You are on page 1of 25

IT IN RETAIL SECTOR

Implementation of Information Technology in the Retail Sector


4/30/2012

FO-78 FO-87 FO-92 FO-93 FO-97

ARATHI V. AKHIL RAJ K R DHANANJAY A KUMAR MOHAMED FEBIN SAGAR SIVAN

NTRODUCTION
Retailing is a distribution channel function where one organization buys products from supplying firms or manufactures the product themselves, and then sells these directly to consumers. A retailer is a reseller (i.e., obtains product from one party in order to sell to another) from which a consumer purchases products.. In the majority of retail situations, the organization from which a consumer makes purchases is a reseller of products obtained from others and not the product manufacturer. But as we discussed in the Distribution Decisions tutorial, some manufacturers also operate their own retail outlets in a corporate channel arrangement. While consumers are the retailers buyers, a consumer does not always buy from retailers. For instance, when a consumer purchases from another consumer (e.g., eBay) the consumer purchase would not be classified as a retail purchase. This distinction can get confusing but in the US and other countries the dividing line is whether the one selling to consumers is classified as a business (e.g., legal and tax purposes) or is selling as a hobby without a legal business standing. As a reseller, retailers offer many benefits to suppliers and customers as we discussed in the Distribution Decisions tutorial. For consumers the most important benefits relate to the ability to purchase small quantities of a wide assortment of products at prices that are considered reasonably affordable. For suppliers the most important benefits relate to offering opportunities to reach their target market, build product demand through retail promotions, and provide consumer feedback to the product marketer. One of the key factors in achieving an organized and efficient retail operation is the use of technology as an enabler. Information Technology is the key enabler to improving customer satisfaction, operational efficiencies and by extension, profitability. Technology has been the great enabler of business and especially retail enterprise. We are now wireless and seamless and cashless and everything less and can get any information we want and need. A typical pan national retail operation would have multiple regional warehouses, offices and retail outlets. In such an operation, how does the headquarters know the daily turnover at each of its outlets, how does it know which products are selling the most in which region at which outlet, how does one store know if a stock out item in its own inventory is available at another store location for whom it is slow moving item? Most of these issues can be solved by the appropriate use of technology.
Page | 1

INFORMATION TECHNOLOGY IN RETAILING


INFORMATION TECHNO LOGY IT (information technology) is a term that encompasses all forms of technology used to create, store, exchange, and use information in its various forms (business data, voice conversations, still images, motion pictures, multimedia presentations, and other forms, including those not yet conceived). It's a convenient term for including both telephony and computer technology in the same word. It is the technology that is driving what has often been called "the information revolution." Encompassing the computer and information systems industries, information technology is the capability to electronically input, process, store, output, transmit, and receive data and information, including text, graphics, sound, and video, as well as the ability to control machines of all kinds electronically. INFORMATION TECHNOLOGY IN BUSINESS Information technology (IT) has become a vital and integral part of every business plan. From multi-national corporations who maintain mainframe systems and databases to small businesses that own a single computer, IT plays a role. The reasons for the omnipresent use of computer technology in business can best be determined by looking at how it is being used across the business world. Communication For many companies, email is the principal means of communication between employees, suppliers and customers. Email was one of the early drivers of the Internet, providing a simple and inexpensive means to communicate. Over the years, a number of other communications tools have also evolved, allowing staff to communicate using live chat systems, online meeting tools and video-conferencing systems. Voice over internet protocol (VOIP) telephones and smart-phones offer even more high-tech ways for employees to communicate. Inventory Management When it comes to managing inventory, organizations need to maintain enough stock to meet demand without investing in more than they require. Inventory management systems track
Page | 2

