Atanu Ghose IT Head, Dynamic Vertical Solutions (DVS)

The Indian retail sector is the second-largest employer in India. Hence, there is an enormous scope for the sector to get their operations streamlined. Technology has a very important role to play to ensure that there are timely replenishments, no stock-outs; products are “purchase-able”, material movement is accurately 

monitored and shrinkage is reduced. Supply chain should be efficient, robust and shelf-centric. Today, with the advent of international brands, government regulations and acceptance of different retailing formats, the retail sector proudly contributes to over 10% of the country’s GDP. IT has transformed the dynamics of the Indian economy, by creating businesses and also revolutionizing the employment of trained manpower. Retail exemplifies the same. 

How technology in retail is moving forward?
A recent study has found that retail companies in India are expected to spend US$1.07 billion on IT by 2010. While this seems to be a large number, consider this – the loss due to shrinkages in the U.S. alone is a staggering US$30 billion. Are the Indian companies doing enough? Are they at the cutting edge of technology? Not really. While all retailers agree that shrinkage is a major problem, not many in India have done anything about it.

The three most critical issues a retailer faces are: 
* Shrinkages – Losses due to pilferage, transportation, breakages, out-of-date products, etc. 
* Inventories – Over-stocking and out-of-stock. While the first leads to losses through unsold goods, shelf space blockage, tied-up capital, etc., the other leads to loss of customers and therefore revenues. 
* Availability of the right data at the right time. Lack of appropriate data means the top management is unable to accurately view and analyze their operational performance, but more importantly the ability to take corrective measures when something goes wrong.

With the proper IT infrastructure, all the above problems can be surmounted leading to significant savings in the cost of operations and therefore improved margins and profitability. Retailers can expect extensive inventory and labour cost savings from the adoption of radio frequency identification (RFID) technology, but some consumer product manufacturers will face higher costs and delayed benefits from adopting the technology. That is the conclusion of a new report on RFID and the Electronic Product Code (EPC) from global management consulting firm A.T. Kearney.

One of the most critical and also the most overlooked tool in the retail scenario in India is Business Analytics (BA). A properly set-up BA system provides a wealth of information, some of which may often not come to the notice of key decision-makers. Performance of retail outlets can be an indicator of location, product mix, staff efficiency and other key indicators.

How does one get the data at the right time? Through Information Technology tools. It has to be understood that Business Analytics can be beneficial only if the IT infrastructure provides accurate and timely data. Running BA on inaccurate data will lead to inaccurate analysis. BA helps in gaining visibility to constantly changing customer demand patterns, managing shortening product life cycles, combining historical trends and patterns with forward-looking indicators, coordinating with supply chain planning and management and reducing planning cycle times. BA solutions also provide the flexibility to tailor reports, dig deeper into particular dimensions, or view analyses in different ways. Some of the key performance indicators that a BA system provides is Customer Walk-ins, Conversion Rates, Average Transaction Value, Same Store Sales Growth, Average Daily Sales/sq. ft., Gross Margin/sq. ft., Net Sales per employee, Brand and Customer measures, Market Share, Gross Margin (Intake), GMROI, Inventory Cover (weeks cover), Inventory Turnover, Active to Total inventory, etc.

What role does DVS play in transforming the way business functions for its clients? 
DVS provides end-to-end integrated and adaptable business management applications providing comprehensive solutions for organizations of all sizes and all industry sectors. By cultivating innovative technologies on a reliable foundation of international best practices and business experience, DVS provides specialized & industry-specific high quality and cost-effective services / solutions, to cater to the vast and diverse needs of companies that want to grow, improve upon their decision-making capabilities and business success.

We are exclusive distribution partner of LS Retail suite of solutions for the Indian market. We play a pivotal role in localization of LS Retail integrated solution to meet the local Indian statutory and compliance issues relating to the retail and hospitality industries.

LS Retail is an integrated retail management suite that provides a single end-to-end solution for all the functionality that a retailer needs – from the customer touch-point at the Point-of-Sale (POS) to the stores operation, warehousing, supply chain and backoffice functions such as merchandising, CRM, vendor management, finance, purchase, promotions, etc. Since it is based on a single technology platform – Microsoft Dynamics NAV, no integration is required between disparate systems as is common in the retail industry, leading to shorter implementation times and fewer problems. Also, LS Retail is highly configurable and can be used in almost all the retail micro-verticals such as Apparel, Grocery, Supermarkets, Hypermarkets, Jewellery, Food & Beverages, White Goods, Healthcare, etc.

We have also developed a Credit Risk Modelling and Loan Origination System called Decision Station that helps retailers who sell high-value items like furniture, jewellery, automobiles to assess the suitability of a client to avail retail loans.

What is your business and marketing strategy for 2008? DVS has forayed in the retail and hospitality segments and seen success in the same. For us what is important from the current standpoint is to increase depth within verticals. While we aim to add more verticals such as healthcare and real estate, we want to gain leadership in retail and hospitality.

What are your expectations from the market? 
The retail industry is one of the most dynamic and high-growth sectors in the country today. According to analysts, the industry is set to outpace the GDP growth rate in India. The growth of the organized retail sector is estimated to be 20–25 per cent driven by changing lifestyles, income growth and consumer credit.

We are targeting both retail and hospitality markets for our suite of solutions. In the retail segment, we intend to focus heavily on Food & Groceries, Jewellery, Fashion & Apparel, Pharmacies, Multiplexes and Hotels. So, we are optimistic about the growth in India and the figures of the retail market provide the scope for growth.

With global players all set to come in, the existing retail companies in India need to update themselves with the latest technology in order to have a competitive edge over the non-recognized retail sector. Today, technology is imperative to increase customer satisfaction and make shopping a global experience. Adoption of international technology and localizing it to Indian requirements will be instrumental in accelerating the growth of this industry. We have also initiated dialogues with a couple of business schools (that have retail in their course module) to impart knowledge that would enrich students to come out as quality professionals.