Irish retailer Arnotts is spending £4.7m on an implementation of Oracle's retail application suite to streamline...
its procurement and reduce the stock it needs to hold in store.
The applications will integrate information flows on all aspects of the department store's operations, from supply-chain management to merchandising and accounting. Arnotts aims to finish the roll-out by December and to break even on the investment in three to five years.
Arnotts reviewed its IT strategy as part of its redevelopment of Northern Quarter, a 1.3 million-square-foot shopping centre in Dublin.
Paul Dickson, Arnotts' director of information systems, said the firm faced "a non-negotiable need to cut 100,000 square feet of storage space", but still had to make sure the right stock was on the shelves at the right price.
"We needed an integrated ERP system that allowed us to cut on-site inventory but reduce on-shelf non-availability of products," he said.
Arnotts took a very "non-IT" approach to the project. "Instead of just using up whatever budget was left at the end of the year, we tried to hook the IT strategy to what drives the business, and to do it in as vanilla a way as possible," said Dickson.
He said the biggest challenges in the project were not technical but political. Supplier relationships had to be renegotiated and business processes were reorganised to ensure that the right balance of products was always available.
Arnotts looked at various retail systems, including SAP, but chose Oracle's retail software, which it acquired in 2005 from Retek, for its development flexibility.
"This software that is the heart of Oracle Retail is well known among retailers like us, so we were comfortable with it, and it was a better cultural fit for us," Dickson said.
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