Case Study - Multi-national convenience store/gas station operator
Our Client is a Convenience Store retailer operating circa 2300 stores throughout Europe, Scandinavia and the Baltics, and Russia. RGIS has now delivered its SmartSpace® solution suite across a Citrix based environment designed to improve communications with their Head Quarters and satellite offices. This will ultimately improve individual store and company-wide performance by significantly cutting store planning, approvals and implementation costs during product realignment, refits and/or new store builds.
The Client identified a need to implement a Citrix capable macro space planning tool which would replace their current system, accelerate existing internal store planning processes, link to their existing micro space (planogramming) application and allow direct association of planograms to their store layout plans. The solution required the ability to analyse and report on the effectiveness of store layouts in terms of sales, profit and margin performance. Seamless links to Nielsen Spaceman and SAP were essential.
The key objectives of the project were to:
- Replace their existing store planning application that was not Citrix compliant.
- Ensure that all data inputs and outputs into and from their existing store planning system were maintained, improved and made to work.
- Support the change in culture towards improved management control of store space planning.
- Ensure that the measures put in place to encourage store level merchandising compliance and cultural change have been effective before proceeding.
- Obtain store merchandising data quicker.
- Store Clustering so that like for like stores could be analyzed, compared and planned together, ensuring that particular strengths and issues can be accommodated for.
- Improve the accuracy of store level merchandising data (actual data rather than assumed).
- Improve the measurement of the effectiveness of planograms in individual store layouts/configuration.
- Enable the use of 3D modelling of store merchandising layouts.
- Increase the number of space changes in stores that are 'right first time'.
- Integrate with and utilize data from existing merchandising systems used within the Clients business. This included integrating with the 3rd party micro space database and importing its merchandise hierarchy and planograms for association directly to fixtures within the store layout plan.
- Allow users to employ the analysis techniques of clustering and decision trees.
In addition to this the solution needed to support various planning, ordering, scheduling, and workflow requirements of multiple business units and locations including Planning, Merchandising, Purchasing and Store Operations, so that the different business units were unified and working with the “one version of the truth”.
Considering the objectives of the project and each of the business units involved, a fully-integrated, turnkey, and best-of-breed, macro space planning suite was the Client's best option: RGIS' Smartspace® Solution.
Smartspace® would ultimately enable quicker and more accurate decisions regarding space utilisation and juxtaposition of categories with an improved service in stores, as well as facilitating the efficient maintenance of accurate records of store level macro space and the actual merchandising of products in stores. They wanted to be able to optimise the use of every inch of merchandise space in stores. In order for them to achieve this objective, they need to be able to quickly analyse performance data and identify opportunities for:
- Departmental reviews
- Store Refurbishments
- Introduction of new product categories
- Introduction of new store formats
Smartspace® would deliver the criteria for the project's success including:
- A macro store planning system with the same “look and feel” as AutoCAD, that will allow users to create macro store plans for both new stores and existing stores (looking at revamps/extensions, and departmental reviews) by importing existing planograms and the underlying data from the 3rd party micro space system, thereby ensuring store plans are generated based on analysis of data rather than “what feels right”.
- Smartspace® interfaces with a number of data stores including SAP BW, in order to access additional supporting data for analysis, which is not currently used or accessed from within the 3rd party planogramming system, to include sales and margin data, product data, customer insight data, stock loss data etc.
- Smartspace® also had to feed the Store Clustering hierarchy from SAP in order to maintain the links between the stores within Smartspace® and the store level data within SAP.
- As well as providing users with the capability to create store plans, Smartspace® allows users to analyze stores both a spatial level and a performance level.
- Smartspace® had to also output this spatial data out to the current 3rd party system through newly developed interfaces and processes scheduled to be run on the Smartspace® database.
- Smartspace® allows users to view stores plans in 2D and 3D
- Smartspace® has a number of standard reports covering the following 4 areas, whose SQL templates were also used to generate the data exports to SAP:
- Store Spatial values, which included linear, square meter and cubic meter (volumetric) values for both fixtures and planograms.
- Equipment types and numbers which detailed the number of each class of fixture within each store.
- Planogram to Store Allocation - Smartspace® calculated automatically what planograms were assigned to a store, their spatial values and then rolled that data up to the planogram category level.
- Performance, e.g. report comparing and analysing existing store plans against an ideal or template store plan for stores of a particular size in a particular geographic area
- Smartspace® provides users with the capability to customise and create reports via selecting a number of data fields from the list of fields available in AutoCAD and their planogramming system.
The Client purchased Smartspace® “Out of the box ”, but with some additional customizations designed to significantly improve their planning process, to provide efficiency gains and as previously described import and export data to and from Smartspace® to SAP. RGIS developed and delivered these customizations at a cost to the Client, but at a reduced rate as the functionality required was seen to be a benefit to the overall generic application, and would therefore be offered to all existing and new Smartspace® clients. The process of development followed:
- Requirements Gathering and Discovery
- Smartspace® Solution Definition
- Smartspace® Development and Testing
- Analysis and Insights
RGIS' partnership with our Client delivered Smartspace® on time and within budget, due in large part to the team's exclusive focus on the key objectives, and RGIS' constant aim to improve project insight and efficiency.
The Client recognized the project as successful after the following milestones:
- Integration of the solution was completed to share both Micro and Macro space data between the systems and planning teams.
- The benefits began to be delivered and the solution is now being fully utilised through all elements of Department, Category & space changes.
- The system is running at the agreed service level and the data required was being transferred back and forth between Smartspace® and the SAP system.
The main benefits for the Client revolved around process efficiencies, improving store performance and delivering a fully integrated system between Smartspace®, their chosen 3rd party micro system and their SAP system. These benefits are detailed further below:
- Improved planning processes and efficiencies were realized through Smartspace® suite of tools and applications. As Smartspace® is fully integrated with AutoCAD the planners found the system comfortable and easy to use, resulting in the quick conversion from planogram to floor plan, and thus allowing the Client to seize opportunities as they were recognized in either single stores, whole regions, or even company-wide trends.
- With SmartSpace'® ability to cluster stores not only geographically but also virtually, precise definition and categorization of stores was possible, from which the business was able to make strategic decisions to improve under-performing stores, and to learn.
- Improved productivity was realized by utilizing the data from the Smartspace® reports. As a result, floor plans, promotional space, flows, fixtures, and lifecycle processes are now actively managed and optimized on an ongoing basis.
- Equipment costs have been reduced and contained as accurate part ordering functionality enabled efficient bulk purchasing of the required assets for either new store builds or remodels.
- Revenue has increased given the reporting insights that measured performance by zone, product allocation and planogram/category adjacencies, thus allowing store-specific and global changes to implemented and improve gross results. Also a sales uplift has been gauged and calculated based on the remodelling of existing space within stores to its optimum configuration.