Retail sales rebound, beating forecasts

December 28, 2010

Americans are splurging as though it’s 2007 again.

Shoppers spent more money this holiday season than even before the recession, according to preliminary retail data released on Monday. After a 6 percent free fall in 2008 and a 4 percent uptick last year, retail spending rose 5.5 percent in the 50 days before Christmas, exceeding even the more optimistic forecasts, according to MasterCard Advisors SpendingPulse, which tracks retail spending.

The rise was seen in just about every retail category. Apparel led the way, with an increase of 11.2 percent. Jewelry was up 8.4 percent, and luxury goods like handbags and expensive department-store clothes increased 6.7 percent. There was even a slight increase in purchases of home furniture, which had four consecutive years of declining sales. The figures include in-store and online sales, and exclude autos.

“For the past year or two, when I’ve seen growth in one area, it seems to come at the expense of another,” said Michael McNamara, vice president for research and analysis at SpendingPulse. “Here, things are actually all moving in the right direction.”

Of course, the broad increase was driven in part by higher spending on necessities like gas and food. And even with the across-the-board gains, some categories, like furniture and electronics, have still not climbed back to their prerecession levels.

Several retailers will report December sales in January, and they are trying to finish the month strong. A blizzard on the East Coast may have kept away shoppers on Dec. 26, when stores typically try to capitalize on store traffic for exchanges, returns and gift cards. But analysts said that the stores would not lose those sales — they would just be pushed later in the month, or into January.

The MasterCard data suggests that the pre-Christmas sales increase was the biggest in five years. Spending reached about $584.3 billion, compared with $566.3 billion in that period in 2007.

The 5.5 percent rise beat even the retail industry’s projections. The National Retail Federation was expecting a 3.3 percent improvement, and the ShopperTrak research service anticipated a 4 percent increase (both excluded automobiles, gas and restaurants).

“In the face of 10 percent unemployment and persistent housing woes, the American consumer has single-handedly picked himself off the mat, brushed his troubles off and strapped the U.S. economy on his back,” Craig R. Johnson, the president of the consulting firm Customer Growth Partners, wrote in an e-mail.

Analysts offered several theories for the rebound in spending while the unemployment rate remained stubbornly high.

Stocks have soared to their highest levels in more than two years, giving those with higher incomes greater freedom to spend. Luxury stores like Tiffany and Saks Fifth Avenue, for example, have been posting big sales increases.

Pent-up demand is also showing up among middle-income shoppers: in government surveys, consumers have been expressing rising confidence for the last five months.

The luxury segment started heating up in late summer, said Joel Bines, a director in the global retail practice at AlixPartners.

“That trickled down to the upper- to midtier consumer, and then the midtier consumer,” he said. Once the luxury market stabilized, confidence seems to have spread, “in the media, at work, with your friends,” he said.

The sales figures were bolstered by improved inventory controls among many retailers. After two years of heavy discounting, retailers cut the number of products they held in stock rooms, in an attempt to train shoppers to buy items at full price rather than wait for sales. The strategy seems to have worked.

Shoppers browsing through after-Christmas sales said in interviews that they were still hunting for deals, but they were also feeling that the economy was stabilizing after three years of merciless uncertainty.

In Pontiac, Ill., Gwen Hilsabeck rose at 4 a.m. Sunday for a 90-minute drive through snow flurries from her house to the upstate Woodfield Mall in Schaumburg, northwest of Chicago.

“I bought two dresses on sale at Ann Taylor, and I bought four dresses on the clearance rack at Nordstrom,” said Ms. Hilsabeck, a manager at a hospice company who said she had spent $800 to $900 so far.

“I’m spending more on myself because I’m starting to feel a little more at ease,” she said, “and my 401(k) has stopped going down.”

Where the snowstorms were not a factor, stores prepared for a wave of shoppers using gift cards. At J. C. Penney, Dec. 26 is usually the second-biggest day of the year in volume of transactions, including returns, exchanges and new purchases, said Myron E. Ullman III, the company’s chairman and chief executive.

J. C. Penney tries to attract teenagers, who are frequent recipients of gift cards, on Dec. 26 by bringing in new merchandise. People “have got money in their hand if they’ve got a gift card,” Mr. Ullman said.