the quantity of each item a company maintains, triggering an order of additional stock when the quantities fall below a pre-determined amount. These systems are best used when the inventory management system is connected to the point-of-sale (POS) system. The POS system ensures that each time an item is sold, one of that item is removed from the inventory count, creating a closed information loop between all departments. Data Management The days of large file rooms, rows of filing cabinets and the mailing of documents is fading fast. Today, most companies store digital versions of documents on servers and storage devices. These documents become instantly available to everyone in the company, regardless of their geographical location. Companies are able to store and maintain a tremendous amount of historical data economically, and employees benefit from immediate access to the documents they need. Management Information Systems Storing data is only a benefit if that data can be used effectively. Progressive companies use that data as part of their strategic planning process as well as the tactical execution of that strategy. Management Information Systems (MIS) enable companies to track sales data, expenses and productivity levels. The information can be used to track profitability over time, maximize return on investment and identify areas of improvement. Managers can track sales on a daily basis, allowing them to immediately react to lower-than-expected numbers by boosting employee productivity or reducing the cost of an item. Customer Relationship Management Companies are using IT to improve the way they design and manage customer relationships. Customer Relationship Management (CRM) systems capture every interaction a company has with a customer, so that a more enriching experience is possible. If a customer calls a call center with an issue, the customer support representative will be able to see what the customer has purchased, view shipping information, call up the training manual for that item and effectively respond to the issue. The entire interaction is stored in the CRM system, ready to be recalled if the customer calls again. The customer has a better, more focused experience and the company benefits from improved productivity.

Page | 3

Changing Technology IN Retail Industry Over the past few years, the rapid consumer adoption of emerging technologies has completely changed shopper behavior. From group-buying to flash sales, mobile commerce to social media, both retailers and consumers alike continue to adapt to the new ways they interact with each other. Many retailers we cover discussed multichannel initiatives on yearend conference calls, but perhaps nobody said it better than Glen Senk, the CEO of Urban Outfitters: "We have begun to test mobile technology in our stores. We know that our best customers shop across channels and that there's tremendous synergy between the stores, catalogs and websites. Our goal is to provide an outstanding, seamless multichannel experience wherever, whenever our customer wants to shop. For retail it is the detail that matters. The industry pundits are in agreement that it is not accurate for us to generalize the trends that are tiding the retail industry as a whole. For instance a fashion apparel retailer's IT strategy and the IT strategy of a multinational grocery retailer will and should be different. This difference is primarily in the detail. Having said that, at a high level the global retail industry, be it the fashion apparel retailer or the multinational grocery retailer are having the same tidings. Industry consolidation - In most of the countries of the world, the rate of increase of retail revenues is greater than the rate of increase in number of retailer outlets. A very strong trend observed is that in most countries 'one-stop shopping' is on the boom. Country peculiarities - Retail is where you need to be both local and global at the same time. Service providers need to understand the fact that local legislation is designed in countries as diverse as the US and China. Local demographics and macroeconomic trends - The performance of retailers is highly susceptible to local trends in population, income growth, and fluctuations in propensity to save or spend. Channel and payment modernization - Each country or region seems to be following its own modernization roadmap. Because of local culture variations in telecommunications and financial deregulation, the pattern of retailing innovation is widely varied within non-store retail sales like vending, home shopping and Internet sales. Local culture and legislation, as
Page | 4

well as institutional / banking infrastructure, also significantly affect the adoption of retail payment innovations.

Opportunities for IT in Retail Unorganized Retail market in India Entry of Foreign players in Indian Retail Increasing Spending power of the Indian consumer Changing pattern of Consumption in India Increasing Urban population-more participants in Retail industry Increasing Demand for lifestyle products and esteem enhancing products. Increase in use of cash-less shopping, i.e. use of credit/debit cards Fulfill consumer demand on time Better distribution channels

IT Innovations in Retail Customer identification using RFID: This involves identifying customers by issuing them smart cards embedded with smart chips. These cards would be RFID enabled and would give information regarding the customer like his preferences, shopping behavior etc. E-Catalog based selling: Here a limited range of merchandise is available in-store, while the range of a hyper format is made available through self-browse kiosks. Mobile Point of Sale (POS): This would enable the purchase of goods while putting them in a shopping cart. The customer would be spared the hassle of standing in long queues. Digital Signage: Static signboards have not proved beneficial in terms of helping a customer track a product. Digital signboards integrated with an automated tracking system can make this easier.
Page | 5

Intelligent database: A detailed database of the customer is made available online and helps the retailer understand a particular customers buying characteristics.

