Retail has changed dramatically in the last decade and the next 10 years will see further changes, triggered by the blurred lines between physical stores and wearables, smart homes and mobile devices. All these changes will inevitably produce mass amounts of data points that will give retailers the ability to report on future trends, financial considerations, stock management and other vital KPIs. Retailers will need to harness this data in order to capture demand and keep up with these evolving trends – a difficult, but not insurmountable task.
According the 2016 Total Retail Survey, 32% of consumers surveyed say that they would be happier if they could check another store or online stock quickly while shopping. If the retailer does not have this real time data available, there is a risk of lost sales. Customers have less time and more choice, so the quality of the experience is key. According to research, 87% of CFOs agree that meeting growth targets requires faster data analysis, but only 12% have the ability to respond to information requests in real time. This impediment to growth will only worsen as the enterprise scales.
Retail is a complex industry, but customers want a simple and accessible experience, which is where processes come into play. Software such as SAP Business One can help retailers improve the customer experience by offering simple and consistent experiences to customers while integrating supply chains or linking the virtual and physical stores seamlessly. Digital disruptions are inevitable in the future, so retailers must have a system that can flex and change with future disruption while supporting the existing assets and processes.
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‘Change before you have to’ – Jack Welch
Many retailers understand that digital has changed the industry forever. In fact, 90% of CEOs believe that digital will have a major impact on their industry in the future, but only 25% have a plan in place and less than 15% are funding and executing on plans. If the writing’s on the wall, why are retailers struggling to keep up? In our 25 years of retail experience, we’ve seen the two major impeding factors: culture and legacy technology. In some cases, both can be too complex and inflexible to handle change.
So what is the answer to complexity? Simplicity
The 200 biggest companies in the world lose over 10% of their annual profit because of complexity (that’s about $237 billion annually). Simplifying processes drives innovation and opens the business to unification. Rather than being distracted by processes, you can focus on your customers, unifying the customer experience across channels, empower staff and inform management decisions. We have covered this in a previous post on the benefits of unification and it’s a topic that comes up consistently. We can no longer run our enterprises in various silos; it’s time for unification and simplification. Retailers must adapt and respond to the digitalisation of retail to grow margins, reduce costs and simplifying their organisations.
SAP runs simple – it’s the foundation of their business. Simplifying the complex to give control back to the retailer in a flexible, secure and real time platform. Unlike other systems that came from hardware, SAP was built in the cloud and benefits from scalability, security, efficiency and affordability.
SAP’s digital business framework is based on five key pillars of a digital transformation plan:
If you have questions around the five key pillars, or even just one area, please contact our retail experts who can outline how SAP can help your retail enterprise.
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