This trend is a great business opportunity for software vendors who are targeting the segment. Retailing is also the biggest source of employment, and generates more than 10 percent of India’s GDP. Organised retailing, however, occupies a miniscule two to three percent of the overall Indian retailing industry, but that is poised to change.

Explaining the growing importance of IT in the retail segment is Akshay Aggarwal, Head, Systems Engineering, BEA Systems India. “As monitoring and asset tracking in retail grows more stringent, there will be heavy reliance on upgrading or establishing IT systems aimed at enhancing productivity and improving processes. Technologies such as RFID and Web portals offer great business benefits to the retail industry.”

An SOA (Service Oriented Architecture)-based approach can also offer retailers certain benefits. On all fronts, the retailer and manufacturer are required to rethink their operations, from format differentiation and in-store innovation to real-time information facilitation for the customer. Notes Aggarwal, “SOA can help a retailer to better manage the diversity and complexity within his organisation, while at the same time improving business processes aimed at customers and trading partners.”

Mukesh Mathur, Head of Oracle’s retail business in India, describes how the company is targeting the retail industry in the country. “In order to enhance its offerings for the retail industry, Oracle has made a number of strategic acquisitions—including Retek, 360Commerce, and ProfitLogic—to offer the industry’s broadest set of retail-specific functionality globally and in the fast-emerging retail industry in India. Not only does Oracle provide all the key components—database, middleware and applications, all based on open standards— for the retail industry, but it also offers advanced analytic capabilities for retail, thereby enabling business intelligence. Also, keeping in mind the relative scale of operations of a retail company vis-à-vis large-scale manufacturing operations, Oracle applications do not require a big-bang implementation, and allow a retail entity to start with only minimum specific modules.” He continues, “We recently established the Oracle Retail Centre of Excellence comprising nearly 200 retail experts in Bangalore in order to better understand the needs of retail organisations."

Informs Mohit Oberoi, Senior Vice-president & Business Head, Polaris Retail Infotech, “Apart from the organised retail segment, which constitutes the Tier 1 retail chains, we also target the smaller retailers, or in our words, Tier 3 retail houses. As far as the break-up of the retail market in India is concerned, 92 to 93 percent marketshare is with the Tier 3 segment.”

Discloses Apurva Chamaria, Category Marketing Manager, Retail, HCL Technologies, “With organised retail contributing just about 2 percent of the retail industry in India, but growing rapidly, HCL is bullish about this vertical. Thanks to our engagements with leading global retailers, we have the domain expertise to share with three of the top five Indian retailers."

According to Ranjan Chopra, Chairman of Team Computers, “The awareness of IT systems is low among retailers, resulting in poor decision-making. In most cases, organised retailers in India have installed solutions that help them automate transactional systems. "

Understanding IT@retail

 With the retail sector in India undergoing a transformation due to the entry of large corporate houses, IT managers and CIOs are now looking forward to know how IT can help them achieve the business goals of their organisations.

Says Mathur, “IT managers have to become increasingly business-savvy, exploring ways and means to increase sales, margins and customer loyalty.”

Awareness among IT managers and CIOs of the retail sector regarding IT systems and applications is perceived to be low. Insists Chopra: “Most IT managers are only aware about transactional systems. When it comes to data analytics, many are in the dark.”

To which Aggarwal adds, “Our experience with IT managers and CIOs of the retail segment has been pretty interesting. They do have a legitimate requirement for a complete end-to-end IT infrastructure, but currently they are focussing on core retail applications like Supply Chain, ERP, Warehouse Management System and Store Management System. As they grow and tie up with more suppliers, distribution centres and stores across the country, they will require an end-to-end IT infrastructure that will integrate all their core applications and provide real-time information at the central data centre for the purpose of business intelligence and reporting.”

HCL’s Chamaria says that the retailers’ strategy is built around a structure that is business-driven, and IT is viewed as an enablement of the business to support the retailer’s strategy and business growth.

Mission retail
Oracle offers retail-specific functionality, enabling retail organisations to focus on

• Improving information integrity for the extended retail enterprise
  
• Enabling an insight-driven enterprise
  
• Collaborating with all stake-holders for greater efficiency
  
• Empowering workforce excellence
  
• Driving an excellent customer shopping experience.

Standards-based architecture and software support all kinds of mission-critical IT applications for enabling greater efficiency, significant cost savings, and new business value. The critical activities that can be handled by IT are finance and accounting, business intelligence, vendor development and management, supply chain management, merchandising and inventory management, facilities management, stores management, customer relationship management, branding, marketing, sales promotion and HR.