processes are well defined, integrated and all routine functions automated.

Any solution available across the world becomes available in India within a short span of time. However, relevance to Indian retailers, conformance to Indian regulations, accounting standards and pricing determine the success of a product in the Indian market.

A few retailers feel there is no problem in getting proper solutions for the Indian market. The gap, though, is in the cost of acquisition. Cost-effective solutions are often not scalable and scalable solutions are often not cost-effective, particularly during the start-up phase of a new venture. The answer probably lies in IT suppliers offering a revenue-sharing model, rather than a fixed cost model, as they do now.

Some retailers face a somewhat unusual problem. They don’t find it difficult to get what they expect from technology companies; however, their own requirements are fuzzy and not well articulated. Usually, it is seen that retailers begin to understand that what they really want is in sharp contrast to what they had started with. This creates a gap in expectations as well as value propositions that the supply side would want to offer. “The understanding of technology companies is dependent on their awareness of the customer’s business, which is mostly riddled with the assumptions that are not always aligned to reality. This gap leads to misrepresentation of capability, value and benefits,” says Gupta. However, as enterprises move forward, the alignment gets better. This applies to almost all solutions available today. The gap is also evident with solutions that have been successful globally, but struggle in the Indian context as their implementation does not offer the same level of benefits to Indian retailers and in a few cases has no relevance to the way Indian retailers conduct business or the way consumers shop. “We also see a quality gap, as the manpower available in the Indian market is a few shades less than the resources allotted by IT companies to their international customers. So, there is a gap between demand and supply, as the demand is not necessarily what organisations really want in the first place,” adds Gupta. Vishal Retail feels there are only a few companies that understand the IT needs of a retail company, which often creates a demand-supply mismatch.

8 Tracking the Customer
Good customer management has become mandatory for retailers these days. It includes providing a better shopping experience to customers, attracting footfalls and translating them into sales. It also includes loyalty management in which retailers retain customers by launching a variety of schemes, providing them with gift cards in order to lure them with special privileges and benefits and, most importantly, addressing their needs and expectations in an effective manner. Technology comes in handy in realising these goals.

Floor and space optimisation, also known as store mapping, which is used to allocate space judiciously and prudently for product placement, can also be done effectively with the help of technology. “We use tools from JDA for it,” says Gupta of Shopper’s Stop. JDA Store Systems, according to its official website, “provides multi-channel value chain and enterprise visibility, empowering your operational teams to speed up transactions at the point-of-sale, handle back office duties, decrease labour management costs and drive customer loyalty programmes so that your company can operate like a finely-tuned chain while executing at the store level”.

According to Gupta, while video surveillance is a vital tool to prevent revenue leakage and manage shrinkage, Shopper’s Stop Ltd does not use video cameras for customer count or studying how much time customer spends in specific areas of the store.

“The efficacy (of a video surveillance system) is still not good enough and do not provide good returns on investment,” he says.

Vishal Retail has video surveillance equipment installed in its stores at every location. It has also dedicated a research team to study different aspects of retail, including customer behavior. “We also have a system in place to count footfalls at our stores,” says Manmohan Sharma, manager, corporate affairs, Vishal Retail Ltd. Megamart, though, has yet not shown interest in store floor and space optimisation technology. To retain customers in the highly competitive environment, retailers are often occupied with planning and formulating ways to hook customers to their side. However, the customer’s mind is ‘fickle and wavering’. As customers seek best deals and good shopping experience, the expectations have to be lived up to by providing excellent service. Although customers are sensitive to in-store experience, they are drawn to stores by attractive schemes and offers. Therefore, building a database to tap customers’ transaction information is what retailers are doing to deliver loyalty benefits to regular and faithful customers.

This is another space where technology can come in handy to achieve business objectives. As Kunders of Arvind Retail says, “Our IT-enabled customer loyalty programme, ‘SmartOne’, effectively communicates special offers to customers by SMSes and emails.” The retailer has also recently tied up with i-mint.

Gupta of Shopper’s Stop Ltd says, “Our retail solutions offer us the capability to create promotions and schemes across multiple combinations. The business intelligence solutions give us the ability to micro-segment and understand our customer preferences.”

Sharma of Vishal Retail notes, “We are in the process of starting customer loyalty programmes, which will surely add to our customer base.” He, however, believes the company is effectively catering to the customer’s requirements in all respects, such as providing them best price, best quality products and best in-store experience. “We believe the only way to retain customers is by providing them with the best experience and we are restlessly doing that,” he proudly states.