Indeed, gift cards continued to be popular this year, and some shoppers said they were trying to maximize their value by using them during after-Christmas sales.

“It lets you shop the day after Christmas, so you can save a lot of money,” Shelly Lara, 42, an in-home nurse from Ashtabula, Ohio, said on Sunday.

She said that even though her family was doing fine financially, the Cleveland Clinic, which owned her company, had announced some layoffs, and her husband’s company had stopped contributing to his 401(k) for six months.

“There were some scares,” Ms. Lara said. “We wanted to make sure we got the most for our money.”

Stores seemed to have planned for the holiday season appropriately, with few resorting to the huge price slashing of the last couple of years.

“There was a good match between inventory and demand,” Mr. McNamara of SpendingPulse said. “I didn’t see any evidence of unusual discounting.”

For shoppers, that meant that the hunt for deals was a bit harder after Christmas this year.

“I remember a few years ago when you could double your money if you went shopping the day after Christmas,” said Kim Rayburn, 40, a hairdresser who was looking at costume jewelry at Forever 21 at Polaris Fashion Place in Columbus, Ohio, with her daughter Samantha, 12. “It’s not like that anymore. Now it seems just like a regular shopping day.”

For more information, visit: http://www.nytimes.com/2010/12/28/business/28shop.html?src=busln&scp=4&sq=retail&st=cse

What’s going on with the Shared Services concept?

December 27, 2010

The recent global economic downturn has left its mark on the retail industry and marketplace. As global companies emerge from the recession, CXOs of various Fortune 1000 companies across the globe representing the consumer-packaged goods, retail, quick service restaurants and other sectors have passionately articulated a common set of needs: to leverage their scale, to be truly global and to use their information as an asset. These needs have led to an increased interest in a global shared services model. CXOs want to use this recovery phase to drive global shared services to consolidate, define and possibly centralize key functions and services in the company to help leverage efficiencies of scale globally, reduce costs and deliver competitive advantage.

Shared services is an innovative service delivery model to provide administrative, support and maintenance services of enterprise applications to multiple customers delivered by a common pool of resources around-the-clock that could include employees, consultants, infrastructure, technology, reports, transaction and processing services,etc. The interest is there, but the concept can sound complex. The understanding, or lack of understanding, of the shared services concept often impede companies selling shared services internally, although the model has been employed successfully and has benefitted many companies.

Once you have decided that the shared services model is a good course for your company to take, the biggest challenge is gaining support from management. Convincing the boardroom to sell the shared services concept internally can be intimidating and most often, unsuccessful. Advocates that take up the shared services mandate are faced with skeptics that have a counter-argument ready. Most of these companies are grappling with three key questions: What does it mean to be a truly global company with global shared services? How do they convince their board on the vision, scope, nature and benefits of this strategy? How can they begin?

When they think of shared services, they often think of the potential challenges – external perception from customers that support is not exclusive or unique, change management, the cost to implement such strategy and whether or not this model would achieve immediate benefits, unique local practices in different regions and countries and how they would change in a global shared services model, local staff and their continuity, etc. Every cost saving business case is met with an alternative that ultimately puts the initiative on the back burner. For instance, one country head of a global beverage company explained that while his board loved the business case of immediate cost savings, once the topic of organizational change was brought up, the discussion was stopped short.

One approach that has worked for several companies is abandoning “shared services” all together. What they’ve done is deliver the concept by replacing the “shared services” label to “business enablement initiatives” or “platforms.” It may sound strange, but many advocates have succeeded in selling the idea to the company board by using this approach. For example, one CPG company we worked with looked at a completely non-traditional process – marketing – for which to create shared services. They set up a standardized technology platform for all their digital marketing needs and a “factory” of talented individuals who followed strong processes and methodologies that would help increase reuse and improve speed to market for their brand managers each time they wanted to launch an ad campaign. The creative ad agencies involved loved the model, and the metrics have helped this company demonstrate the power of shared services to the top line of the company. The critical win here is that the team never called this a “shared service,” but promoted it as a new “platform” that they wanted to adopt. Another company that set up a global shared service helping their front-line business development teams all over the world centralize administrative activities, called their initiative “Enabling the Sales Force.”

