The progress engine – a trend on automation in retail

Specialized retail: in what an essence?

To deal with the reasons which cause working conditions in specialized retail we will formulate determination of this segment. The companies of specialized retail, as a rule, have the range of goods limited to one or several commodity groups falling within the scope of specialization of this company, which is often expanded by the relevant complementary goods and services.

Can be examples:

• shops of sports goods: Adidas, Rebook, Nike;
• jewelry stores: 585, SUNLIGHT, Almaz-holding;
• boutiques of fashionable clothes: H&M, Mango, ZARA, Lamoda;
• shops of hours: Swatch, NICKNAME;
• shops of cosmetics and perfumery: Yves Rocher, IL DE BOTE, L’Occitane en Provence and others;
• bonus and luxury brands: Longchamp, Gant, Furla.

Having understood features of formation of an assortment matrix and having got acquainted with profiles of specific representatives of specialized retail, it is possible to draw some conclusions on the most essential distinctive features of business which characterize this segment:

• Direct dependence of indicators of activity of the company on commitment of the buyer to a brand.
• Essential motivator of shopping in a segment of specialized retail is rather not the actual demand in goods, and desire of the buyer to derive pleasure from the process of its acquisition.
• The small amount of commodity categories along with need of satisfaction of individual demand requires differentiation of the range not on categories, and on their characteristics (attributes).
• The minimum size of warehouse stocks in outlets (the majority of positions gives all the best on shelves completely).
• The value of the purchases purchased in shops of specialized retail (owing to price policy, policy of quality and positioning of brands in this segment), in the opinion of the buyer is higher, than purchases of goods of the same groups in other segments.

Now all segments of retail are anyway affected by the crisis phenomena in economy and in these conditions of the company of specialized retail should look for ways of increase in efficiency of the activity taking into account all above-mentioned features.

Retail vs crisis

Along with preserving of the existing loyal buyers in crisis times there is an opportunity to increase the number of buyers committed to a brand of the company, solved or forced to replace a brand owing to economic or other reasons. For this purpose it is necessary:

• Understand and consider requirements and habits of each client personally.
• Provide to the buyer freedom in the independent choice of parameters of goods.
• Motivate personnel on satisfaction of needs of each client and control the actual indicators of activity.
• Have an opportunity to perform deliveries under the specific buyer.
• Develop and carry out personified the loyalty program, it is frequent with difficult rules of charge of bonuses.
• Criticality of existence of a large number of the available channels providing the most exact information for familiarity with the goods which are available in assortment and their availability to the order.
• Meet the increased expectations regarding after-sale services (repair, consultation, maintenance, etc.)

For a variety of reasons, in crisis conditions many retailers sacrifice to economy the service level in the shops that negatively affects feelings of buyers from the process of purchase. On the general background of decline in quality of service in networks of competitors, its increase can help not save existing, but also attract new buyers for whom the pleasure from purchases is an essential factor of the choice of a brand. For this purpose it is necessary: first, to implement more flexible and simple terms of return and replacements of goods, secondly, more carefully to approach a question of the organization of the scheme of gift certificates, the programs "I Want as a Gift" and, thirdly, constantly to provide and control presence at personnel of knowledge of features of the sold goods. Besides, integrating all sales channels in the omnichannel integrated model, it is possible to facilitate as much as possible interaction of the buyer with the company.

As practice shows, at decrease in the consumer capability which is the main effect of crisis, people are ready to pay only for those goods which precisely satisfy to their requirements, and are not inclined to make a compromise in the matter. Precisely to adapt the range for the become tougher selection terms, the companies need to analyze needs of buyers in the smallest details, studying parameters of profiles of the buyer, a position of an assortment matrix, carrying out data analysis on sales at lower levels and with a bigger accuracy.

Effective process automation of specialized retail

For preserving of profitability at the pre-crisis level of the company are forced to look for ways of the maximum optimization of their operating activities (purchases, logistics, merchandising and others). Can be examples of actions:

• increase in speed of relocation of goods between outlets.
• improvement of quality of accounting of existence of goods and demand forecasting on it.
• expansion of planning horizon of deliveries along with decrease in the minimum level of stocks in warehouses and outlets.
• performance improvement of a sales and office personnel.

The specified actions are quite obvious, but their implementation in practice is connected with need of collecting, processing and analysis of huge data arrays about purchases, a remaining balance, preferences of buyers, the movement of goods, efficiency of personnel. It almost excludes accomplishment of these actions by the staff of the companies in the manual mode and requires implementation in the companies of specialized retail of the information systems capable to consider all specifics of activity. But there are difficulties. Often before the problems caused by economic downturn, many companies in principle do not think of the correct organization of operating activities and its effective automation.

Meanwhile, it can be implemented in reasonable time and with proper quality. What requires a right choice of the information management system by activity of the trading company which at least should meet two criteria:

• The information system should be initially developed taking into account the specifics and tasks facing specialized retail to minimize the implementation cost and ownerships.
• The developer company should have extensive work experience in the field of process automation of specialized retail to provide not only implementation of the most information system, but also to help customer company to optimize its organizational processes according to the best practices which are available in the industry.

In 2016 with partner support of ICL Services the Russian market is entered by the new company which corresponds to both specified conditions - it is the French company Cegid making the software of Yourcegid Retail Y2 for management of activity of the companies in a segment of specialized retail with broad examination in the field.

From a large number of competitors a system is selected with such indicators as:

• The modular service-oriented architecture which allows the companies of any scale to automate their processes at the minimum costs for implementation.
• An opportunity to configure all processes of activity so that in the best way to consider specifics of the company.
• The major difference is the module of management of omnichannel sales which allows to remove all organizational and technical borders between the available sales channels and with ease to add new without costs of time and means and also to manage them. Different scenarios of management of omnichannel sales are supported, such as "buy online – take away in shop", "buy on mobile - return in shop", "buy online with home delivery" and many others.
• Existence of the module of a kliyenteling helps a sales personnel to identify quickly the buyer and always to be aware of his preferences and also to fix all changes in them. The opportunity for work on mobile devices allows employees to be always near the client and to advise him on all arising questions: discounts, existence available to it of the selected goods in shop or an opportunity to order and give goods with the necessary parameters from other outlets, to offer complementary goods or services.
• The powerful analytical module is capable to provide information on indicators of activity of the company practically in a real mode of time with any necessary detailing.
• The module of personnel management includes all tools necessary for development and control of daily activities of a sales personnel that it is capable to increase efficiency many times. These activities can be tied to processes in which this or that employee participates that will allow the company to control correct accomplishment.
• The module of inventory management is executed in such a way that it can be configured practically under any rules of replenishment action, relocation and inventory.

The specified functionality of the Yourcegid Retail Y2 system allows the companies from specialized retail as much as possible to consider their requirements and to effectively automate their activity, having simplified implementation of crisis response measures which were given earlier.

Partner material

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