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Ready for a Software Upgrade?

BY Ken Clark

At lumberyard X, employee A hands a piece of paper to employee B. Employee B keys the information into
a computer.

Later, employee B picks up the phone. He explains into the phone that employee C is not available, and, therefore, customer D will have to wait for the information to arrive with employee C.

And in an adjacent room, employee E looks over a dozen clipboards hanging neatly on nails in 3 rows of 4.
Sources in the technology who spoke with HBSDealer for this article agree unanimously — this yard is a prime candidate for a systems upgrade. And it’s not just lumberyards that can struggle with antiquated information systems. And it’s not
just antiquated systems that deserve upgrading.

Small cuts, big picture

George Maginnis of Paladin Data Corp. has seen a variety of technology tipping points push retailers toward investment in new systems. These range from waiting for days to receive help with a simple problem, to paying exorbitant costs for system upgrades, or seeing features on other systems that aren’t in their current pipeline.

Sometimes, a little problem can be the straw that breaks the IT systems back. Maginnis points to a prospective client who was called with a problem. “A barcode scanner he purchased through his supplier wouldn’t connect to his POS system, and he had been waiting days to get support,” Maginnis said. “Annoying, but hardly a reason to consider switching systems.

“However, further inquiry revealed this was one of a string of frustrating support experiences this retailer had put up with for years,” he said. “He’d found his own tipping point and had started looking for a better way forward.”

Details are important. But so is the overarching big picture of software investment. Here’s how Maginnis describes it: “Retailers who use their product knowledge and experience to create a pleasant and helpful atmosphere for their customers are more likely to thrive when competing with similar businesses and internet retailers,” he said.

To that end, point-of-sale systems that automate back office tasks free up employees to get in front of customers on the sales floor, boosting opportunities for add-on sales.

The benefits compound when the POS ties into the inventory management system.

“A point-of-sale system that uses a store’s sales history to reliably predict which products customers will be looking for in the weeks to come helps the retailers lower their overall investment in inventory by reducing or eliminating overstock,” he said. “With profits stored in the bank instead of the stockroom, the retailer has more cash on hand to spruce up the store, train employees or try out new products that customers are looking for.”

Typing and retyping

Understanding the big picture of a software investment requires retailers to step back and look at ways they
can improve.

According to Sarah Bell, business development manager for Ponderosa LBM Software, a division of Computer Associates Inc., focus should fall on areas where your operation can be streamlined, keeping in mind that operations must be willing to adjust their daily business processes to gain the most bang for their buck.

“Examine the areas in your business where your current system impedes your productivity,” she advises.

She offers a mini self-examination checklist:
• What redundant tasks are done over and over?
• Are you backing up to correct errors on a daily basis?
• How integrated are core business applications with each other?
• Are you guessing inventory usage, or accurately predicting?
• Can you track the cost of deliveries?
• Can you accurately schedule ETAs of deliveries with real-time GPS?
• Can your customers view their account online and reprint their own invoices, thus freeing up your back office staff?

It’s also important to think about how your business might change in the future, so that your systems can grow with your vision. Case in point: installation services. If so, it would be helpful to track contracts for jobs where materials are being shipped over several months.

These questions represent a good start to a company’s search for the right software. And here’s the end game, she said: “The right software makes your company more competitive and more profitable.”

Low-hanging fruit

Doug Smith, director of product marketing, retail and distribution at Epicor Software, agrees that when it comes to IT system investments, retailers face moving targets and changing landscapes.

“The challenge is to try to get the retailers to think out farther than they currently need to today,” Smith said.
There’s no substitute in that regard for technology vigilance across as many channels and industries
as possible.

“Absolutely keep your eyes open for trends,” he advised. “If you’re only going into the competition for ideas, you’re missing the boat. Panera Bread, Amazon, Starbucks — the consumer is certainly going into those places.”

In that regard, Smith sees two ideas catching on right now: contactless payment (think the Apple Pay, and others like it) and gift registries. Both represent simple ideas that improve the consumer’s in-store experience.
And not too far from any retail technology conversation is the Amazon effect.

“I think and many people think that consumers still like shopping in stores,” he said. “They just want you to make it easy and quick for them. I don’t think most people really want to buy from Amazon. But don’t put up the barrier so that they’re forced to go to Amazon.”

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