Retailers operating in a fast-paced, competitive space that is prone to disruption may seek a robust ERP system to begin a digital transformation, striving to strengthen their ability to evolve with customer behavior and preferences. As a digital core for organizational growth, SAP S/4HANA Retail provides a single-platform solution for retailers that helps improve innovation across a value chain. For retailers, S/4HANA can support customer personalization efforts and increase scalability through modeling and decision-making tools.

In the past, problems stemming from outdated databases and systems, such as data silos and lack of process integrations, presented barriers to gathering valuable and actionable information. SAP S/4HANA for retail overcomes these problems by providing holistic data insights in real-time, helping retailers discover and strengthen the value of their digital channels.

SAP S/4HANA Retail for merchandise management is industry-specific and utilizes operational data from point-of-sales and other sources in a collaborative way to best support employees in stores, as well as those operating from a retailer’s headquarters. This centralized platform has a well-developed user experience that makes data easier to maintain and trust, and more useful, which provides benefits to the entire value chain, from customers to suppliers, to partners and other constituents devoted to contributing a relevant retailing experience..

Understanding the Consumer

SAP S/4HANA is an end-to-end solution designed to help retailers better manage merchandise and serve customers with personalized experiences. As customer demands change and force retailers’ operations to better meet their preferences, S/4HANA provides the tools to adapt quickly. It helps employee users take individual customers into account, with insights coming from various marketing sources such as email, social media platforms, and CRM data.

One example of a use case for this is Adidas’ “mi adidas”. This customer-focused initiative serves information to potential customers through social networks and allows them to customize shoes and create a personalized experience. The SAP Customer Activity Repository can also bring in eCommerce transactions and other point-of-sales data to support modeling scenarios to help make the best possible decisions based on the data.

SAP S/4HANA Retail Merchandise Management

As a digital core, SAP S/4HANA can benefit seasonal retailers that must manage a highly volatile product lifestyle by assisting with pricing and stock management, lowering the chance of markdowns and providing the product that customers want and expect. It can also help reduce costs coming from poor supply chain planning, waste, and data errors, as well as revenue losses from stock-outs and inaccuracies. For retailers, S/4HANA connects manufacturing, wholesale, retail, and eCommerce digitally to better support planning, product sourcing, supply chain management, and more. This ‘linking’ helps drive innovation and creates loyal customers, by providing access to merchandise accurately and timely.

Embedded analytics functions also support decision making and immediately provide operational insights at any time, with transparency from rapid connections. With SAP S/4HANA, logistics surrounding merchandise are better managed, leading to reductions in stock-outs, markdowns, and inventory costs with the synchronization provided. This creates low-risk decision making and gives retailers ability to quickly make changes to their inventory and value chain.

Retail businesses can best use an agile digital core in situations where they can create strategic synergies through digital core connections, improve employee efficiency with flexible user experience, allow use of mobile devices to check stock and make decisions or adjustments based on a universal journal table, and more. To be best prepared for a digital transformation, retailers should ensure that the organization’s leadership is prepared to drive change based on a planned digital strategy with collaborative solutions. And, in order to optimize value from a digital transformation, SAP S/4HANA should be utilized end-to-end for insights leading to innovation. Transforming with a flexible digital core system like SAP S/4HANA will help ensure retailers stay competitive and serve their customers preferences and needs most effectively, and Clarkston can help you get started.

Contributions by Courtney Loughran.