In summary, the recession and the recovery we are now experiencing has only strengthened the case for shared services to be an important initiative. There are numerous benefits to shared services. Those that have achieved some extent of truly global shared services are enjoying fantastic benefits of large cost savings, improved speed to market, better business user experiences of these services and more aggressive adoption of the model. In fact, the president of a highly successful CPG giant publicly explained that with shared services his company has saved more than $500 million, integrated acquired companies faster than usual, made their value chain more efficient, flatter and simpler, and now moving to digitize that value chain end-to-end.

Shared-services champions are creating momentum within their companies by using business-enabling initiatives to further prove that shared services have a strong business case across most company processes. For most companies, traditional approaches to internally sell shared services in the boardroom are difficult and they have to resort to new, innovative methods. That can be as simple as leaving out the “shared services” in your shared services initiative.

For more information, visit: http://www.retailingtoday.com/article/shared-services-boardroom-dilemma?ad=apparel-accessories

Need financing for your supply-chain?

December 27, 2010

No matter what the politicians in Washington are saying, the United States is married to China. And, this relationship has been nearly 40 years in the making. Ever since Nixon visited China, the United States has become more and more reliant upon low-cost Chinese goods. Indeed, according to The United States Trade Representative, the United States imported nearly $300 billion worth of goods from China in 2009 alone. To the extent an economic recovery in the United States depends on consumers spending at retail, the ability of U.S. importers and retailers to secure financing with respect to goods manufactured and exported from China is of critical importance.

While we all wear Chinese clothing, watch Chinese TV, and listen to Chinese manufactured mp3 players, the basic paradigm of financing imports from China has changed dramatically over the past two decades. What once was a transaction based upon letters of credit and payment upon shipment, is today a constant struggle between U.S. importers and their Chinese manufacturers/suppliers. Importers want to pay later in the process, sometimes as long as three months after the goods are shipped, while suppliers understandably want to be paid as soon as possible.

However, Chinese-based banks are hesitant to accept open account customer credit risk and in the current economic climate exporters are demanding payment as soon as possible after the goods are shipped to the United States. In some cases, due to slim margins and raw material price volatility, Chinese producers ask for deposits even before product leaves Chinese ports.

For retailers and importers, managing trade finance risk has never been more important due to persistent margin pressures and consumers unrelenting quest for value, a key component of which is price.

Historically the financing was assumed by large banks and factors such as CIT. Today these banks have either left the business, curtailed lending to only large, investment grade companies, restricted leverage, or have not changed fast enough to understand the new dynamic and offer the products that importers as well as exporters need to keep the retail supply chain functioning efficiently, effectively and without delay.

This new financial paradigm is only one side of the problem facing importers and exporters. On the other side of the equation is the consolidation in the American retail, apparel and furniture sectors. This consolidation has increased importers’ buying power, forcing Asian suppliers to use open account terms when financing trade with their U.S. clients. Because of this increased clout, importers not only are putting pressure on their suppliers to trade on open accounts, but also to pay as slowly as possible. Today, it is not uncommon for the order-to-cash cycle to be between 120 and 150 days from the date the purchase order is placed in China. This timeframe puts a significant financial strain on the supplier who typically desire payment when goods are shipped.

To help solve this tension between importers and suppliers, non-bank lenders have entered the marketplace. Non-bank lenders are not subject to the strict requirements that often limit the amount of unsecured credit banks will offer to many in the retail supply chain.

It’s why Capital Business Credit, a supply chain finance company historically focused on working with importers and their U.S.-based retail customers, decided to launch a new division called, CBC Trade Finance. Our objective was simple: to address the unmet needs of suppliers and importers in a complex and dynamic marketplace. The model is simple. CBC buys Chinese exporter’s receivables at the time of shipment, paying the supplier as soon as the goods leave for the U.S. The importer then negotiates with CBC a timeframe to pay the invoice – up to 120 days.

As the global economy improves, China and other manufacturing countries like Vietnam, Pakistan and Bangladesh will continue to produce the majority of goods sold in the United States. The ability for U.S. importers to secure incremental financing and to satisfy the demands of foreign exporters and manufacturers is critical not only to the success and working relationship between importers and supplier/manufacturers, but also to an eventual and sustainable economic recovery.