How Information Technology involved in Retailing Operations Forecasting: Forecasting is the process of estimation in unknown situations. It's an essential and very important process in any business organization. Business leaders and economists are continually involved in the process of trying to forecast, or predict, the future of business in the economy. Business leaders engage in this process because much of what happens in businesses today depends on what is going to happen in the future.

1. Retail Demand Forecasting: Modern demand-forecasting systems provide new opportunities to improve retail performance. Although the art of the individual merchant may never be replaced, it can be augmented by an efficient, objective and scientific approach to forecasting demand.

Large-scale systems are now capable of handling the mass of retail transaction data organizing it, mining it and projecting it into future customer behavior. This new approach to demand forecasting in retail will contribute to the accuracy of future plans, the satisfaction of future customers and the overall efficiency and profitability of retail operations. Inventory Management: Inventory can be either raw materials, finished items already available for sale, or goods in the process of being manufactured. Inventory is recorded as an asset on a company's balance sheet. To optimize the deployment of inventory, retailers need to manage the uncertainties, constraints, and complexities across their global supply chain on continuous basis. This allows them to improve their inventory forecasting ability and accurately set inventory targets. An IT solution is a proven and market leading solution for determining optimal time-varying inventory targets for every item, at every location throughout supply chain. This allows retailers you to significantly reduce inventory without adversely affecting service levels. Store Management: Another example where Information technology can be beneficial is a store management. That alerts out-of-place or stock-out items. A store,
Page | 6

commonly a shop or stall for the retail sale of commodities, but also a place where wholesale supplies are kept, exhibited, or sold. A place where something is deposited for safekeeping is called store. The in-store system use magnetic strips or barcodes or RFID to monitor actual versus intended product location on the floor or in the stockroom.

Retail's Complexity: the Information Technology Solution

Much of the retail operations functionality is driven by customized point solutions in areas such as merchandizing, supply chain management, in-store operations, seasonality and promotions planning. This means the underlying IT systems to drive operations are equally complex.IT systems are at the heart of retail operations and hence play a central role in alleviating pressure points in the retail sector. The converse also holds trueretailers who do not manage their IT landscape effectively will find that, in time, the IT systems become part of the problem rather than components of the solution.

FUNCTIONAL RETAIL AREAS Merchandizing systems impact top-line revenues and need to be configured, customized and managed effectively for the retailer to improve its top line. To achieve this, retailers need to effectively mine large amounts of data and leverage this data to carry out effective forecasting, assortment planning, and collaboration with its suppliers so that promotions and other merchandizing activities are effective and efficient. Supply chain systems are key from a bottom line point of view as they play a key role in getting the right product to the right place at the right timewhich in turn impacts the inventory levels and the rate of flow of

Page | 7

products through the retailer's stores, both of which are significant components of the retailer's cost of doing business. DATA CLEANSING AND ARCHITECTURE IMPROVEMENT Data cleansing, and thereafter, effective mining (via large data warehouses) is fundamentally important in the retail space because so much decision-making is based on data. If the data is bad, the effectiveness and efficiency of carrying out retail operations is hampered. This becomes particularly crucial when the retailer is implementing new systems and a large data conversion effort is requiredit becomes essential that the old data be effectively cleaned, re-architect and made ready in the new system, so that the business functions can make decisions effectively. In challenges, place ever-greater demands on retailers. It systems are at the complexity of products, scale and processes, along with supply chain heart of retail operations and hence play a central role in alleviating pressure points in the retail sector.