Mukherjee of Spencer’s Retail Ltd says the company has SAP and POS promotion management systems that have been built to handle multiple promotions. “A co-branded credit card with reward points for purchases is also in place. There is also a proposal to implement an integrated loyalty system and the development has started,” he adds. Retail solutions offer the capability to create promotions and schemes across multiple combinations. And the business intelligence solutions give the ability to micro-segment and understand customer preferences.

For unforeseen and unpredicted situations, including the sudden increase in demand, Vishal Retail is ready with technology and manpower “Every Vishal store is equipped with an IT server and high-speed connections to share required information. “The store managers respond very well with the help of all these systems to make responsible people aware of any unexpected demand coming up at their level,” says Sharma.

Arvind Retail (Megamart) has also put up a dedicated IT help desk to provide immediate response to stores.

Just to avoid customers being hassled with long queues and long wait time, the operations team of Shopper’s Stop ensures that tactical needs are addressed swiftly. “We always have some POS terminals and other associated hardware available at our stores to address sudden surges, as well as breakdowns, if any,” Gupta says.

In any retail technology setting, multiple layers of information are accumulated over a period of time and remain enclosed in various storing devices from input devices positioned at different locations. Such a mishmash of information can be made available in a useful manner to gain advantage over competitors. Retail businesses take unexpected spins, depending upon the changing economic conditions and varying market dynamics at the local and global levels. And, as mind-boggling targets are given to employees, availability of precise and timely information can give the retailer an edge over competitors. The business intelligence solution of Shopper’s Stop provides it the ability to micro-segment and understand preferences of customers.

Gupta says, “Once a retailer has achieved the basic operational benefits from technology, business intelligence (BI) and data warehousing (DW) can help move to the next level of performance. Our BI/DW journey is a continuum and the insights are welcome, which does have an impact on performance.”

Kunders, however, feels it is too early for them to comment on the impact on top line and bottom line “as we have just gone live with Oracle Retail BI”.

But Vishal Retail is upbeat about the use of BI. “In response to intense competition and changing customer behaviour, we believe it becomes important to have business intelligence and strong analytical skills,” says Sharma. With BI, enterprises become capable of improving sales and managing good margins even during recessionary times. “This is very important, considering we are providing best prices to our customers,” he adds.

Spencer’s, too, expects BI and analytic tools to drive strategy. “We are still in a formative stage as far as being fully data-driven in our decision-making. The bottom line improvements have happened over the last 12 months,” says Mukherjee.

According to Gupta, they retain data based on “agreed (with the business) lineage”. The data warehouse can help the retailer go deep in the past to offer it various benefits in the present and future. At Spencer’s, SAP implementation across the organisation started in 2006 and was over in 2008. The data is easily available from the date any DC/store became a part of its integrated system.

Megamart, too, has implemented forecasting and merchandise planning solutions.

9 Data Security
As data security is a major concern for most retailers, it becomes mandatory for them to use secure software to prevent the data from any kind of threats.

A few Indian retailers, such as Pepe, have faced virus-related problems in the past. Even Hidesign has faced such problems occasionally and hence has formed a core team to help it upgrade its existing IT infrastructure. Titan, too, has experienced occasional virus attacks in certain areas. However, now they have a process established to protect their business data.

For virus protection, The Turtle has implemented a firewall, anti-spam and anti-virus solution across its machines and has not suffered any losses so far. Aditya Birla Group too has a fully secured system environment, which constantly checks vulnerabilities from internal/external sources. Till date, the Group has not encountered any such malicious software attacks.

10 Optimising the Investment
It took some time for traditionally driven companies to use IT solutions to make their business processes organised and simple. However, the IT sector has extended its services to almost every retailer in the industry and it now appears that no organisation can perform to its optimum level without the help of IT/ITeS.

In today’s rapidly changing global market, an efficient IT infrastructure has become all the more significant, especially because it can help increase productivity, lower costs and help retailers adapt quickly to the evolving market conditions worldwide.

As retail progresses and faces roadblocks, too, the expectations from technology to provide cheap and effective solutions has increased tremendously. Going forward, retailers will have to speed up the process of adopting technology and reaching high levels of IT maturity (front-end and back-end). IT retail solution providers, on the other hand, need more understanding of the unique Indian retail landscape and provide solutions accordingly. Retailers and service providers need to aggressively commit themselves to understand and practice retail knowledge for the good of both.

Present-day retailers have large aspirations, both in terms of the number of stores as well as the number of formats. They want a technology that will scale across formats and will scale at a point where they have hundred of stores. They do not mind investing in world-class solutions. The retailers across verticals and formats are, in fact, going for world-class technology solutions, investing in the right hierarchies and organisational structures as a realisation of the importance of technology. They know that retail is essentially an efficiency play. Technology just needs to keep abreast!