For more information, visit: http://www.retailingtoday.com/article/hidden-risk-imports

Blizzard may increase post-holiday sales online

December 27, 2010

New York City — Sunday’s east coast snowstorm disrupted sales throughout the entire area and disrupted one of the busiest shopping days of the year.

Sections of New York and New Jersey got as much as two feet of snow over the past few days, keeping many shoppers at home. Spending may shift into January, Marshal Cohen, chief industry analyst at Port Washington, N.Y.-based NPD Group, told Bloomberg on Monday.

“Look for sales to be repeated by retailers. They’re going to be more aggressive,” Cohen said.

The day after Christmas is one of the five busiest shopping days of the year, and it may take retailers two weeks to capture sales lost yesterday, Cohen told Bloomberg. At the same time, shoppers may lose their enthusiasm as the holiday season wanes, he said.

For some retailers, however, the storm brought benefits. Home Depot and Lowe’s Cos. sold out of snow blowers and shoppers bought more shovels and ice melt, Craig Johnson, president of New Canaan, Conn.-based Customer Growth Partners, told Bloomberg. The storm also likely will give online sales “a slight bump” on Sunday and Monday, he said.

The Standard & Poor’s 500 Retailing Index dropped 3.16 points, or 0.6%, to 508.67 at 10:39 a.m. EST on Monday. The index had gained 25% this year before Monday, compared with a 13% increase for the S&P 500, according to the Bloomberg report.

Consumers may temper their spending if the storm’s aftermath stalls shopping for several days and the frugality of New Year’s resolutions kicks in, Michael Dart, the San Francisco-based head of private equity at the New York consulting firm Kurt Salmon Associates, told Bloomberg.

New York City had 18 inches to 20 inches of snow by 7:30 a.m. local time Monday as the storm’s center shifted north and east, commercial forecaster AccuWeather said. The National Weather Service issued blizzard warnings for Boston and into Maine.

For more information, visit: http://www.chainstoreage.com/article/blizzard-hurts-retailers-post-christmas-shoppers-stay-home

Online 2010 holiday winners emerge - Walmart, Target, Best Buy

December 22, 2010

Walmart, Target and Best Buy attracted record levels of customers to their websites during November, according to data released this week by the online measurement firm comScore. Retailers have come to expect a surge in traffic to their sites as the holiday approach and during November that proved to be the case and then some.

Walmart and Target both experienced a 44% increase in the number of unique visitors to their sites during November when compared with October. The surge pushed Walmart to the 20th spot on comScore’s ranking of the top 50 U.S. online properties with a total of nearly 52 million unique visitors, while Target landed in the 27th position with nearly 40 million unique visitors. The number of visitors to Best Buy’s website grew at an even faster 75% when comparing November to October, which gave the company 28 million unique visitors and a 41st ranking on the comScore top 50 list.

“As the holiday season kicked off in November, Americans were quick to take advantage of retailers’ early promotions and saving in crossing a few items off their shopping list,” said Jeff Hackett, EVP comScore Media Metrix. “Cyber Monday, the Monday after Thanksgiving, came in as the heaviest online spending day on record in the U.S. which contributed a strong portion of traffic growth at retail and coupon sites.”

While Walmart, Target and Best Buy advanced their position on comScore’s top 50 list dominated by the likes of Yahoo, Google, Microsoft and Facebook, Amazon.com remains king of the retail hill. It attracted roughly 84 million unique visitors during November, placing it 10th on the top properties list.

The November figures are impressive when compared with October, but less so when compared with November 2009. In fact, unique visitor growth on a year-over-year basis has moderated somewhat, with Walmart, Target and Best Buy posting increases of 5%, 2% and 7%, respectively. Amazon.com’s unique visitor growth increased 8% when compared with November 2009.

For more information, visit: http://www.retailingtoday.com/article/online-2010-holiday-winners-emerge?ad=apparel-accessories

JC Penney Sets Aggressive Store Opening Plan

October 1, 2010

J.C. Penney Co. Inc. on Tuesday said it will open three stores next year as part of its plan to generate $1 billion in sales growth through new retail expansion over the next five years. Penney’s long term plans call for opening 75 new stores by 2014.