New Technologies Evolved in Retailing 1. Radio Frequency Identification (RFID)

Radio frequency identification (RFID) is a rapidly growing technology that has the potential to make great economic impacts on many industries. While RFID is a relatively old technology, more recent advancements in chip manufacturing technology are making RFID practical for new applications and settings, particularly consumer item level tagging. These advancements have the potential to revolutionize supply-chain management, inventory control, and logistics.
Page | 8

At its most basic, RFID systems consist of small transponders, or tags, attached to physical objects. RFID tags may soon become the most pervasive microchip in history. When wirelessly interrogated by RFID transceivers, or readers, tags respond with some identifying information that may be associated with arbitrary data records. Thus, RFID systems are one type of automatic identification system, similar to optical bar codes.

There are many kinds of RFID systems used in different applications and settings. These systems have different power sources, operating frequencies, and functionalities. The properties and regulatory restrictions of a particular RFID system will determine its manufacturing costs, physical specifications, and performance. Some of the most familiar RFID applications are item level tagging with electronic product codes, proximity cards for physical access control, and contact-less payment systems. Many more applications will become economical in the coming years.

Applications.

Early commercial examples of RFID applications include automatic tracking of train cars, shipping containers, and automobiles. Railroad cars were originally labeled with optical bar code labels for tracking. These labels began to deteriorate and be obscured by dirt, causing reads to fail. As a solution, railroad companies began to tag railcars with RFID devices. By 1994, these devices were mandatory and nearly every railcar in the United States was tagged.

As manufacturing costs dropped, RFID systems began to be used for lower-value items in industries besides transport. An example is in animal identification of both pets and livestock. Glass-encapsulated RFID devices have been implanted in millions of pets throughout the United States. These tags allow lost animals to be identified and returned to their rightful owners. These tags have a very short read range. Like bar codes, RFID tags identify items. However, unlike bar codes, which must be in close proximity and line of sight to the scanner for reading, RFID tags do not require line of sight and can be embedded within packages. Depending on the type of tag and application, they

Page | 9

can be read at a varying range of distances. In addition, RFID- tagged cartons rolling on a conveyer belt can be read many times faster than bar-coded boxes. RFID in retail helps in the following ways: (a) Improves the level of customer service (b) Increases customers loyalty (c) Better Inventory Management (d) Item level tracking

2. Smart Operating System Supply chains can look very different from industry to industry. But companies across industries share a common challenge -- finding ways to better manage growing uncertainty and complexity to improve supply chain performance. To improve their supply chains, companies across industries have made sizable investments in a range of technology solutions, yet significant profitability improvements have remained elusive. Largely unaddressed has been the opportunity to use enterprise and supply chain data to support key inventory planning decisions that fuel execution systems and activities -something beyond a mere spreadsheet or desktop solution. SmartOps customers are proactively managing supply chain uncertainty across all stages to improve their total chain inventory planning, so that their customer service levels can be stabilized and even increased while overall costs to the business are minimized. SmartOps enterprise software solutions support many initiatives and challenges associated with different manufacturing and distribution industries from Lean Manufacturing, Just-InTime (JIT), and Six Sigma initiatives, to postponement strategies, to Collaborative Planning, Forecasting, and Replenishment (CPFR), and Sales & Operations Planning (S&OP) activities. SmartOps inventory optimization algorithms manage uncertainties in the data and offer visibility into the drivers of inventory at the item-location-time period level of detail. SmartOps is able to do that because it looks at the right granularity of data to adequately

Page | 10

manage safety stock levels and understand where the biggest ongoing opportunities for improvement are within their supply chains. 3. Point of Sale Capturing data at the time and place of sale. Point of sale systems use computers or specialized terminals that are combined with cash registers, bar code readers, optical scanners and magnetic stripe readers for accurately and instantly capturing the transaction. Point of sale systems may be online to a central computer for credit checking and inventory updating, or they may be stand-alone machines that store the daily transactions until they can be delivered or transmitted to the main computer for processing. Point of sale (POS) systems is electronic systems that provide businesses with the capability to retain and analyze a wide variety of inventory and transaction data on a continuous basis. POS systems have been touted as valuable tools for a wide variety of business purposes, including refining target marketing strategies; tracking supplier purchases; determining customer purchasing patterns; analyzing sales (on a daily, monthly, or annual basis) of each inventory item, department, or supplier; and creating reports for use in making purchases, reorders, etc. Basic point of sale systems currently in use includes standalone electronic cash registers, also known as ECRs; ECR-based network systems; and controller-based systems. All function essentially as sales and cash management tools, but each has features that are unique. INFORMATION SYSTEM IN RETAIL INDUSTRY SAP

