Transcript Retail Industry Review & NCR

Group:
Valeria Antonio-Policarpo
Maria Grant
Lashanda Gray
Bonnie Johnson
Marie Johnson
Hisham Khalafalla
John Mascaritolo
EBA 612 – Issues in Cotemporary Business
Professor Dr. James Coleman
March 11, 2006
Retail Industry Review
Use of Store Automation
NCR
Situation Analysis
Topics
Retail Industry – Use of Store Automation
• Effects, Major Threats and Opportunities of Rapid
Deployment of E-Commerce Networks/Net Enhanced
Organizations (NEO)
• Effects, Major Threats and Opportunities of Economic
Globalization and Outsourcing
Retail Industry
Rapid Deployment of
E-Commerce Networks/Net
Enhanced Organizations (NEO)
Effects, Threats and Opportunities
Effects of Rapid Deployment of NEO
over Last Five Years
Maximization of Store Productivity &
Performance:
Source: www.ncr.com
• Immediate price changes and increased competitiveness.
• Reduction of incorrectly priced products.
• Better control of inventory.
• Predictions of out of stocks on fast moving or volatile
merchandise data mining tied to store performance.
• Reduction of operating expenses.
• Warehousing and supply chain efficiencies.
• Reduction in inventory misplacement and theft.
• Cost control.
Technologies:
• NCR NCR RealPrice (Electronic Shelf Labels)
• NCR Teradata (Data Warehousing, CRM, E-business,
Financial Management, Profitability Analytics, Demand
Chain Management and Supply Chain Intelligence)
• NCR EasyPoint (Web Kiosk)
• RFID tags
• Check 21
Source: www.ncr.com
Effects of Rapid Deployment of NEO
over Last Five Years - Cont
Customer Service & Satisfaction
Enhancement:
• Redeployment of labor from the front-end to other
areas within the retail environment better assisting
customers with purchases.
• Increased customer loyalty and improved customer
service throughout the store.
•Shortening lines and wait times.
• Self-service, providing customer integration, with
the goal of customer outreach (i.e. placing deli order
in a supermarket with a kiosk rather than an
employee; price checkers).
• Convenience of online shopping.
Technologies:
• NCR FastLane - Self-Checkout machines
• NCR EasyPoint (Web Kiosk)
• Online shopping
Source: www.ncr.com
Effects of Rapid Deployment of NEO
over Last Five Years - Cont
Labor Costs Reduction &
Enhanced Productivity:
• Redeployment of labor from the front-end to
other areas within the retail environment.
• Reduced labor costs.
• Identification of cashier productivity
optimization.
• Training time reduction for new employees.
• Customer self-service.
Technologies:
• NCR FastLane - Self-Checkout machines
• NCR POS Operator Interfaces
Source: www.ncr.com
• Teradata (data warehousing)
• NCR EasyPoint (Web Kiosk)
Competitive Advantage :
• Operational and historical detail data
connectivity into a centralized data
warehouse.
• Effective inventory tracking.
Technologies:
• NCR Teradata (Data Warehousing,
CRM, E-business, Financial
Management, Profitability Analytics,
Demand Chain Management and
Supply Chain Intelligence)
• RFID tags
Continue Deployment of NEO
over Next Five Years
Threats:
• Bandwidth, access, and storage
not contemplated.
•An Avalanche of Data.
•Implementation costs.
•Downturn in ROI.
Opportunities:
• Create closed wireless network which
broadcasts store-related information on
services and advertisements to
consumer’s PDA, cell phones and laptops.
This advertising can be localized and
eventually personalized.
• For those areas without a high PC
concentration, but high cell phone usage,
integrate mobile services with websites.
• Streamline operational functions by
electronically routing all functions that
were once manual. Also links between
retail and banking services creates a
"straight-through" processing.
Retail Industry
Economic Globalization and
Outsourcing
Effects, Threats and Opportunities
Effects of Globalization and
Outsourcing over Last Five Years

Five years ago, people were just getting comfortable with the
internet and how to purchase products on-line with confidence.

On-line retailers were not that abundant offering merchandise online for sale. Their activity and presence was just as limited as that of
the consumer looking to buy.

What made the growth in on-line purchase activity was the role
outsourcing companies took that helped make the sell to buy process
very transparent.

The outsourcing companies brought the expertise of warehousing,
order fulfillment, transportation, and help desk/customer service
support to the major retailers.

Retailers had their suppliers drop ship merchandise directly to the
outsource partners, thus eliminating major investments in capital
assets.

Outsourcing offers the way the retailer can become more focused on
developing a solid strategy for growth without carrying extra costs.
Effects of Globalization and
Outsourcing over Last Five Years - Cont

Outsourcing lets the retailer concentrate on their core
business and eliminate the hassles of doing time wasted
functions like warehousing and order picking.

Brick and mortar is not the way to expand in today’s
competitive market. It is faster to have your product
warehoused remotely when people place orders on-line to the
retailer’s web site. eCommerce has allowed this expansion
capability that stationary businesses are not able to do.

The outsourcing companies have developed and expanded
globally over the past several years and through this grow the
opportunity for globalization became a reality for the retailer.
Outsourcing coupled with the use of the internet allows the
retailer’s product to be available anywhere in the world.

The increased demand for information technologists in
today’s economy and shortage of skilled labor and global
business expansion, promoted US retail companies to
outsource many tasks to other countries.
Effects of Globalization and
Outsourcing over Last Five Years - Cont

Currently, jobs are outsourced to many countries including
Egypt, India, Ireland, Israel, Malaysia, Hungry and the
Philippines. Goods are manufactured all around the globe and
mainly in China.

Outsourcing is a trend that is driven by necessity in most
cases and it is clear that in the companies benefit from
outsourcing by reducing their operating costs and expand to
new and emerging markets in many cases.

Substantial savings can be achieved for retail companies by
outsourcing activities and manufacture goods around the
globe.

Retail companies are able to offer relatively low prices to
consumers regardless of their location. Consumers now can
expect to pay almost same prices for goods in their home
country as well as when abroad.
Continued Economic Globalization
Over the Next Five Years
Threats:
Opportunities:
• Failure of timely Store Automation
Implementation.
• Emerging countries (Chile, China, and India) are
experiencing impressive GDP growth rates
creating tremendous opportunities for retailers.
• Failure to take advantage of 3rd
party outsourcing opportunities.
• Cost of Store Automation
investment.
• Increased rivalry threatens market
share.
• Global demand for food products
stagnates.
• Growing middle class in emerging countries –
purchasing power on the upswing - enabling
consumers to buy more products and become
increasingly demanding.
• Global consumer growth due to the increasing
use of the internet.
• Foreign markets have increased profitability for
retailers which can be leveraged.
• Tenant shops at airports are growing as the
percentage of people traveling through airports
worldwide are growing in double digits.
• Interactive mail-order shopping terminals are
becoming increasingly popular.
Q&A