With the tools available to today's consumer, there has been exponential growth in the number of multi-channel retail shoppers. That value consciousness among consumers is leading many retailers to rethink traditional distribution concepts.
At Circuit City Stores Inc, a specialty retailer of consumer electronics, a major technology transformation is underway. "We're moving away from the highly customized point-of-sale (POS) systems we currently operate to an open standards system that still allows us to offer existing services, such as express pickup," explains Michael Jones, senior vice president, chief information officer at Circuit City. That transformation is being fueled, in part, by fulfillment solutions from Yantra Corp.
In the view of Mike Grandinetti, Yantra's senior vice president & chief marketing officer, multi-channel customers value convenience, want to be able to buy on their own terms, and are going to leverage every possible channel in making a buying decision. Yantra offers retailers synchronized fulfillment for every customer interaction.
"This new technology initiative, vital part of our store revitalization effort, will move our store systems customized, proprietary systems to based on open standards," says Jones. "Our current POS systems, which contain a feature set designed in the mid-1980s, are overly complex and restrict our business expansion. The new systems will allow us to adopt leading practices and improve store systems integration while optimizing store infrastructure costs."
In addition to Yantra, IBM Corp. is providing secure wireless handheld POS systems as well as consulting services. POS technology from 360commerce will offer faster, more efficient customer checkout, including "best deal" and cross-channel features.
Using IBM hardware and database software as well as its other new in-store systems, Circuit City will have greater data warehousing capabilities. This will permit greater visibility and analysis of data from all company operations.
Many consumer electronics retailers have grown through acquisition, adding single stores or small regional chains, bringing with them legacy systems and a myriad of brands. Frustrating to the consumer in these situations is that they've had to deal with each channel and brand separately, since every channel and brand had its own legacy system and none communicated with each other. One goal for Circuit City is the unification of all brands and channels, so customers feel they are dealing with one company.
Yantra's business process platform will bring together all of the legacy code and treat it as if it's part of the unified supply chain system, with one central order repository. Yantra is the connective tissue holding together all legacy systems and products.
"Regardless of whether the consumer ordered on line, bought through a call center, or purchased at a store kiosk or at the POS system at the store, all order information is now available," explains Grandinetti. When returning items, for example, customers don't have to prove that they bought from Circuit City. It's all part of the store order management umbrella. It turns out that a return is nothing more than a reverse order."
Further, the company is providing some other services that speak directly to the consumer.
A store order management capability lets a consumer know they can place an order on the web, and pick it up in the store. That helps address the needs of a multi-channel shopper and can add to a store's bottom line, since when customers come to a store to pick up their order, they might just stick around long enough to shop for other products while they're there.
When finalizing an order, whether in a store or on the web, in that single transaction the customer gains a complete understanding of what day and what window of time the delivery truck will show up at the house. In that same window, if required, a skilled team of service technicians will also arrive and install a system. That capability is made possible by the synchronized fulfillment technology.
"The burden had always been on the customer to handle all of these logistics, and more often than not, one piece or another of the equation fell apart," notes Grandinetti. Now, Circuit City is able to provide coordinated service and delivery scheduling wrapped around the installation.
Circuit City Stores Inc. www.circuitcity.com
IBM Corp. www.ibm.com
Yantra Corp. www.yantra.com
Here's a brief look at other retail enterprises that are moving to meet increased consumer demands by implementation of innovative solutions.
Solving some big problems
The clothing retailer's choice was to combine a warehouse management system from Manhattan Associates (www.manh.com) with a portfolio merchandise management system from JDA Software Group (www.jda.com) for its sortation needs — it can now turn a truck in a bit over an hour, something that used to take two to three days.
For its clustering, demand and seasonal planning requirements, Casual Male will use JDA's data mining solution.
"The technology gives us a modernized architecture that is helping save time, support our growth and control inventory costs throughout our complex, multi-channel supply chain," says Dennis Hernreich, Casual Male's executive vice president, COO and CFO.
Bringing knowledge home
As the number of goods and package configurations has grown, Franklin needed a way to better manage over-and under-stocks for its retailers and to develop more accurate demand plans that could no longer be handled on Excel spreadsheets.
The answer has been implementing retailer-centric software from Prescient Applied Intelligence (www.prescientsystems.com). In addition to enhanced demand planning data, Franklin has been able to automate input of point-of-sale data to get a better understanding of true product demand. The company is now more comfortable in understanding and anticipating spikes in seasonal demand.
In the face of tighter margins, SKU proliferation and retailer mandates, improvements through technology has helped Franklin to increase its efficiency throughout its global supply chain and to enhance its relationships with its customers.
"Since this is a significant overhaul of information systems we've had in place for 12 years, we wanted to make sure the new technologies met our strict criteria for reliability, serviceability and accessibility," says John Kovac, vice president of information technology for Liz Claiborne.
The aim of the renovation and upgrade is to improve overall operational efficiencies, increase operations and sales visibility throughout stores, while freeing store management and personnel to focus on transforming the overall customer experience.
Liz Claiborne's first move is to overhaul store-based technology and replace the outdated POS system with 1,000 point-of-sale terminals from Fujitsu (www.fujitsu.com). Additionally, stores will use handheld scanners from Symbol Technologies Inc. (www.symbol.com) for inventory control.