RETAIL INFORMATION SYSTEM

SAAS

Retail management involves running a store where merchandise is sold. Retail management information systems include the use of hardware, software and procedures to manage activities such as planning, inventory control, financial management, logistics and point of

Page | 11

sale transactions. Use a retail management information system in your business when you need to manage your store, finances and inventory from one office. Retail management information systems support distributed stores by linking them. By allowing the instant exchange of information, store managers can stay in contact to more effectively control profits for the whole company. The system should support product management. It should also enable detailed analysis of customer data. A flexible system allows managers to set prices for variable time periods based on the store location. To meet the needs of sales and inventory managers, retail management information systems include a mobile user interface. Supporting the basic functions of procurement, storage and delivery, a retail management information system allows a manager to manage customers, inventory, suppliers and product sales. The system allows you to track purchase orders and update inventory records dynamically. You can analyze cash, check and credit card transactions to reconcile information. Improve efficiency by examining overage and shortages to reveal trends that can be rectified.

Retail management information systems can be customized for each industry, including, for example, fashion, department store, supermarket, furniture or prescription drugs. Some systems support multiple languages, currencies, tax systems and cost structures. In addition, some retail management information systems can support different business models such as franchise, consignment, direct sales or online Integration The Retail Information System is a component of the Logistics Information System. The Logistics Information System is divided into the following information systems: Sales Information System (SIS) Purchasing Information System (PURCHIS) Inventory Controlling (INVCO)

Quality Management Information System (QMIS)

Retail Information System (RIS)


Page | 12

DATA MINING IN RETAIL Micro Marketing

Application of data mining whereby retailer uses differentiated marketing and develops focused retail strategy mixes for specific customer segments, sometimes fine-tuned for the individual shopper.

SAAS- SOFTWARE AS A SERVICE

A Software as a Service (SaaS) provider is a company that offers individuals or enterprises access over the Internet to applications and related services that would otherwise have to be located in their own personal or enterprise computers. SaaS solutions are expected to become an important alternative, not only for smaller companies with low budgets for information technology, but also for larger companies as a form of outsourcing and for many services for individuals as well. It provides:

User training in retailing Implementation across your system Hosting of applications User support: help desk, etc. Security in retailing

SAP SAP Retail is a completely integrated retailing system. It maps the complete set of business processes required for competitive assortment strategies, different retail formats, and ECR-driven logistics and distribution. It provides all the functions necessary for modeling business processes in a retail company. With SAP Retail, SAP has endeavored to model the full "Value Chain," all the links in the logistics pipeline from consumer to vendor. Retailers can thus optimize the whole array of business processes and control checks in managing the flow of

Page | 13

merchandise and information among vendors, retailers and consumers. The business process area "Retailing" comprises the procurement, storage, distribution, and sale of merchandise. SAP Retail supports both wholesale and retail scenarios. The Retail Information System (RIS) enables goods movements to be planned, monitored and tracked throughout the whole supply chain. The key retailing processes include:

Assortment Management Sales Price Calculation Promotion Management Allocation Requirements Planning and Purchasing Goods Receipt Invoice Verification and Subsequent Settlement of End-Of-Period

Arrangements

Warehouse Management Picking and Delivery Billing Store Supply

The retailing processes enable you to control and coordinate the whole value chain, and this react swiftly to changes in consumer behavior. New trends, such as electronic commerce or ECR, flow continually into ongoing development cycles. SAP Retail also allows for changes in legal structures or business practices franchising, for example. This ensures that retailers not only have a future-proof investment but are able to adapt swiftly to a changing market. The growth of your company is not hampered by system constraints, and you can incorporate changes in the real world smoothly and efficiently into the system

