1 sap for retail overview

SAP AG 2004 - Andreas Lueckler, Industry Business Unit Retail & Wholesale 1

SAP for RetailSAP Runs Real Time Retailing


Agenda

SAP Retail Customer

Best Practices in Retail

mySAP ERP

SAP R/3 Enterprise for Retail

Evolution SAP for Retail

Development Projects

Future Store Initiative

Outlook – SDP Fashion


Agenda

SAP Retail Customer


Retail Customers 2003 compared to Dec 2002

Retail Customers Worldwide 1.696 (1367)Europe/Middle East/Africa 1.221 (1024)Americas 268 (225)Asia Pacific 207 (184)

Merchandise Management Customers**369 (269)Europe/Middle East/Africa 222 (188)Americas 100 (52)Asia Pacific 47 (29)

MC13 Customers Installations Live Install. SystemsTOTAL 1.696 3.736 1.468 7.427EMEA 1.221 2.438 1.003 5.018AMERICAS 268 688 208 1.351APA 207 593 256 1.058

*Source: ISP/CIS reporting, not incl. are the customer types SAP internal, -partner, -hardware partner and -logo partner.**Including Staffworks customers


Strong customer base worldwide

Grocery Health & Beauty

Convenience

Postal Services/ Telco



Fashion General Merchandiser

Catalogue Mail Order/ Internet Selling



Misc. Speciality Misc. Speciality



DIY/ Home Improvement Wholesale/ Cash&Carry/ Franchise Business

Home Furnishings


Go Lives 2003

Live with SAP Enterprise 4.7Incl. Purchasing, Master Data, Logistics (incl. VMI)

Live with mySAP RetailImplementation time: 6 months

Further GoLive with mySAP Retail in Italy, Roll-out to US in preparation

Upgrade to R/3 Enterprise

Upgrade to SAP R/3 4.6CProject time 9 months

Live with IS-Retail (3 pilot stores), FI/CO, Rel. 4.6c, 110 stores, 80,000 SKUs

Live with mySAP Retail and RetailAFS, SD, MM, WM, QM, FI, CO, HR

Live in 800 pilot stores (out of 15.000 stores/ partner agencies ). Project time: approx. 12 monthsLive with SAP Retail Enterprise


Go Live 2003

Moebel Pfister and Migros Aare upgrade to R/3 Enterprise

On September 1, 2003, Moebel Pfister, a leading furniture retailer, went live with SAP Enterprise. The customer has reported back a seamless project without any major project challenges. Moebel Pfister’s operations were never impacted by the upgrade in any way. The fact that the project was completed six weeks ahead of schedule and 20% below budget while meeting all the project objectives was the icing on the cake.

On October 12, Migros Aare, one of the ten cooperatives of the Migros Genossenschafts-Bund, successfully went live with R/3 Enterprise (upgrade from 4.5B) for their "Fresh items/perishables platform" - dairy and agricultural products (vegetables, fruit and flowers)as well as meat. The scope included a total of 14,000 articles and 2,000 users.

The project last just six months and despite challenges related to hardware replacement and the upgrade of the Oracle database as well as the operating system (Unix AIX), the project delivered tangible benefits: Generating the assortment list (HPR-Version) is now a matter of 30 minutes instead of 21 hours! The system is stable and the customer is happy.

Planned next steps are the upgrade to R/3 Enterprise for the cooperatives Luzern and Zurich. After that, the bakery assortment will be included and the rollout of the fresh item/perishable assortment will continue to the French speaking region as well as to Migros' convenience stores.


SAP R/3 Enterprise 2.0 Ramp-up customers

Ramp-up has started in December for Enterprise Extension Set 2.0

SPAR Management AG, SwitzerlandRamp-up has started last week for Enterprise Extension Set 2.0


Agenda

Best Practices in Retail


Segmentation of the Retail Industry

Best Practicesfor

‘SAP for Retail’

Preconfigured Systems

Best Practicesfor

‘SAP for Retail’

Preconfigured Systems

Standardization of Retail Enterprises

into four main segments

Standardization of Retail Enterprises

into four main segments

FashionFashion e.g. textiles, fashion, shoes

Hard GoodsHard Goods e.g. do-it-yourself, electrical,toys, sport equipment

FoodFoode.g. supermarket, discount store,convenience store, hypermarket, cash&carry

WholesaleWholesale e.g. supplying wholesale,Internet, mail-order


What are SAP Best Practices for Retail?

