When the going gets tough ...we show up

By Bob Amster, The Retail Technology Group

I know, it sounds terribly self-serving. We are the cavalry riding over the ridge to help save the day. Well, maybe. There is a complaint in the advertising industry that when their sales are soft, the first thing that companies do is cut the advertising budget, and that cutting the advertising budget is the last thing they should do. I submit to you that similarly, when the retail business is bad – as it is right now – is when retailers look for ways to reduce operating costs and desperately to increase sales, yet they are loath to spend on consulting fees. Which brings me to where we come in.

In the space of less than one year, we conducted three separate and distinct process improvement engagements for three completely different types of retailers. The first is an off-price national retailer with fewer than 100 stores. The second is a specialty hard-goods, retailer with 400 stores, and the third is an early stage retailer of gift items and personalized stationery. In all three cases, and without spending a lot of time or a lot of their money, we identified so many opportunities to reduce unnecessary labor hours through streamlined processes and either reduce cost or increase selling hours that, by their own admission, our fees were paid multiple fold.

The responsibility of modern information systems and technology departments includes anticipating what can be done to reduce costs and increase sales through the application of their craft, bringing those ideas to management, and then executing the agreed upon measures. Curiously, not all systems and processes are improved through technology, but through merely re-defining the process so as to eliminate non-critical, or even vestigial functions (‘we’ve always done it this way, we just don’t know why’). Even more interesting, is that the ROI is seldom difficult to prove. In fact, the assumptions about the impact of the recommendations upon the business have been predominantly conservative assumptions. The actual results can be dramatically better.