A multi-million-pound project by WH Smith News to roll out SAP to its newspaper and magazine distribution depots has provoked a volley of complaints and threats of legal action from independent newsagents.
The project, which is £8m over its original £15m budget, is central to ambitious plans by the wholesaler to expand its business by selling newspapers and other products to newsagents through Internet links into each shop.
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But the implementation has been tarnished by claims from newsagents that they have to spend an inordinate amount of time clearing up delivery problems in the areas covered by the new SAP system.
The National Federation of Retail Newsagents (NFRN) said the problems were so acute in some regions that newsagents were considering suing WH Smith for compensation for lost business.
"It has got to the stage now where litigation will take place and that is not beneficial to anybody. We as retailers can't go on subsidising WH Smith," said David Kirwin, a member of the NFRN's executive committee.
WH Smith News, which is expected to unveil plans to build a new business that will link to newsagents over the Internet this week, said it had learnt key lessons from its mistakes and expected the rest of the rollout to progress smoothly.
The company has transferred responsibility for the SAP rollout from IT director Jeff Powell to Terry Reilly, WH Smith's operations director, in what the company described as a pre-planned move.
It has also created a group to liaise with newsagents to solve the outstanding problems with the system being installed for WH Smith by SAP specialist Axon.
The implementation had "not been managed as well as it might have been" in Manchester and Bolton, which became the first branches to accept the new SAP system in November last year, Reilly said. The experience allowed the company to refine migration procedures, Powell added.
WH Smith, which has rolled out SAP to 11 of its 51 branches, has told newsagents that it will not rollout the system further until existing problems are solved.
But Reilly said he did not expect any delays to the roll-out, which is still on target to go live at WH Smith's largest warehouse at Stockport at the end of this month. He described the most recent rollout in Blackpool as a great success.