Working CRM prototype

Get a living and fully documentedprototype within days that you can rapidly turn into a productivesolution

Get a living and fully documentedprototype within days that you can rapidly turn into a productivesolution

Demonstration of a solution thatis easy to:Demonstration of a solution thatis easy to:

identify withimplementadapt to specificrequirements

Enable fast and easyimplementation of SAP for RetailEnable fast and easyimplementation of SAP for Retail

Traditional project

With SAP Best Practices

Time and effort savings

Identification and anticipation of reusable business processes and project activities


Agenda

mySAP ERP


What is mySAP ERP?

mySAP ERP is the successor ERP offering to SAP R/3 Enterprise

Functionality-wise mySAP ERP:Includes all the functionality of mySAP R/3 Enterprise

Plus a large number of additional business processes (SAP SEM, ESS)

Integrated and Personalized functionality(Business Information Warehouse reporting, role based)

Technology-wise mySAP ERP:Is built on SAP NetWeaver

(From 2004) further integration with SAP NetWeaver (Enterprise Portal, Exchange Infrastructure and SAP BW)

R/3Enterprise

R/3R/3EnterpriseEnterprise

SAP NetWeaver

mySAP ERP


Retail-wise mySAP ERP

SAP R/3 EnterpriseThe Retail Solution is included in SAP R/3 Enterprise, additional functionality has been developed in specific Retail Add-Ons(Enterprise Extension Set 1.10 and 2.0)

mySAP ERP 2004The Retail Solution is included in mySAP ERP 2004, new functionality has been developed in specific Retail Add-On (SAP ECC Extension Set 5.00)

mySAP ERP 2005The Retail Solution will be included in mySAP ERP 2005, new Retail functionality will be developed

General statement of directionThe core Retail functionality (merchandising solution) will remain part of ERP and will be further enhanced in the future (continuous improvement mainly) However, new Retail functionality will be developed also in other SAP components (SCM, MDM, CRM, etc.) andwill be tightly integrated with ERP functionality


The Architecture of mySAP ERP

SAP Web Application Server

Tec

hnol

ogy

App

licat

ion

SAP Basis

SAP R/3up to 4.6C

SAP R/3 Enterprise

mySAP ERP Edition 2003

Application

mySAP ERP Edition 2004

SAP R/3 Enterprise Core

SAP NetWeaver™ ‘2004

Com

posi

te A

pplic

atio

n Fr

amew

ork

APPLICATION PLATFORM

Life Cycle M

gmt

SAP Enterprise Extension Set

Composite Applications

PEOPLE INTEGRATIONMulti Channel Access

Portal Collaboration

INFORMATION INTEGRATION

Master Data Mgmt

Bus. Intelligence Knowledge Mgmt

PROCESS INTEGRATIONIntegration Broker

BusinessProcess Mgmt

J2EE ABAP

DB and OS Abstraction

Self-Service Procurement

SAP R/3 Enterprise

SAP R/3 Enterprise Core

SAP Enterprise Extension Set

Strategic Enterprise ManagementInternet Sales

Self Services

… and more

Additional Components

SAP ECC Core

SAP ECC Extension SetSwitch

Framework

Strategic Enterprise Management

Self Services

Additional ComponentsSelf-Service Procurement

Internet Sales

SAP ERP Central Component 5.0

SAP NetWeaver™

Com

posi

te A

pplic

atio

n Fr

amew

ork

APPLICATION PLATFORM

Life Cycle M

gmt

PEOPLE INTEGRATIONMulti Channel Access

Portal Collaboration

INFORMATION INTEGRATION

Master Data Mgmt

Bus. Intelligence Knowledge Mgmt

PROCESS INTEGRATIONIntegration Broker

BusinessProcess Mgmt

J2EE ABAP

DB and OS Abstraction

… and more


Release Strategy – SAP R/3 and mySAP ERPA

vaila

ble

with

myS

AP

cont

ract

s on

ly(e

.g. m

ySA

P ER

P or

myS

AP

Bus

ines

s Su

ite)

2002 2003 2004 2005 2006 2007 2008 2009

Ava

ilabl

e w

ith

SAP

R/3

con

trac

t

SAP R/3 Enterprise

SAP R/3 Enterprise Extension Set 1.10SAP R/3 Enterprise Extension Set 2.00

SAP R/3 Enterprise Core 4.7

SAP R/3 4.6C


SAP ECC Core 5.0SAP ECC Extension Set 5.00

mySAP ERP – Edition 2004

SAP NetWeaver’04

Other components (e.g. Self Service Procurement)

mySAP ERP – Edition 2003

SAP NetWeaver’03

Other components (e.g. Self Service Procurement)SAP R/3 Enterprise SAP R/3 Enterprise Extension Set 1.10

