SAP has released the findings of a survey completed in conjunction with the British Retail Consortium (BRC). The survey reveals findings from Retail Directors, including key business functions, and how they are responding to the current economic climate.
More than half (51%) of respondents are looking at different channels as a way to increase revenue and are actively developing their existing websites or moving from information-only to taking money online.
A staggering 90% of respondents plan to optimise inventory levels in the supply chain in order to better manage costs. Richard Mills, Retail Industry Principal at SAP UKI says; Retailers know that buying, supply chain and customer demand are not always working together and as such, are keen to address this. Its becoming increasingly important to get cash back out of the business more quickly. Their goal is to reduce the inventory by holding less stock in the supply chain and optimising stock in the store around customers needs.
Optimising inventory requires a range of responses, including demand-driven replenishment, forecasting, a more rapid and responsive supply chain and efficient promotions. Some retailers also make the link between optimal inventory and their environmental responsibilities, improving vehicle routing for more efficient deliveries, while at the same time cutting their transport costs. The downturn is forcing positive changes in the supply chain, accelerating ideas that have been around for some time but not widely adopted.
The phrase customer is king has never been as pertinent 54% of respondents to the survey believe that focusing on improving the customer experience will be the key driver to surviving the downturn. Retailers understand that they must respond to the fall in consumer spending now, and get closer to their customers. Retailers now have the systems and technology in place to be able to understand what data they own on their customers, where and how they are spending and understand their needs. Almost a quarter of people surveyed believe that marketing correctly to existing customers will enable them to ride the storm.
A surprising finding of the survey was that loyalty cards are in no way significant way rewarded as a source of customer insight. Retailers want to understand their customers better and dont think loyalty cards are the answer. They believe technology will however play a critical role in reaching these goals, particularly in the areas of inventory management, customer analytics, labour and task management, on line shopping, merchandising and helping to improve the customer experience.
Mills continued, Retailers are also looking at staff as a way to improve customer service. The survey showed that 35% of retailers are using technology to automate processes, not to reduce the number of staff, but to allocate their time to serving customers.
There will always be customers and those stores that offer the customer what they want will still perform well. The recession will drive some players out of the market, but those that capitalise on their investments and opportunities have a chance of coming out of the recession stronger than they ever were, Mills concluded.
SAP is the worlds leading provider of business software(*), offering applications and services that enable companies of all sizes and in more than 25 industries to become best-run businesses. With more than 86,000 customers in over 120 countries, the company is listed on several exchanges, including the Frankfurt stock exchange and NYSE, under the symbol SAP.