The first three stores are slated for Dallas; Daly City, Calif., which borders San Francisco, and Glenarden, Md., about 10 miles east of Washington. Penney’s has existing stores in all three markets, which cater to middle-income shoppers.

While Wal-Mart Stores Inc. slowed construction of SuperCenters amid the weakening economy and Gap Inc. has said it’s not planning to open new stores in the near term, Penney’s believes the markets it’s identified are underserved by its stores, so it will intensify its presence. The Daly City and Glenarden stores will open in the spring and the Dallas unit will bow in the fall.

Penney’s has an aggressive store-renovation program. By October, more than 750 units will have been renovated during 2010, including 76 major renovations, which took place in California, Florida, Illinois, Maryland, New York and Texas. Penney’s is aggressively expanding Sephora beauty boutiques. The retailer said stores with 1,500-square-foot Sephora installations are performing 1.5 percent better those without them. Other store improvements include in-store shops for new brands such as MNG by Mango, Call It Spring by Aldo, and new fixturing for the rollout of Liz Claiborne across 30 categories. Findmore interactive in-store fixtures are also making their way through the store fleet. Consumers can purchase from jcp.com using the technology.

Penney’s is investing $160 million on the improvements out of its $500 million capital- expenditure budget for the year.

The retailer hopes to complete the major renovations of more than 375 stores by 2014.

For further information, visit: http://www.wwd.com/retail-news?module=tn#/article/retail-news/penney-s-sets-aggressive-store-opening-plan-3310480?navSection=retail-news

Consumer Confidence Falls to Seven-Month Low

September 28, 2010

The tough business environment and strained job market undermined consumer confidence last month, which fell to its lowest level since February.

The Conference Board’s Consumer Confidence Index retreated to 48.5 from 53.2 in August. The measure of consumer well being stood at 51 in July and 54.3 in June.

“September’s pullback in confidence was due to less-favorable business and labor market conditions, coupled with a more pessimistic short-term outlook,” said Lynn Franco, director of the research group’s Consumer Research Center. “Overall, consumers’ confidence in the state of the economy remains quite grim. And, with so few expecting conditions to improve in the near term, the pace of economic growth is not likely to pick up in the coming months.”

The index is based on a survey of 5,000 U.S. households. The survey found that people are feeling worse about the current environment, with the 46.1 percent of respondents rating business conditions are “bad,” up from 42.3 percent last month.

For further information, visit: http://www.wwd.com/business-news?module=tn#/article/business-news/consumer-confidence-falls-to-seven-month-low-3309044

Retail Stocks Are Slowly Rising

July 29, 2009

Retail stocks rose Wednesday in the wake of better-than-expected corporate earnings reports. Apparel giant VF Corp. jumped after its second-quarter profit decline was smaller than expected and it signaled an improved second-half outlook.

The S&P Retail Index rose 1.4% to 344.99. VF, owner of brands from Wrangler to 7 for All Mankind, climbed 6.8% to $64.68.

The company said late Tuesday that while business remains tough and profit was hurt by a stronger dollar and pension costs, its largest brands – Wrangler, Lee, North Face and Vans, continued to gain market share. Chief Executive Eric Wiseman also said that profit and sales in the second half of the year should show a “marked improvement” from the first half.

The positive surprise from VF also bodes well for results from other apparel companies, analysts said. Jones Apparel Group Inc. rose 2.3%. Liz Claiborne Inc. was up 1.4%.

VF’s results “will alleviate concerns about another leg down in vendor industry earnings and represents a good first step towards rebuilding investor confidence in management’s ability to plan and execute after last quarter’s earnings disappointment,” said Credit Suisse analyst Omar Saad. “The fact that management is now seeing signs that international businesses are starting to stabilize suggests that the global apparel recession could be in its final throws in certain regions.”

VF’s net income fell to $75.5 million, or 68 cents a share, from $104 million, or 94 cents, a year ago. Revenue for the three months ended June 30 fell 11% to $1.49 billion. Analysts polled by FactSet Research had predicted the Greensboro, N.C.-based company would earn 57 cents a share on $1.53 billion in revenue. The company said it expects to earn between $4.70 and $5 a share for the full year, in line with analysts’ expectations of $4.84.