SAP R/3 Enterprise Extension Set 2.00

SAP R/3 Enterprise Core 4.7


The Architecture of SAP R/3 Enterprise

SAP Web AS 6.20 + 6.30

SAP R/3 EnterpriseCore 4.7

SAP R/3 EnterpriseExtension Set 1.10 + 2.00

SAP R/3 Enterprise

Optional new functional enhancements

(SAP R/3 Enterprise Extension Sets)

Tuned Core, optimized for Performance

(SAP R/3 Enterprise Core)

With SAP R/3 Enterprise, SAP has introduced a new development strategy. Primary focus: making deployment of new functionality optional. Plus: stability of existing processes Technology &

infrastructure enhancements(SAP Web Application Server)


The Architecture of SAP ERP Central Component 5.0

SAP Web AS 6.40

SAP ECC Core 5.0

SAP ECC Extension Set 5.00

SAP BW 3.5*SAP ITS**


Optional new functional enhancements(SAP ECC Extension Sets)

Ongoing consolidation of additional industry add-ons into

Extension Set layer

Traditional functionality as part of the SAP ECC Core(SAP ECC Core 5.0)

Optional enhancements on user interface for

SAP Enterprise Portal

Latest SAP Web AS synchronized with SAP NetWeaver ’04(SAP Web AS 6.40)

Integrated SAP BW 3.5 and Internet Transaction Server

SAP ERP Central Component makes use of SAP NetWeaver capabilities(such as existing and new functionality with direct support of SAP Enterprise Portal, reporting through integrated SAP BW…)

* SAP BW 3.5 can be optionally deployed within the same instance ** SAP ITS (Internet Transaction Server) will be partly integrated in SAP Web AS 6.40


Agenda

SAP R/3 Enterprise in Retail


Retailer´s Landscape

BI

Con

sum

er

Merchandise Management

Operativeplanning

Vendor SCM CRM

Sale

sProcurem

ent

StrategicPlanning


SAP Business Warehouse: Architecture


Knowledge Discovery / Data Mining

Promotion PlanningShelf optimizationAssortment planning

Direct marketingTarget group specificassortmentsMarketing controlling

Customer Groups

Subgroups e.g.Bargain huntersRegular customersStrategic customers

AB

C

Consumer‘s “ballot paper“

Buying Patterns

Companion Sales

e.g. “Beer and Tooth Paste“bought together on Thursday evenings shopping

Algorithms

When?

What?

How?

POS dataConsumer data


BW Business Content for mySAP Retail Enterprise

MarketData

MAPIntegration

RMAIntegration

CustomerRelation

StoreControlling

POS DataManagement

Close theLoop

ArticleInfosystem

CampbellIntegration

Data MiningIntegration

CategoryManagement


Features of a flexible merchandise planning system I

Business Information Warehouse

Complex Processes

Easy to use Different Currencies

Document Management

Multiple Key figures to plan€

US $

SG $

£¥157 005

398


Temporal dimensions

A

B

40

50

60

70

80

90

Jan Febr. März April

Flexible Input templates

UMS WE UMS-WE1000 500 5002000 1400 6003000 2000 1000

UM 1000WE 800(UM-WE) / UM 0,2

010203040

Plan Ist

Features of a flexible merchandise planning system II

Planning versions

Complex Hierarchies

Value and unit planning


Features of a flexible merchandise planning system III

Interfaces

Store AStore A Store BStore B

Special buy-20 %

Special buy-20 %

Allocation table / Promotion

Workflow

Authorizations

New Article

Prepack Allocation Planning

Article and Characteristic

Planning


Store Management with Enterprise Portals

Workflow Internet SAP R/3 Retail

POSPOSThirdThird PartyParty

Mobile Mobile DataData

CaptureCapture

SAP R/3SAP R/3HRHR

BW Reporting

SAP SAP RetailRetailStoreStore


Retail portal content: BP for Retail – Retail Buyers

Business benefit:Provides single interface for data and information retrieved from several systems to support the buying process in a Retail company. The application focus of the first version is on the daily/yearly negotiation with suppliers. Future development phases plan to cover promotion planning, assortment control and additional procurement processes. Also suppliers should be allowed to access their data from outside.

