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Through the agreement, the companies aim to offer products, platforms and services to help users reduce the total cost of ownership of their retail IT.
The extended agreement will offer users greater flexibility, according to the two companies. The companies said retailers would be able to deploy products in stages depending on their specific needs.
SAP and IBM said they would provide products and services for merchandise management, point of sale data management, web-based workforce deployment, merchandise and assortment planning and advanced forecast and replenishment.
The companies also plan to work with retailers to improve store performance by offering products and services to support master data management and radio frequency ID integration.
Under the agreement, IBM and SAP said they would also collaborate to share consulting knowledge in areas of business process analysis and best practices.