Page | 14

Wal-Mart: IT Inside the World's Biggest Company Wal-Mart is big. To understand just how big, consider that on Nov. 23, 2001, the 40year-old retailer sold more than $1.25 billion worth of goods in a single day. The company has 4,457 stores, 30,000 suppliers, annual sales of more than $217 billion And one information system running centralized IS with homegrown, commonsource code gives Wal-Mart a competitive advantage and helps the company maintain one of the lowest expense structures in retail. Information System strategy The first philosophy is to run a centralized information system for operations all over the world, and we run that from Arkansas. The second is to have common systems and common platforms. The third is to be merchants first and technologists second.

Wal-Mart is more than just the world's largest retailer. It is an economic force, a cultural phenomenon and a lightning rod for controversy. It all started with a simple philosophy from founder Sam Walton: Offer shoppers lower prices than they get anywhere else. That basic strategy has shaped Wal-Mart's culture and driven the company's growth. Now that Wal-Mart is so huge, it has unprecedented power to shape labor markets globally and change the way entire industries operate. In this article, you will learn the key reasons that Wal-Mart has been able to keep its prices low -- cutting-edge technology, a frugal corporate culture and a push to make suppliers sell merchandise at cheaper and cheaper prices. We'll also take a look at the scope of Wal-Mart's impact on the economy and the controversies surrounding Wal-Mart, as well as the future of the company.

Wal-Mart Strategy Let's start with technology. Wal-Mart pushed the retail industry to establish the universal bar code, which forced manufacturers to adopt common labelling. The bar allowed retailers to generate all kinds of information -- creating a subtle shift of power from manufacturers to retailers. Wal-Mart became especially good at exploiting the information behind the bar code and is considered a pioneer in

Page | 15

developing sophisticated technology to track its inventory and cut the fat out of its supply chain.

A universal bar code Recently, Wal-Mart became the first major retailer to demand manufacturers use radio frequency identification technology (RFID). The technology

uses radio frequencies to transmit data stored on small tags attached to pallets or individual products. RFID tags hold significantly more data than bar codes. During the first eight months of 2005, Wal-Mart experienced a 16 percent drop in out-ofstock merchandise at its RFID-equipped stores, according to a University of Arkansas The frugal culture, established by Walton, also plays into Wal-Mart's success. The company has been criticized for the relatively meager wages and health care plans that it offers to rank-and-file employees. It has also been accused of demanding that hourly workers put in overtime without pay. Store managers often work more than 70 hours per week. They are are expected to pinch pennies wherever they can, even on things like the heating and cooling of the stores. In the winter, stores are kept at 70 degrees Fahrenheit, and in the summer, they stay at 73. This culture is also present at the company's headquarters. Wal-Mart is headquartered in Bentonville, Arkansas, instead of an expensive city like New York. The building is drab and dull. You won't catch executives in limousines and you won't see them dragging into work at 9:30 a.m. Executives fly coach and often share hotel rooms with colleagues. They work long hours, typically arriving at work before

Page | 16

6:30 a.m. and working half-days on Saturdays. The central goal of Wal-Mart is to keep retail prices low -- and the company has been very successful at this. Experts estimate that Wal-Mart saves shoppers at least 15 percent on a typical cart of groceries. Everything -- including the technology and corporate culture -- feeds into that ultimate goal of delivering the lowest prices possible. Wal-Mart also pushes its suppliers, some say relentlessly, to cut prices. In "The Wal-Mart Effect," author Charles Fishman discusses how the price of a fourpack of GE light bulbs decreased from $2.19 to 88 cents during a five-year period. In a 2003 Los Angeles Times article (part of a Pulitzer Prize-winning series about Wal-Mart, tells of a Wal-Mart buyer named Celia Clancy, who was in charge of clothing and demanded that each supplier either lower the price or increase the quality every year on every item. This philosophy is known as "plus one." 1. RFID Technology (Radio Frequency Identification) Retailers face the constant demand to have the right goods available at the right places in the right quantities. First and foremost, incorporating RFID technology into existing supply chain operations can reduce the labour required to monitor goods movement and inventory flow. Bar code-based tracking systems are an effective tool for basic inventory tracking. Used in conjunction with a bar code system or as a stand-alone inventory tracking application, RFID allows manufacturers and retailers to complement existing systems while gathering more information throughout a supply chain. Systems with the power to update the information that moves with an individual product provide complete supply chain visibility without the prohibitive labour costs and error rates a similar manual system would entail. RFID also can act like a security guard at a gateway. As goods are moved from dock to truck to store, RFID can conduct automatic inventories and compare the goods with the manifest. Goods flow becomes more complete, stock outs are reduced, overages are curtailed and accounting discrepancies are removed.

