Retailers have come a long way on their merchandise transformation journeys. Integrating space plans with assortment is where retailer wants to drive towards in order to have a tailored offering for customer segments. Retailers are becoming more and more data focused to close the loop between planning and merchandise execution and accounting for what actually sold to plan for subsequent stages. Automation of the assortment planning process is supporting retailer’s market expansion strategies without making the process heavy and cumbersome. Recent reports state that 25% of top 30 US retailers use BI tools to support their Merchandise Planning functions. As the market pressure intensifies, in order to remain competitive and on the offensive, companies will need to re-evaluate their pricing strategies and processes.
At HCL, we help our clients to move towards customer centricity in Merchandising, price optimization and lower level of granularity in assortment analysis & planning through Data-driven Merchandise planning, Tightly-coupled processes to manage merchandising variables – Item, Assortment, Price, Promotion, Space – with integrated workflows, enterprise communication and approval workflows which typically reduce work effort/time, statistical analysis of actual against benchmark performance and so on.
Our retail solutions focuses on retailer’s assortment planning and analysis of customer preferences to existing assortments, enablement of customer centric merchandising catapulted by analytics and BI framework, enabling the retailer in establishing a single vision of truth through our master data management framework, lastly in helping the retailer in allotting best price to right merchandise across the trading calendar through our price optimization solution.
Assortment Planning and Analysis
Retailers find assortment planning and fulfillment of fast products a problem area. This offering helps retailers optimize their assortment planning process for merchandise. HCL solution provides a tool that plans and distributes related items based on the performance of the category, not an individual item. Based on the analysis, detailed planning and execution of assortment takes place across the following stages:
- Category Composition - Decide on Space allocation and Sales projection
- Sub Category planning - at sales projection, Inventory requirement for initial fill
- Develop Sourcing Strategy Matrix
- Develop Pricing Strategy Matrix
- Develop Plannogram
- Place products at stores
The result is a meaningful presentation of that category in the stores. The solution links the store planning and assortment planning applications in retailers.
Achieving the right target Merchandise can be made possible only by adapting a customer centric approach to retail planning and execution. Customer data such as demographics, multichannel - multi format purchases are analyzed together with enterprise data from multiple systems such as merchandise financial planning systems, supply chain management, production planning and inventory management systems. HCL BI and analytics framework towards target merchandising links Strategic and financial planning, Space planning, Assortment analysis, Multichannel Management, strategies for In-store experience, Price, promotions & marketing and overall supply chain execution.
Master Data Framework
Product data within retail enterprise is found to exist in multiple formats across systems, spreadsheet and applications. Unless an enterprise wide unification of data is planned, product data cannot be ensured to evolve uniquely. Moreover, such unification is also expected to ensure correctness of business decisions with reduced risk, both financial & operational with improved customer satisfaction.HCL master data framework enables our clients to
- Manage internal content in an enterprise wide repository, improve associated processes in managing this content and overall, such a repository maximizes the return on content and minimizes the cost of maintaining different formats of maintaining content.
- Design user interfaces to search, locate and manage multichannel electronic product catalogue
- Enable communication of critical information in a heterogeneous application environment supported by tight integration.
- Enable customer / business user centric analytics and reporting to leverage harmonized data. As a business benefit, a single version of truth on data helps to understand customer purchase decisions
Pricing goods for maximum revenue is a greater challenge & source of increasing concern for retailers. With thousands of merchandise at store, it is quite not feasible for retailers’ to actively price all varieties of products post a clear cut analysis of competitive pricing, seasonal / monthly markup rules and collaborate with manufacturer if required. It can be articulated that without a deeper understanding of process towards inflow and sales of merchandise from supplier to stores, automation of pricing scenarios to obtain the optimum product price, a category manager or a merchandiser is increasing the possibility of markdowns on a daily basis.
HCL solution towards price optimization enables:
- Drives value by anticipating customer buying behavior and helps to predict the overall loss and impact on sales / margin of goods sold
- With tight yet real time integration framework customer centric pricing can be communicated well in time to store managers for timely assortment planning and visual merchandising changes at store.
Overall, the HCL price optimization solution delivers increased revenue by calculative avoiding much impact on merchandise margins. Subsequently, optimum pricing at store drives increased customer loyalty, faster movement of fresh and new stock at store reducing stock outs.