There is a lot of talk about the patchwork economy at the moment. Many retailers in particular have reported poor sales, and some have even run into financial difficulties. When major retail groups like Colorado and REDgroup (owner of Angus & Robertson, Borders, Whitcoulls) collapse, alarm bells should start ringing.
Which makes the Zara phenomenon in Sydney even more remarkable. Zara is a European fashion retailer which has opened their first Australian store in the Sydney CBD. In the month since opening, crowds of shoppers have been willingly queuing for long periods just to get into the store, and emptying shelves at a dizzying pace.
Internationally, Zara has built their success on vertical integration, with tight management of retail inventory, supply chain, product design and manufacture. A major goal being to optimise inventory holdings, and reduce the lead time needed to bring new products to retail shelves.
Vertical integration is never going to be a viable strategy for most retailers. But technologies such as Oracle Retail Merchandise Planning and Optimisation can lift efficiencies to similar levels. The demand planning tools make it possible to automate restock orders across complex multi-supplier situations.
Getting pricing and inventory levels correct needs to be a continuous effort. Oracle’s sophisticated store merchandising tools can help plan and analyse product line profitability across branches, product categories, or product lines. You can even drill all the way down to how individual store shelves are performing.
The dark art of discounting can also be planned based on measured facts, with markdown and regular prices optimised based on actual inventory performance and supply chain considerations.
When products are sold, collecting and reconciling revenue by store can also be challenging, especially when you are dealing with multiple payment methods such as cash, credit, vouchers, gift cards and refunds. We use the Cash Management module in Oracle Financials, part of Oracle’s E-Business Suite, to help ensure accurate and timely reconciliation, so you always have an accurate view of your financials, allowing problems to be identified and solved quickly.