SAP for Retail

SAP for Retail: instrument of corporate management by trade

The solution of a problem of creation of a corporate management system begins with strategic planning, design of structure of business divisions of the company and performance indicators of their work and comes to an end with control of results of activity of branches and departments of the calendar periods. The complexity and importance of the solution of such task, speed with which the active business environment requires reaction to changes, defines need of concentration of resources and the choice of the tools adequate to task scales. The most developed tool allowing to organize fully control of processes at all levels of management in retail chain stores, having saved at the same time flexibility of the organization and capability of reaction to changes of the external environment, the SAP solution for SAP for Retail is.

Possibilities of the solution cover all cycle of creation of added value and support all processes providing business performance. The map of the solution is submitted in figure 1:

Fig. 1. Card of the SAP solution for Retail

Business planning and analytics

Determination of strategy of the company and business planning – the initial stage of formation of an effective management system. The SAP solution allows not only to formulate the long and medium-term purposes and tasks of business, but also to use structure of key performance indicators (Key Performance Indicators, KPI) for control of compliance of development of the company of the developed strategy. Integration of instruments of strategic planning with financial solution components of SAP allows to use data of reporting periods for processing and extrapolation, to consolidate data for planning "from below-up" and to distribute target indicators on divisions "from top to down".

In addition to support of control functions by key indicators and a financial analysis, the SAP solution gives special opportunities for the trading companies, such as planning of a goods turnover and range (Merchandise & Assortment Planning, MAP). Analyzing data of consumer preferences depending on geography of location of shop and its format, seasonal fluctuations of sales volumes, the solution allows to plan its range, to predict sales on types of goods and to manage categories on the basis of these forecasts and planning. Operating with thousands of names of goods, the solution allows to optimize the range and inventory quantities in shops and distribution centers, effectively using resources and increasing profitability of outlets.

The e-business intelligence included in structure of the SAP solution for retailers provides mechanisms of the comprehensive analysis and preparation of reports which allow to perform without problems data integration from different sources and helps the organizations to understand better interdependence of tactical actions and strategic objectives.

Purchases and logistics of supply

The SAP solution for retail integrates the mechanisms allowing to plan, to model and keep operational accounting of all purchase transactions and logistics:

• the choice of suppliers on the basis of mechanisms of tender purchases and the return Internet auctions allows to reduce the purchasing budget due to the maximum market coverage by search of the supplier, instruments of decrease in purchase prices and transparent procedures of the analysis of offers;
• end-to-end planning of logistic flows – from sales to requirements – allows
• optimize volumes of safety stocks on all storage locations in logistic network, having reduced costs for equipping and support of warehousing capacit and transportation costs;
• planning of deliveries, joint with suppliers, and transportation does plans exact and operational – volumes of safety stocks and risks on supply failure are as a result reduced;
• accounting of obligations of suppliers under all signed agreements in unified information environment provides the high level of control of accomplishment of obligations;
• operational accounting of the movement of goods on all logistic network allows to manage stocks on the basis of information arriving from warehouse terminals and distribution centers online;
• use of strategy of "pulling" (PULL) or "pushing" (PUSH) of distribution of goods provides accomplishment of strategy of the company in the field of logistics and circuit management of sale, allows to increase sales and to reduce volumes of an unrealized remaining balance;
• the centralized control of accounts payable and supplier payments reduces risks of emergence of penalties, increases the level of satisfaction of suppliers and allows to manage financial flows effectively.

Purchases and supply – one of areas where centralization of processes and the organization of corporate services can help with the solution of a problem of increase in business performance. The SAP solution – the best tool for the organization of business processes of the centralized service of supply.

Sales management in outlets

Sales management in outlets – a cornerstone of successful business of the retail company. Use of the SAP solution with outlets allows to use the best instruments of information exchange checked by long-term practice to creation of model of interaction of the corporate center. The most important of these tools is the contra-directional interface of integration between a corporate information system and electronic point-of-sale terminals (POS terminals).

Such interface used online or in a standalone mode depending on technology infrastructure provides unity of the normative reference information on all departments of network. Data on goods, partners, shops of own network and competitors are consistent across all territories of retail chain stores as they are kept only in the corporate center and create base for the centralized analysis and planning.

Depending on a format of outlet and its location in the corporate center the assortment matrixes considering specifics of work of shop can be made. High accuracy of planning and operating control of the range of outlets create a basis for an optimal goods turnover of the retail company, allow to reduce volumes of unclaimed stocks, to avoid deficit and to reduce possible losses of trade revenue. Maintaining assortment matrixes on categories of outlets considerably simplifies the procedure of opening of new shops, allowing to use similar practicians and the experience acquired by other outlets.

Similarly, in the corporate center rules of the multi-stage pricing considering when planning the prices the volume of a planned margin, transportation and warehouse costs, the prices of competitors and other factors influencing calculation of margins are kept. The centralized control of trade margins – one of the main instruments of implementation of corporate strategy of retail chain stores, and use of the SAP solution for management of rules of pricing – the major step to creation of effective business.