Page | 17

Electronic Product Codes The EPC symbol can typically be found on the price tag or product packaging. Walmart and Sams Club use electronic product code (EPC) labels to make sure the products you want are available when you need them. An EPC label is a lot like a bar code. It contains information about a product and assigns a unique number to each item, allowing retailers to distinguish one item from another.

FIELD STUDY IN RELIANCE FRESH

For the class presentation our group conducted a field study in RELIANCE FRESH to identify how IT and Information Systems are utilized in a Retail store. The findings of the study is listed below 1. The store uses RETALIX as a billing software (Frontend) 2. The Back end operations are managed by SAP software.

Page | 18

SAP SAP as all the work which is performed in the Reliance Fresh is done through SAP. SAP isactually software which is specially designed for retailing purpose, basically there are 2 kindsof software used in Retail Sector to handle all the operational work and they are called 1. RETALIX 2. SAP

But the most widely used software is SAP and with the help of SAP almost each and everywork becomes systematic and easier to do because we have not to maintain each and everymanual files if we are using SAP as once the data is entered in SAP then it is automaticallyreceived by Head Office and the most important thing is that the chance of error is reducedwhen we use SAP. In Reliance Fresh we call it as RETALIX STORELINE. Some of theimportant works which are done through SAP are as following 1. GRN 2. PO 3. PI 4. Commercial Activity 5. EOD 6. Store performance 7. Store to store transfer

These are the some major activity which is performed through SAP else each and every activity has to be entered in the SAP so that the work goes smoothly. The store utilizes RETALIX software for the billing and RLT cash transfer operations in the store. All the data are transferred to SAP database at EOD (End of Day) in about 2 hours. This enables the system to run smooth and fast as billing application by SAP would slow the system down. Apart from this, the Reliance Loyalty Card is a way of tracking customer preferences and letting the specific customers know what offers are in store pertaining to their choice of goods and products.

Page | 19

Thus it can be seen that the running of a Reliance Retail store is almost completely facilitated by IT systems from billing to stock keeping, from inventory management to customer databases. The store also utilizes IT tools like RFID devices, Scanners, Data mining for CRM etc.

INDIAS RETAIL JOURNEY


In the past few years, Indias retail journey seemed picture perfect with the most attractive stops still unexploited and under-penetrated. Favourable demographics, steady economic growth, easy availability of credit, and large scale real estate developments were fuelling the growth of Indias approximately USD 25 billion3 organized retail market. The opportunity was there for all to see and India was the destination of choice for top global retailers. In this environment, Indias own blue chip companies like Reliance, Bharti and RPG diversified to add retail to their sector portfolio4. All things considered, it was a good time for Indian retail. This was the scenario till a few months ago. Enter the global meltdown and India did not find itself completely insulated from its harsh effects. As per the Cartesian survey, almost all key industries in India have been negatively impacted by the slowdown and retail is no exception.

