5 Key Benefits Of An Integrated POS/ERP System
In addition to planning a store’s location, layout or products, a priority that a retailer should consider is how to manage the lifeblood — inventory and tender transactions or different streams of data — of the business. That’s where an integrated retail system comes in.
Sometimes, though, new stores purchase a retail system that they can start with right away without fully understanding what they need in the long term. Or, some business owners don’t make the transition because they are used to having separate systems for different sets of data.
But integrating different streams of information — for example, point-of-sale, inventory, merchandising and financials — enables companies to grow strategically and manage costs.
Here are five key benefits of data integration in a retail system.
- Checks and balances: It’s common for discrepancies to occur when store associates manually enter or transfer information. However, an integrated software system has a checks-and-balances mechanism in place when analyzing and managing different sets of data.
- Drill-down capability: A financial statement is loaded with information, but it takes an integrated system to drill down for the nuggets of data down to the receipt level. This type of system can break down year-to-date sales by date range, time of day, store location, specific product or item price. After drilling down, the system can go back and aggregate big-picture data. For example, after discovering a hot-selling item in a specific month, the system could then identify seasonality trends and the effects of price changes. Having an integrated system enables retailers to construct data in multiple ways, ensuring that they can find the information that they are looking for.
- Real-time tracking: An integrated system tracks data in real time, enabling a retailer to view financial results daily or hourly, if necessary. If a retailer has a separate financial system and a separate POS system, the frequency of viewing financial results is likely limited.
Store replenishment: Retailers can look at data integration in two ways: Does each store stand on its own with its own set of data, or is each set of data treated separately with its own application and technology? While some separate systems may work together, most of the time, retailers won’t be able to start from a financial system and aggregate or drill down information from a POS receipt.
Consider this: Inventory sales data comes from a POS system and inventory purchasing originates from a store’s financial system. An integrated system can combine these two functions, enabling companies to create an automated store replenishment system. For example, if the inventory level for a specific item gets low, the integrated system can automatically create a purchase order to restock it. In addition, the company’s financial leader can easily see all the purchase orders in the system and anticipate the cash flow.
- Pricing management: Pricing inventory can be an art. Knowing which items aren’t moving and just consuming shelf space would be welcome information for those responsible for pricing items. The ability to centrally construct deals, offers, coupons and other promotional pricing offerings and the view the effect they had on sales would be valuable to any retailer. At the heart of the deal is the customer. Sharing customer information across stores — their purchase history, interests and trends — can also yield surprising results.
All of the above is possible with a properly implemented integrated system along with some solid planning and effort.