Technology that is paving the way for faster communication along the data highway linking suppliers, stores and shoppers is a top priority for retailers this year.
Driven by a need to cut costs and provide better customer service, the most popular enhancements will be the integration of personal computer-based point-of-sale systems with more sophisticated, in-store processing functions, according to retailers interviewed by SN.
Debit-card processing, computer-assisted ordering, continuous replenishment, electronic funds transfer, automated labor scheduling and centralized pricing are paramount as retailers look to technology to make them more competitive.
"The main reasons we are looking at these applications are to reduce costs, develop a much better working relationship with our suppliers and, of course, to improve our service to the customer," said Ron Waldbillig, assistant vice president of management information systems at Hy-Vee Food Stores, Chariton, Iowa.
To support the new applications, many chains also will be upgrading the memory and processing capacities of their computers. This will provide the foundation for faster modem transfer and higher-quality dedicated telephone lines to speed data transfer.
Here's what some retailers are planning:
Tom Nowak VP, MIS
Price Chopper Supermarkets Schenectady, N.Y.
We are going to start our rollout of a new, PC-based, point-of-sale system. We're also in the final stages of hooking up all of our scales to an in-store processor. We're also going to attack coupon scanning, and start beta-testing a computer-assisted ordering project in a few of our stores sometime later this year.
Jim Yarborough director, data processing
Community Cash Stores Spartanburg, S.C.
Insofar as computer equipment in our home office, we'll be staying the same this year, with our IBM AS 400. But in the stores, we are looking at replacing our NCR-based point-of-sale system with a Unix-based system in April. The leases (for the NCR system) have expired, but that's not the main reason we're changing. It's because that technology is kind of obsolete. The Unix system will give us the ability to do perpetual inventory, construct a full customer data base, and do employee time-capture functions on it for payroll.
We also like it (Unix) because it's an open system. It will allow us to take our software and hook any equipment into it -- such as interfacing with the software in our stores.
Tony Rinella director, MIS
Bashas' Markets Chandler, Ariz.
A primary new technical focus is on support systems for a debit-credit card. We're looking at an in-store processing system connectable to the point-of-sale terminal. We only have limited capacity to do that now; debit-credit is just a stand-beside system rather than a truly POS-integrated system in 23 of our stores.
By the end of the year, we also hope to install an automated check-authorization system. We may also want to install more memory and more speed on our IBM AS-400 at our corporate office.
Ron Waldbillig assistant VP, MIS
Hy-Vee Food Stores Chariton, Iowa
We are looking at enhancements to several major applications, including more electronic data interchange and continuous replenishment. Enhancements in continuous replenishment technology will help us reduce our distribution-system costs. We'll also be doing more distributed processing. That means moving more people and more applications to local area networks.
Our store computer systems will be upgraded to handle additional accounting functions. There will also be a major emphasis on paperwork reduction, which will encourage us to undertake more scanning of paper documents to optical disk or hard-disk computer storage modes.
At the store level, we'll be doing more in-store printing of shelf labels and shelf talkers. We feel that by doing this at the store, rather than at the headquarters level, it won't only give us the labels immediately, but will produce a real cost savings.
Brad Wahl director, computer operations
Leevers Supermarkets Devils Lake, N.D.
W e are updating and consolidating our equipment. This means more integrated, tied-together applications and greater ease of use. Efficient Consumer Response movement is also going to be very important, because we want to upgrade our integration with our wholesaler. We're dabbling with more computer tie-ins with our wholesaler so we can stay in touch with them for daily inventory updates.
Chris Kantak director, information services
Olson's Food Stores Mountlake Terrace, Wash.
A big emphasis has been our migration at corporate from the IBM System 36 to the Unix 5, Release 4 software running on the NCR 3447 for most of our applications. We're still running our (central) accounts payable and accounts receivable functions on the 36, but retail point-of-sale is now running on Unix. We currently run a lease-line network to each store.
We've also acquired some communications software that basically allows us to take the POS pricing control programs that were run on the 36 and run them under Unix. The software also provides for nicer communications, which is important because we're starting to turn over much of our POS pricing to our wholesaler on an outsourcing basis. Since we are going to a central bakery system, we'll also be going to a Datapack system that will allow all the ordering and inventory to be done at corporate rather than the individual stores.
Russ Kates controller
Steeles Markets Fort Collins, Colo.
We are strongly considering micro-enhancements to our point-of-sale systems. We're evaluating a system that will tie all four of our stores together and handle data from our frequent shopper program as well. Linking all our stores together will help the coordination of our pricing. More timely pricing changes could be accomplished, because one person would be doing it (inputting the price changes) at once rather than four people at once.
There would also be more pricing accuracy, because each store would get the same batches of pricing-information sets. At the store level, it will also free up people who were handling price changes to do other things.
Mike Walter director, data processing
Foodland Supermarket Honolulu
At the store level, we'll be continuing to upgrade our point-of-sale to a PC-based system. We also intend to integrate electronic funds transfer functions. The benefits should accrue in consolidated reconciliation and fewer keystrokes. Also, for electronic funds transfer, we're looking at leased-time instead of dial-up modems. This will have performance advantages.
Finally, we are evaluating a time-and-attendance package for installation sometime later this year. Right now, we handle those applications through manual time clocks and punch cards. The right time-and-attendance package will help us to cut down on manhours now spent on those functions.
Joe Holtgrewe director, management information systems
Dierbergs Markets Chesterfield, Mo.
We're looking at replacing our overall network and our in-store processors. We want to tie our stores in with a local-area-network type environment rather than dial-up. Going along with this will be changing our in-store processors to more state-of-the-art, client-server architecture.
We're also evaluating a point-of-sale system that will functionally serve the same purpose of collecting and gathering data that our present system does, but something that is much more state of the art with much faster modem speeds.
Robert Rough chief financial officer
Harvest Foods Little Rock, Ark.
This year we want to convert from time cards to time and attendance software. We haven't yet decided on a vendor but we are attracted to the technology because it will give us cost savings and greater accuracy.
We're looking at communications issues between our stores and our host computer. Because we've been putting more phone lines in our stores, we're to the point where leased lines or satellites become an appropriate trade-off over dial-up modems.
To reduce some of our future maintenance costs, we're also going to be doing some cleaning up of our mainstream software programs here at the office.