Page | 20

Large and medium size retailers are going through the cycle of putting a robust transaction system in place which includes a suitable POS system, merchandise management system and a CRM system. Following this investment will be made in world class supply chain and logistics management system and business intelligence and analytics systems. That said, the innovation and deployment that is taking place in India is confined to the organized sector, which is a small proportion of the overall retail industry. Also organized retail in India is comparatively new, as compared to the West where it has been since the last 50 years. Indian retail is quite advanced in basic IT adoption like ERP, network, etc. compared to foreign retailers. However they have not managed implementation well due to lack of sector understanding both with clients as well as IT consultants. Where we are also lagging is in the area of advanced IT products and solutions like replenishment planning, analytics, RFID, warehouse management systems, etc. FUTURE OF INDIAN RETAIL INDUSTRY The Indian retail industry is beginning to use technology in subtle ways to enhance customers shopping experience, by cutting down the time they spend in checkout queues and by helping them find things. And in the process, sales are rising. Globally technology has already made headway into the retail sector. Wal-Mart for instance monitors weather forecasts to predict what their customers will want to buy around that time of the year. Then there are information kiosks that display maps to guide consumers on how to find any item, and tiny devices that record customers buying preferences and makes helpful suggestions. For instance, someone who is buying an anti-dandruff shampoo might also want a similar type of conditioner Shoppers walking into Hyper-city, a mall in Mumbai, are in for a slightly hi-tech experience. Theyll see customers bustling about with tiny golf-ball-sized gadgets hooked on to their shopping carts. And this curious little gadget doesnt just sit there. Every time a shopper picks up an item, say bread, this tiny gizmo beeps, as if in agreement. Whats most interesting about this experience is that even during peak time, there are hardly any queues at the cash counter. This new shopping buddy at hyper-city is in fact a handheld scanner (I-Scan) that lets you generate your own bill as you go along picking items and adding them to your cart.

Page | 21

This cuts your shopping time by almost half, as all you have to do at the checkout counter is make the payment and leave. This device is already helping the retail outfit provide faster checkout as well as reduce staffing needs by a considerable amount. This might seem extraordinary experiment now, but analysts say gadgets like these are set to become common place within the next couple of years, replacing todays stationary cashier counters, dumb price tags and static paper signboards. Some of the technological aspects already introduced in retail industry is listed below,

I-Scan RFID chips Near field communications Intactix space planning

Page | 22

CONCLUSION In todays world of internet technology, globalization when everyone is connected and well informed; retailers have to ensure that they continuously understand the pulse of their customers and design their offerings accordingly. This requires not only in-depth understanding customer requirements but also thinking laterally to come up with innovative solutions which would make the retailers stand out of the crowd. With rapid globalization, increased connectivity and heightened awareness the consumer is much more conscious about his needs and requirements. He not only seeks to purchase a product but also the entire shopping experience, we believes that players, who can customize their offerings according to the specific needs of the Indian consumer, are likely to emerge as a leaders. Retailers have to start appreciating this fact and take out their thinking hats to plan innovative solutions for their customers. The current environment is a good time for generating trials; the consumers are actively looking for the best value and may therefore be more than willing to experiment. Internationally, with consumers currently debating over whether or not to spend their hardearned money on that next cup at Starbucks, McDonald's has a perfect opportunity to prove that their Premium Roast coffee a step up in price for McDonald's, but still cheaper than Starbucks is a pretty tasty brew The findings from this study shows that with an efficient IT system a retailer can observe sales and consumer behavior more efficiently and accurately and thus plan its sourcing and customer promotions more effectively. This result also lead to the conclusion that use of new technologies in retailing helps to increase customer loyalty and customer satisfaction. An IT system is also beneficial for various retailing related operations. Retailers need to understand that technology is not a sunk cost but rather an investment to reduce heavy long-term costs. It is an investment to maintain competitive advantage for longterm growth.

Page | 23

REFERENCE www.cci.in/pdf/surveys_reports/indias_retail_sector.pdf
http://en.wikipedia.org/wiki/Retailing_in_India http://business.mapsofindia.com/india-industry/retail.html http://www.alvarezandmarsal.com/en/about/action_matters/ITTrendsinRetail.aspx http://www.cio.com/article/31174/Wal_Mart_IT_Inside_the_World_s_Biggest_Company http://www.reuters.com/article/2007/01/16/businesspro-retail-nrf-keynotes-dcidUSN1541876420070116

Page | 24