Investor sentiment also was helped by coffee giant Starbucks Corp.’s better-than-expected quarterly result and the company showed that its traffic has improved even as consumers remain watchful of what they spend. See full story. Tech bellwether Apple Inc.’s quarterly results also beat Wall Street expectations as it sold 5.2 million iPhone units and recorded strong sales of Mackintosh computers.

Largest U.S. electronics retailer Best Buy Co. was down 0.6%. Wal-Mart Stores Inc., the world’s biggest retailer that’s also making a push in electronics, was up 0.3%.

For further information, visit: http://www.marketwatch.com/story/retail-stocks-rise-as-apparel-giant-vf-beats-views

Retail Sales Rise; Wall Street Goes Up

July 25, 2009

U.S. stocks rallied on Thursday on investors’ relief that Federal Reserve Chairman Ben Bernanke was weathering a tough grilling in Congress relatively well.

Consumer discretionary shares had led stocks higher from early in the session, on positive news from the retail and home-building sectors that triggered a rally in the shares of home builder Lennar Corp and retailer Bed, Bath & Beyond.

The U.S. House of Representatives Oversight and Government Reform Committee questioned Bernanke on the Fed’s role in Bank of America’s takeover of Merrill Lynch, and whether he pressured BofA’s CEO Ken Lewis to go through with the deal after Lewis raised objections.

As the testimony wore on, however, analysts’ concerns faded and stocks sharply extended gains.

“There could have been a little apprehension ahead of this that Bernanke truly was in on forcing Bank of America (to buy Merrill), but that seems to have been blown a little out of proportion,” said Ryan Detrick, senior technical strategist at Schaeffer’s Investment Research in Cincinnati, Ohio.

“Nothing out of the ordinary is being reported so we’re getting a relief rally.”

The Dow Jones industrial average .DJI gained 138.15 points, or 1.66 percent, to 8,438.01. The Standard & Poor’s 500 Index .SPX rose 15.64 points, or 1.74 percent, to 916.58. The Nasdaq Composite Index .IXIC added 29.20 points, or 1.63 percent, to 1,821.54.

Home builder Lennar Corp posted a wider quarterly loss, but reported an increase in new home sales and orders. Its stock shot up 14.2 percent to $8.94.

The Dow Jones U.S. home construction index .DJUSHB jumped 4.1 percent.

Retailer Bed Bath & Beyond Inc reported a surprising increase in quarterly profit as it cut costs to offset slumping demand, and its stock soared 10 percent to $31.24.

Another bright spot among retailers was J.C. Penney Co Inc, up 6.1 percent at $28.223 after JPMorgan raised its rating on the stock to “overweight” from “neutral.

The S&P retail index .RLX shot up 3.4 percent.

The broad S&P 500 has climbed as much as 40 percent from March’s 12-year closing low on hopes the economy was stabilizing, but jitters over the strength of a potential recovery have stalled the rally recently. The S&P 500 is up about 36 percent from that trough.

For further information, visit: http://www.reuters.com/article/hotStocksNews/idUSTRE5501YF20090625

A Better Retail Experience For Winn-Dixie Customers

June 25, 2009

To ensure it stocks the right products in its stores and can authorize customers’ payments, Winn-Dixie must process thousands of real-time transactions every day. These transactions are underpinned by the company’s mainframe and server environment, which is also critical to the product pricing process.

To ensure its systems can meet the service level agreements demanded by the business, Winn-Dixie has deployed Workload Automation and Dynamic and Virtual Systems Management solutions from CA. These solutions provide Winn-Dixie with a centralized and real-time view of thousands of IT jobs and have helped to speed up the resolution of mainframe issues by 100 percent.

Winn-Dixie has been able to reduce business downtime, which means it can ensure that products are priced accurately, store stock levels are maintained and customer payments authorized. All these factors help to improve the retail experience and contribute to Winn-Dixie’s competitive advantage.