Users can:Define myEntities (Vendor, Sites)Manage daily vendor contactsMonitor Out-of-Stock situations & back orders

Roles:Retail BuyerStock Planner

Content systems:SAP R/3 & Business Information Warehouse


Retail portal content: BP for Retail – Store Manager

Business benefit:Provides single interface for data from several systems to support retail processes, personnel management, and store controlling

Users can:Support in-store promotions Manage staff and staff schedulesSupport pricing tasksSupport purchase order process Support goods receipt and controlling processes

Roles:Store Manager

Content systems:SAP R/3 Retail & Business Information Warehouse


SAP Retail Store - Architecture

R/3 Enterprise

BusinessConnector

ITS

BusinessConnector

SAP-XML

XML HTML

IDoc/RFC Dialog

SAP-XML

POSition


SAP Retail Store – Application Structure

Login-Screen

Main Menu


Example: POS Inbound / Store Replenishment

Runtime Test:

Data Volumes: 10,000 articles, 1,000 stores, 10 DCs

System: 16 CPU Database server + 6 application servers (8 CPUs each)

Step 1: POS Inbound (1) with 130 parallel processes100 million line items POS sales data (100,000 IDocs, aggregation ratio 10%)*

Step 2: Replenishment Calculation with 130 parallel processes

Check 10,000 articles per store, results in requirements for 20% of all articles

Step 3: Creation of Follow-On documents with 100 parallel processes

Create 1 million order pos + 1 million delivery pos + 1 million transfer order positons

Total Runtime: approx. 105 minutes

Runtime ca. 18 min ( more than 330 million line items / h)

Runtime ca. 30 minutes

Runtime ca. 58 minutes

*) 100 Idoc/store with1000 line items each


Planning Workbench - Process overview

Forecast

Automatic Load Building

Automatic CreationPurchase Order

PlanningWorkbench

Replenishment

Purchase OrderCreation manually


Merchandise Distribution

Synchronized procurement and issue achieved by means of a fixed assignmentPlanning, monitoring, and control of theaccelerated processing methods (cross-docking, flow-through) in the distribution center on the basis of this assignment

Two phases:Planning

• Push• Pull

Processing• Cross-Docking• Flow-through

Goods Issue

Goods Receipt


Returns in Retailing

External vendor

Store

Distribution center

Retail return

Return from customer

Return tovendor

Wholesale Customer

Return to vendor

Mail order return

Store return

Consumers(identifiable or non-identifiable customers)


Store and Assortment Management in SAP for Retail

Assortment„Beverages“

Local assortment

Automaticallygenerated Optional

Store A

Store

B C …D

Merchandise Category„Soft Drinks“

Cola, Sparkling Water etc.

Time Period

System Required

Store A

Store

B C …D

Assortment

Reference Storefor Assortment

Optional

Assortment„Beverages“ …02 03

Merchandise Category„Soft Drinks“

Cola, Sparkling Water etc.

Time Period

Local assortment


The Allocation Management Process

Head officeHead office

Merchandise is procured and allocated

StoreStore

StoreStore StoreWholesale

Distribution center

VendorVendor

plansplans monitorsmonitorscoordinatescoordinatesHead office


Allocation Strategies: e.g. Bottom-up Strategy (BW access)

Example:I need to buy and allocate a basic article for three stores to support a 4 week merchandise roll-out.

I expect the article will sell at about 110% the volume of a two week period (07/01/2003 – 07/14/2003) last year.

I want to forecast the sales of this article leading up to the roll-out and subtract that quantity from the current stock level and openorder quantities (by store).

The stores must display a minimum of 100 pc at the beginning of the roll-out, but their maximum capacity is only 350 pc.

Finally, I need to distribute the article to stores in multiples of 5 pc.


The Promotion Management Process

Promotionplanning

Promotionsubsequentprocessing

Carryingout thepromotion

Promotionfinal processing


Mark-Down Planning – End of Season Process

→

Markdown rule

• •80% 50%

•30%

Rel. price

Planning of markdowns

⇒Select articles and sites

⇒Article (also based on characteristic value)

⇒Price phases

⇒Sales prices

⇒Markdown in %

⇒

Quantities (planned sales quantity, stock remaining at end of season, ...)

⇒ Calculate margins

⇒ Compare planned /actual sales⇒ Remaining stock⇒ Range of coverage

Analysis of sales activity

Price activation⇒ Generate condition records ⇒ Update calculation

Sale of articles⇒ Feedback from POS

Adapt markdown planning (where necessary)

⇒ Move price phases⇒ Increase markdown in %

100%•

Time


Agenda

Evolution SAP for Retail


Evolution SAP for Retail from 1.2B to R/3 Enterprise 2.0

General availabilitySAP Retail integrated in R/3 Standard Release 4.0Worldwide Rollout

