Today’s economy remains a challenging business environment for many in the retail sector. To stay ahead of the competition, retailers cannot afford to stand still, and must constantly innovate to ensure they reach their customers with the products they want.
However, with margins thinning, and consumers facing a cost-of-living crisis, maintaining profits can be difficult. Here technology can make a difference, with many retailers currently weighing up how best to leverage their data, embrace AI and if/when to move to SAP S/4HANA. Michael Gent, UKISUG Retail Focus Group Lead, and Costantino Petrosellini, UKISUG Board Member, share some of their thoughts about what is front of mind in retail.
The reinvigorated need for good data
As retailers have rebalanced their in-store and online businesses in the post-pandemic world, delivering omnichannel experiences has become a priority again. Whether it is offering more personalised services or managing inventory across in-store and online operations, it must be to be underpinned by good data.
For instance, there has been a renewed focus on loyalty and membership schemes, as retailers look to understand their customers better, so being able to process and analyse this data quickly is becoming increasingly important.
With retailers becoming ever more data dependent, modern ERP systems and analytics capabilities will be key to delivering omnichannel success.
Expanding the use cases for AI
Like in many other sectors there has been a lot of buzz regarding the use of AI in retail. Certainly, in the short term the most positive benefits will be felt at an operational rather than at a customer level, for example, using AI assistants to manage helpdesks, and the tasks resulting from these desks, and accelerate tasks that traditionally occupy significant amounts of time, such as invoicing or inventory management.
The extension of the capabilities of Joule – SAP’s AI copilot – also has interesting implications for the retail sector. In its new form, it will be able to provide intelligent insights and recommendations to help retailers become more agile, resilient and sustainable. This will help improve store operations, and allows for supply chain processes to be automated, which can drive significantly improved long-term planning processes.
Making the business case for new projects
With budgets remaining tight, most retailers only have capacity to focus on a limited number of IT projects each year. This means that IT teams still need to fully demonstrate the business case for moving to new platforms, such as S/4HANA.
New tools adopted by retailers must carry significant benefits – and enhance already-existing processes. Yet, in many cases, existing SAP systems do their job well and have been customised to meet a retailer’s specific needs and processes. This remains a challenge for many retailers, as these systems and processes can be a point of competitive differentiation, so moving to S/4HANA and a ‘clean core’ is more than just an IT decision. With the 2027 maintenance deadline approaching for ECC 6.0 this is front of mind for many retailers.
Retailers need technology partner support
Retailers are in a tight spot right now, due to a number of economic and industry-specific challenges. While they have a range of options to overcome these challenges, they also need to work with their technology partners – such as SAP – to understand exactly how new technology products will drive improvements to existing practices and deliver tangible results.
At UKISUG, we offer a platform for discussions and idea exchange on SAP for Retail and core modules, along with consumer packaged goods. As a 'vertical' Focus Group, our agendas span diverse topics proposed by members, covering not only SAP but also other retail solutions and challenges.
Check out our web page for more details https://www.sapusers.org/learn/communities/industry
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