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Open Source
Retail Business Intelligence and Data Warehousing
Business Need
Long prominent in high street retail, Newton and Appleby had adopted to the 2001 recession by diversifying into low-margin, high-volume discount retail. As the telltale signs of another recession made themselves felt in Spring, 2007, N & A asked HyTech Professionals to consult on getting more decision-modeling power than a 9-year-old data warehousing and business intelligence system with rather inflexible ad hoc reporting could deliver.
Specifically, the mass market division needed to give store and category managers, the logistics department, and head office executives more meaningful data structures and dashboard views to make better decisions and boost attainment of division KPI’s. From day-to-day, crucial areas for decision-making included:
- Site selection;
- Gaining better visibility into shopper purchase habits and preferences;
- Product mix and management of shelf facing;
- Inventory management;
- Pricing strategy, including seasonal peaks, clearance sales and promotion;
- Operating revenues; and,
- Management of third-party vendors and concessionaires.
Solution
The Hytech Retail Business Intelligence solution covered all the important bases with:
- Tools such as JDBC 2006, database query with SQL 2005, SQLJ 2003, and Ruby on Rails.
- An RFID-reader network both in-store and the warehouses for more accurate inventory data and reducing logistics costs;
- ERP system data interchange between N & A and suppliers for enhanced supply chain optimization;
- A more comprehensive database that accounted for SKU performance by month and season, as well as an improved business intelligence application that drilled down to territories and individual stores.
- A complete consumer analytics suite including visibility into effects of three different loyalty programs, transaction/basket analysis, in-store itinerary captured by RFID readers, socio-demographic profiles, income levels, regional preferences and more acutely sensitive seasonality analysis.
- Full-fledged sales statistics and data mining tools for better forecasting and analysis of purchase patterns from suppliers.
Our Role
HyTech Professionals ably engaged with Newton and Appleby as extended software development partner. Our team of software architects and systems engineers built and tested the complete retail data warehousing, business intelligence and decision modeling solution.
Solution Benefits
Within nine months after deploying the open-source system, N & A realized concrete gains that enhanced chain competitiveness:
- Sharply reduced TCO owing to the equivalent (or better, in some respects) functionality delivered by open-source platforms and applications.
- More accurate modeling of new-store performance.
- 156 junior and middle managers gained desktop access to 285 different performance indicators that they could “drill down” through to the sub-unit level.
- Closer correspondence between store revenue and ad and promo spend.
- A 35% reduction in lost revenue and clearance sales since shipments to each store were better optimized as to the mix of styles, colors and sizes.
- A 21% rise in inventory turns across 15,000 SKU’s in the mass market division.
- Within just three months, ROI on the extremely affordable open-source solution had topped 175% and looked headed for an annualized return of 700%.
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