Mass Maintenance Value & Quota ScalesCompetitor PricingPricing – enhanced functionLayout & Space Management interfacesAdditionals integration Allocation – enhanced functionPromotion – enhanced functionSAP Retail Store (SRS)Load BuildingMerchandise Distribution (Cross Docking & Flow Through)Vendor Managed Inventory (VMI)Store ReturnsPerishablesSAP Online StoreWM integrationAgency BusinessRIS enhancements

Open mySAP.com integrationWeb Application Server 6.20BADI (Business Add-Inn)Business Configuration SetsHPR fully integratedHPR Assortment List Store and Assortment Mgmt.New Mass Maintenance ToolStyle (Variant) MatrixMAP – enhanced functionPrepack Allocation PlanningStore Manager PortalSAP Retail Store – PDC XMLSAP Retail Store – POS XML Markdown Pl.-enhanced functionAllocation - enhanced functionAllocation StrategyPromotion - enhanced functionReplenishment Workbench enhancementsMulti-Step ReplenishmentAHD / PDF in ReplenishmentPlanned Delivery TimeOrder CancellationSpace Management - enhanced functionLayout WorkbenchMerchandise Distribution -enhanced functionLogistics Execution System –enhanced functionTRM in LESPerishables – enhanced functionGlobal TradeRetail Method of AccountingConsumer Decision Tree

Easy Access, Screen redesignFast EntryHigh Performance Retail (HPR)Promotion–enhanced functionBonus BuyAllocation – enhanced functionMarkdown – enhanced functionLogistical VariantsProduct Catalog enhancementCompetitor Pricing enhancem.Market Basket PricingReplenishment WorkbenchAdditionals improvementsMerchandise Distribution –enhanced functionPerishables–enhanced functionMAP (Merchandise & Assortment Planning)MAP integration to Promotions & AllocationsBW Retail TemplatesSales Order OptimizationLayout & Space Management interface OptimizationVMI enhancementsLogistics Invoice VerificationSubs.Settlem.– enhan. functionPOS Inbound & Outbound OptimizationLogistics Execution System –enhanced functionHandling UnitsMulti Channel Retailing

Retail 1.2B

Overlapping PromotionsPromotion Delivery PhasesFamily PricingRetail Revenue Mgmt. – InterfaceCross-Docking (considering DC Stock at Delivery Creation)Cross-Docking (Automatic Handling of Structured Articles)Stock Transfer for ConsignmentAuthorities for Layout WorkbenchAllocation based on ShelvesCommunication of Placement Changes to the StoresConsistency Check of the Replenishment Master DataPRICAT Data Exchange with user specific fields & planned changesComplaints Processing in BillingIDoc Copy ManagementModifications to Store Order BAPIAutomatic Vendor Item Determination in Store GRPlanned Delivery Time in WorkdaysVMI for Wholesale CustomersAssign Invoice Items to PO and SiteBADI for Rounding in Sales OrdersPhysical Inventory for Open StoresSRS – Purchase Order & ReturnsSRS – Ruling PricesSRS – Order Rhythms

First Customer Shipment Retail Release 1.2B

SAP R/3 SAP R/3 Enterprise Enterprise

1.101.10 SAP NetWeaver

mySAPERP

SAP MAP (SEM)SAP Forecasting & ReplenishmentSAP POS Data ManagementSAP Profit Center AnalyticsSAP Customer Loyalty MarketingPortal – Retail Business PackagesFuture Store Initiative

1997 1998 1999 2000 2001 2002 2003 2004


Agenda

Development Projects


Development Projects 2003 / 2004 / 2005

40 %

SAP Forecasting & Replenishment (SCM)SAP Merchandise and Assortment Planning (SEM)SAP Profit Center Analytics (BW)SAP POS Data Management (BW)SAP Customer Loyalty Marketing (BW)SAP Enterprise Portals (Store Portal, Buyers Portal)Future Store Initiative

New Development Projects:Point Solutions, Portals

Customer Projects:SDP Karstadt

SCP EDEKA and COOP CH

Fashion Processes SAP Retail StorePromotions Planning

40 %

Continuous Improvement:SAP R/3 Enterprise EE2.00

Master DataSAP Retail StorePromotionsPricingMerchandise Distributionetc.

20 %


SAP Forecasting and Replenishment

Autom. Transfer Order Proposals

into Orders

Transfer Sales Data,Stock, DIF's, OpenOrders, Master Data

ReleasedOrders

Sales Stock Open OrdersDIF's

Replenishment QuantityOptimization

Order ProposalRelease Management

Exception Handling/ Manual Release

Masterdata

NetRequirem.

Automatic ReplenishmentQuantity Calculation

Order Pro-posalsExceptions

ReleasedOP's

R/3 Retail / ERP

SAP Forecasting and Replenishment

Manual Replenishment

OP f. man-ual proc.