Information on logistics of movement of goods (data on orders of shop, shipment of goods from distribution centers and arrival on a warehouse of shop, results of inventory) and sales, coming from shops to head office, is base for central planning and management of activity of network. Analyzing efficiency of sales on assortment groups, sales points, regions, activities, management makes more operational and weighed management decisions concerning resource allocation, an assortment number, the system of motivation of employees in sales points.

Marketing and management of a customer loyalty

The fight for the buyer which is developed between networks requires carrying out new marketing efforts, updating of the stimulating programs and advertizing campaigns.

In integrated solution of SAP for retail the marketing cycle includes:

• the analysis of social and demographic indicators (if necessary – with connection of the external database);
• segmentation and formation of a portrait of the consumer (on the basis of sociological yielded or the analysis of results of programs of loyalty);
• monitoring of changes in consumer preferences;
• planning and holding the advertizing activities directed to increase in a customer loyalty (planning of the budget of an action and the sizes of discounts/bonuses, task allocation and control of accomplishment of an action);
• efficiency analysis of actions – control of accomplishment of the budget in comparison the plan/fact, the analysis of changes of consumer preferences and assessment of economic effect of an action.

The major, in terms of providing tasks of marketing, a possibility of the SAP solution is data integration, connected with a consumer behavior and its commitment to these or those brands. This integration covers components of sales, databases of clients, financial data. On the basis of information on all functional areas from solution components of SAP, other systems and external databases marketing specialists have an opportunity to build the reporting using business intelligence tools that allows to control consumer behavior on all cycle of customer interaction.

Exact understanding of preferences and financial opportunities of the consumer, capability to predict their changes and to create consumer tastes – the purposes which can be successfully reached using the business scenarios of work of marketing services of retail chain stores implemented in the SAP solution.

Personnel management

The personnel – a strategic resource of the modern enterprise, and the SAP solution for retail cover all stages of "lifecycle" of the employee: from attraction before personal development and deduction of the best personnel in the company. The solution includes planning features and analysts, operational management of personnel, formation and development of personnel potential, management of cooperation and communications:

• maintaining organizational staff list, planning of vacancies;
• work market research, assessment and search of candidates;
• personnel records and the reporting according to the legislation;
• management of compensation packets and payroll;
• management of personnel development, planning of training and knowledge transfer;
• management of corporate training and exchange of information between employees;
• operational management of human resources of shop: task allocation, time recording, accounting of daily results of work, etc.

Effective management of personnel will allow the company not only to reduce the costs connected with personnel at the expense of assessment of qualification of employees, optimization of regular structure and the effective system of motivation but also to get competitive advantages at the maximum use of potential of staff of the company.

At the level of outlet the question of qualification of personnel and routine of the personnel is sharp, at the same time the financial result in many respects depends on quality of work of sellers and cashiers. The SAP solution allows to increase employee performance at the expense of motivation tools based on activity in a specific workplace, system control of accomplishment by workers of staff instructions, opportunities of rapid response of management to changes in results of work of specific sellers and cashiers.

The solution mySAP ERP HCM used in SAP for Retail belongs to the class 'A' on functional completeness.

Management of finance and accounting

Complex end-to-end control is the only way to achieve exact and accurate management of finance. In the SAP solution such approach is implemented, and it is intended for management of finance – both at the corporate level, and at the level of separate branch.

The solution allows to automate completely processes of accounting and management accounting and to optimize management of financial flows in the company working in the field of retail.

All solution components of SAP for retail are completely integrated with each other thanks to what the single information flow of data covering components in which economic transactions are registered (logistics, personnel management, the real estate) and accounting components in which financial flows are automatically carried out forms. Unified information environment provides the accuracy, completeness and consistency of credentials. The SAP solution for retail provides implementation of the following basic functions of accounting:

• accounting according to requirements of the legislation of the Russian Federation or the CIS countries;
• conducting accounting and tax accounting according to requirements of the legislation
• in parallel, in the mode of single data entry;
• accounting of business activities by several separate charts of accounts;
• maintaining synthetic and analytical accounting on all sections of accounting;
• conducting multiple currency accounting (with a possibility of maintaining three parallel currencies);
• possibility of parallel accounting or transformation of the reporting in other accounting standards (IAS, GAAP, etc.);
• cash management in a foreshortening of the day report and forecast of liquidity.

Except accomplishment of problems of reporting for external users, the special methodology of controlling implemented in the SAP solution provides all necessary complex of management accounting and costs planning and arrived in cuts:

• places of emergence of costs and profit;
• types of activity and processes;
• internal expensive orders and investment projects;
• products and services.

The specifics of management accounting of the network company are also that the main accounting item of results is the outlet, at the same time the analysis of results of its activity is kept at several levels – management of the shop (comparison of results on the calendar periods and the analysis of accomplishment of plans), controllers of activity of trade operators (the analysis of territories, formats of shops, works of separate points, etc.). The basis for the analysis is the operational information about activity of shop prepared in the form of the managerial profit and loss statement. For simplification of implementation of such analysis the SAP solution for operators of retail contains the Retail Ledger tool which is a set of managerial accounts, reports and means of the analysis of results of activity for managers of different level.

The flexibility of tools of the solution for the purposes of conducting management accounting allows the company to organize the end-to-end accounting system according to specifics of mechanisms of decision making, accounting policy and methodology of budgeting and control of budget implementation.