Business: Creating a better retail experience for customers

Winn-Dixie operates more than 500 stores across Florida, Alabama, Louisiana, Georgia Mississippi in the USA. Its stores stock grocery, meat, seafood, produce, deli, bakery, floral, health and beauty, and other general merchandise items.

Since emerging from Chapter 11 at the end of 2006, the company is focused on rebuilding trust in its brand, investing in its stores and generating profitable sales. The company’s ultimate goal is to be a leading neighbourhood grocer in every market that it serves. achieve this objective and compete with other supermarket chains, Winn-Dixie needs able to provide customers with great products and great service in a fast, friendly and fresh environment. The company has already embarked on a major store-remodelling program also investing in its corporate brands program, with the target of having at least 1,000 new product types on store shelves by the end of FY2008.

Challenge: Maintaining the right level of stock at the right price

To ensure both its own private-label products and national brands are constantly available stores, Winn-Dixie operates six distribution centres as well as three manufacturing plants. The distribution centres are at the hub of the company’s supply chain and each year ship millions of products to Winn-Dixie’s stores, which also encompass more than 450 pharmacies and liquor outlets. Daily sales breakdowns provided to the company’s management team as well as stock reports help to determine which products should be shipped from the distribution centre to each. This information is captured and processed by the company’s IT infrastructure, which also plays a key role in billing, buying, product pricing and authorizing customer payments. Dennis Horne, IT Systems Engineer for Winn-Dixie, comments, “If our IT systems go down, means we can’t update product barcodes, verify customer payments or offer self-checkout facilities. The business is reliant on our ability to process transactions in real-time: if IT stops, our stores stop.”

With IT playing such a critical role in the retail experience, many of Winn-Dixie’s core business processes are subject to stringent service level agreements (SLAs). To ensure these SLAs met, Winn-Dixie’s IT department must be able to ensure the availability and performance core systems, which include an IBM mainframe and more than 200 blade servers. Both the mainframe and server farm process an average of 5,000 jobs per day — these can include paying grocery suppliers, updating product pricing codes, sending stock requirements the distribution centers and collating store sales data. If any of these critical processes interrupted, then there could be a negative impact on Winn-Dixie and its customers.

We need to be able to quickly identify any disruption to our IT systems and their workloads and schedules,” comments Horne. “If a problem on the mainframe or a server goes unnoticed, then it could disrupt an important business process or application and cost the company thousands of dollars.”

To ensure it has sufficient visibility of its core systems, Winn-Dixie has been using the CA Workload Automation solution for five years. CA ESP Workload Automation enables Winn-Dixie to define, monitor, control, manage and integrate the workload of both its mainframe and distributed server environment through a single platform.

The CA solution replaced two disparate and database-driven Workload Automation management tools, which prevented Winn-Dixie from viewing IT jobs centrally and in real time. Now the company can monitor not only the scheduling of internal processes but also external transactions with suppliers and banks. “CA ESP Workload Automation provides us with a single pane of glass and helps us manage IT jobs more efficiently,” comments Horne. “Workload Automation is probably the most critical application for Winn-Dixie and ensures the seamless operation of our stores and supply chain.”

As well as ensuring that pre-defined business processes are executed in line with SLAs, CA ESP Workload Automation also enables Winn-Dixie managers to schedule specific IT jobs, such as creating a stock report for different product lines.

“Using the solution’s Web interface, managers are able to create bespoke reports without having to involve the IT team,” comments Horne. This has not only freed up IT resources but also reduced the time it takes to generate some management reports by as much as half. Mainframe problems resolved 100 percent faster. To further enhance the performance of its mainframe, Winn-Dixie also uses the CA Dynamic and Virtual Systems Management solution. CA-OPS/MVS® Event Management and Automation helps ensure that any mainframe problems are quickly identified and resolved. “Instead of just capturing event messages, the CA solution alerts us to a problem and the remediation required,” comments Horne. “We can also monitor started tasks and identify if a job finishes outside of normal parameters.”

The CA solution has simplified event management to such an extent that Horne estimates a 100 percent improvement in the IT team’s response time to mainframe problems.

Results: An enhanced retail experience for customers

For further information, visit: http://www.logisticsit.com/absolutenm/templates/article-retail.aspx?articleid=4715&zoneid=49