SAP Merchandise and Assortment Planning (SAP MAP)

Strategic Plan

Merchandise PlanStore Plan

Assortment Plan

SAP MAP

Open Interfaces(XML)

Total Planning IntegrationStrategic planningStore planningMerchandise planningAssortment planning

Total Execution IntegrationBuying / OTBAllocationsAssortmentsSpace OptimizationMaster Data ManagementMarkdowns

Fulfillment

Assortment

Master Data

AllocationShelf Optimization

Purchase Order

Price Reduction

Business ScenariosFashionBasics / Lean Category Management

Out of ScopePromotion PlanningCampaign Management


SAP MAP – Slow Seller Management

MinimizeMinimize MarkdownsMarkdowns whilewhile EnsuringEnsuring Optimal Optimal InventoryInventory

Pre-season: Markdown Planning (Simulation)

In-season: Slow Seller Controlling

Execution in the Merchandising System

Assign markdown profiles and sales patternsto products to simulate:

When will the merchandise be sold?How large should each markdown be?What gross margin can I expect?

$3529.99 System evaluates pre-season plans versus

actual performance to automaticallypropose price reductions based on themarkdown profile.

Automatically update retail prices


SAP POS Data Management

SAP

BW

POS InboundProcessing Engine

Sales Analyses of POS Data

Store Contr.

PromoAnalysis

Loss Prevent

BW

-Rep

ortin

g Te

mpl

ates

Outbound Interfaces

mySAPLandscape

3rd PartyLandscape

Upload of POS Data to SAP BWvia POS Inbound Processing Engine


Profit Center Analytics

It is one Scenario which enhances and improves existing functionality by integrating SAP R/3 Enterprise, SAP BW and SEM.

It is based on the store as a profit center and the cost center that is assigned to it

Retail ledger in R/3, to replace the data storage for transaction data in EC-PCA. It guarantees efficient handling of big data volume, which is absolutely needed by storebased retailers.

Content in SAP BW to increase the reporting functionalities forstore managers as well as for management reporting

Content in BW for SEM as well as planning layouts and reports in SEM to increase planning functionalities for managers.


Customer Loyalty Marketing

Measure Results in BWMeasure Results in BWCustomer applies for loyalty card (store, phone, internet)Customer applies for loyalty card (store, phone, internet)

Upload of POS sales transactions into BW Data warehouse

Upload of POS sales transactions into BW Data warehouse

Segment builder accesses sales data and creates target groups in CRM

Segment builder accesses sales data and creates target groups in CRM

Target groups are assigned to campaigns in CRM and executed

Target groups are assigned to campaigns in CRM and executed

Once customer master data is available in CRM system , matching of customers’ sales transactions to master data is possible.

Once customer master data is available in CRM system , matching of customers’ sales transactions to master data is possible.

Shopper buys at POS with his/her preliminary card (usually a paper version of the genuine card )

Shopper buys at POS with his/her preliminary card (usually a paper version of the genuine card )

Execute Campaigns

Segement &Build target group

Submit cardapplication

MaintainCustomer Master Data

Sales at POS

Upload of POS dataTo BW

Identify POS customer

MeasureResults

Maintenance of Master data in CRM and replication into BW(Application template with customer attributes delivers basis)

Maintenance of Master data in CRM and replication into BW(Application template with customer attributes delivers basis)


Agenda

Future Store Initiative


Intention of SAP within the FSI

Research project on learning how to use RFID technology

Target: Get a pilot store live with leading edge technologyRFID on pallet level, case level, for all dry goods

RFID on item level for selected articles (CD´s, DVD´s [theft protection], smart-shelf)

Learn about requirements, benefits and process scenarios comingfrom RFID in a live environment

SAP to achieve leadership position for RFID related software inRetail and Consumer Products


RFID - Radio Frequency Identification

Key enabling technology for Smart ItemsRFID is an automated identification and data collection technology, leading to accelerated business processes and more accurate and timely data entry.RFID tags consist of a chip for holding data and an antenna for communicating the data through radio waves.

Many types of tags and readers exist today, i.e. active and passive, read / write, various frequencies etc

Reader API Air Interface

Controller

Net

wor

k

Tag/Transponder

Tag Antenna

Interrogator (aka Reader/Scanner)


RFID – Advantages and Business Benefits

Advantages:Uniquely identifies every physical objectUnsupervised identification

Any orientationNo line of sight required

Multiple readAnti-collision

Harsh environmentsRead & Write capability

Dynamic InformationReuse

Amount of data

Business Benefits:

Transparency along the Supply Chain within tracking of all objects

Optimized visibility of the goods flow

Minimizing the human resource factor within automatically identification of all goods movements

RFID increases quality, timeliness and depth of information


RFID Processes in Goods Transport and Delivery


RFID Processes in Warehousing and Frontstore


Agenda

Outlook - Strategic Development

Project Fashion


Product Fit for 2004 / 2005 - Case Study

SAP R/3 Enterprise 4.70Transactions,

SAP R/3 Enterprise 4.70 SAP BW 4.0

Extraction

Master data

Articles, merchandisecategories, SGs,

assortments, promos, conditions, themestructure, fixtures,

article list

SAP CRM > 4.0SAP CRM > 4.0Campaigns,

promotion planning

Master data

Actual/plan data(multidim)

F&R Enginereplenishment

process

Order proposals Allocation proposals

Master data, transactions

SAP SCM 4.0SAP SCM 4.0

POS data

Add-ons

Allocation table

Markdowncontrol A matrix

Allocation strategy

Store groupdefinition

Purchase orderOTB

Capacity datamaintenance Fixture

Level/capacity type

controlling, master datamanagement

Sales info

Retraction

SAP BW 4.0 Planning, reporting, analytical applicationsPIPE

POS InboundProcessing

Engine SEM BPS

Retail planning

Capacityplanning

Assortmentplanning

OTB

Markdown matrixapplication

A matrix

Plannedarticle

Fixture

Themestructure

Themestructure

Analyses for F&R

Relevant data

Exceptions Transaction data

POS analyses

Analyses forERP

Relevant data

Planned articles, OTB, listinginformation

SCEM


Primarily Requirements

PurchasingOrder entry (fast order entry)

Delivery period (tracking)

Bestseller-/Slow seller managementMark-down management

Allocation Flexible and short dated allocation

Invoice verificationMass maintenance

Payment before shipment

Vendor-ManagementVendor score card

PurchasingOrder entry (fast order entry)

Delivery period (tracking)

Bestseller-/Slow seller managementMark-down management

Allocation Flexible and short dated allocation

Invoice verificationMass maintenance

Payment before shipment

Vendor-ManagementVendor score card

Master dataArticle maintenance and selection on characteristic level

Article work list for all processes

Prepacks

Handling of approx. 6.5 million sku’s

Handling of 200 Department Stores

Handling of more than 20.000 departments

Planning & AnalysisAssortment planning

Rack and shelf planning

Closed loop

Analysis and reporting

OTB

ReplenishmentNever-out-of-stock (NOS)

Integration of events

Capacity check (on shelf level)

End-of-season monitoring

Master dataArticle maintenance and selection on characteristic level

Article work list for all processes

Prepacks

Handling of approx. 6.5 million sku’s

Handling of 200 Department Stores

Handling of more than 20.000 departments

Planning & AnalysisAssortment planning

Rack and shelf planning

Closed loop

Analysis and reporting

OTB

ReplenishmentNever-out-of-stock (NOS)

Integration of events

Capacity check (on shelf level)

End-of-season monitoring

Draft Version


Processes and challenges for SAP

Top-Down Planningorder Splitting / Open-To-Buy (OTB) Planning

Assortment Planningfashion

basics

theme structure

store grouping

capacity planning

assortment planning

Order Generation fast-order entry

simplified Master Data Maintenance

OTB generation

order controlling (tracking)

Subsequent settlement

Vendor managementvendor sanctioning

vendor evaluation

Master dataarticle hierarchy

store concept

article list

substitute & replacement styles

Allocationpre-allocation (long term view)

new-allocation (near goods receipt)

Auto replenishment (NOS)

Best / Slow seller managementmark-down planning

Draft Version


Outlook - Collaborative Master Data Management (cMDM)

mySAP...

R/3Enterprise

non SAPSystem

non SAPSystem

collaborative Master Data Management

cMDM – Advanced Technology Architecture

Master Data Server

Object Layer

Service Layer

Provisioning Layer

Content Integrator

cMDMAdapter

cMDMAdapter

cMDMAdapter

cMDMAdapter

Business Inform

ation Warehouse

Enterprise Portal

Exchange Infrastructure


Outlook - MDM for Retail development topics

1.Data Model Preparation Ensuring of Retail Data Model. Protection of a future Retail project.

2.Single Article/ SKUCentral maintenance and single distribution

3.

Generic Article/SKU, Set Lot DisplayCentral Maintenance and distribution

4.Col. Scenarios, Duplicate checkCentral Maintenance and distribution

Retail Sites, Organizational depended MD Central Maintenance and distribution5.

Purchasing/ Customer Info recordCentral Maintenance and distribution6.

Assortment, Listing Central Maintenance and distribution7.

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SAP for RetailSAP Runs Real Time Retailing

Thank You


Sources of Information on SAP for Retail (I)

SAP R/3 Enterprise and ERP Information Center: http://service.sap.com/enterprise

Information on SAP for Retail: (Retail Service Marketplace)http://service.sap.com/retail

Information on the new release and delivery strategy of mySAP.com:

http://service.sap.com/releasestrategy

SAP Help Portal: http://help.sap.com

SAP Enterprise Portal: http://help.sap.com SAP NetWeaver mySAP Enterprise Portal

SAP NetWeaver (Technology): (SAP Service Marketplace)http://service.sap.com/netweaver orhttp://help.sap.com SAP NetWeaver

http://service.sap.com/enterprise

http://service.sap.com/retail




http://help.sap.com/


http://service.sap.com/netweaver



Sources of Information on SAP for Retail (II)

Retail Performance Map: http://service.sap.com/performancemap

Information on the ramp-up process for bringing SAP solutions to market:

http://service.sap.com/rampup

SAP System Landscape Directory, description of mySAP.com system landscapes:

http://service.sap.com/landscape

Platform and Technology Information Center:http://service.sap.com/platforms

Information on upgrade, e.g. upgrade services, toolsand technology:

http://service.sap.com/upgrade

Global Trade: http://www.service.sap.com/globaltrade

http://service.sap.com/performancemap





http://service.sap.com/platforms

http://service.sap.com/upgrade

http://www.service.sap.com/globaltrade


Sources of Information on SAP for Retail (III)

Information on the changed maintenance strategy, e.g. extensions:

http://service.sap.com/MaintenanceStrategy

Information on SAP R/3 Interfaces:http://service.sap.com/r3-plug-in

Category Management: http://service.sap.com/retail SAP for Retail in

Detail Category Management

Education: http://www.sap-retail.de/education

SAP Retail Homepage: http://www.sap.com/retail

SAP Retail Solutions: http://www.sap-retail.de

Accessibility: http://www.saplabs.com/accessibility

http://service.sap.com/MaintenanceStrategy

http://service.sap.com/r3-plug-in

http://service.sap.com/r3-plug-in



http://www.sap-retail.de/education

http://www.sap.com/retail

http://www.sap-retail.de/

http://www.saplabs.com/accessibility

http://www.saplabs.com/accessibility


Sources of Information on SAP for Retail (IV)

Information on Space Management Integration:http://www.sap-si.com services industry solutions retail category_management

Information on mySAP ERP:http://service.sap.com/erp

Information on Ramp-up Knowledge Transfer (RKT)http://service.sap.com/rkt

http://www.sap-si.com/

http://service.sap.com/erp

http://service.sap.com/erp

http://service.sap.com/rkt

http://service.sap.com/rkt


Momentum


SAP and Karstadt / Quelle AG


Success Story – Metro Cash & Carry

METRO CASH & CARRY INTERNATIONAL GMBHmySAP™ HUMAN RESOURCES IMPLEMENTATION HELPS METRO MANAGE RETAIL ACTIVITIES WORLDWIDE

With its Metro Cash & Carry stores, which are managed under the brand names Metro and Makro, the Metro Group remains the international market leader in selfservice wholesaling. A benchmark analysis performed by SAP Business Consulting showed that, by implementingmySAP™ Human Resources throughout its network of stores, the group would experience significant savings and benefits.

“Once consolidated and processed, the quantitative and qualitative key figures provided a transparent picture of the operative and strategic potential per application area and for the company overall.”Ute RiemannHead of Benchmark Project for MCC.


Success Story – Swiss Post

SCHWEIZERISCHE POST (SWISS POST) IMPLEMENTS mySAP™ RETAIL TO TRANSFORM 3,300 POST OFFICES INTO RETAIL OUTLETS

Swiss Post turned to mySAP™ Retail to manage the sales of 4,000 articles across 3,300 post offices. Sales information like article, post office code, quantity sold, and sales price flows from the individual POS systems intomySAP Retail every evening. This enables Swiss Post to replenish stock and analyze sales todetermine what is selling, how much inventoryneeds to be replenished, and how profitable its operations are.

“With mySAP Retail, we are gettinginformation much faster and at a higherlevel of detail.”“The successful implementation will enable us to have a high level of transparency with our sales data. This will help us to quickly react to new customer requirements.”Christian Oberschartner, Project Manager, Swiss Post


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