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Explaining how SAP creates value for the Retail industry.

<div id="content"><p tabindex="0">This video will equip you with the knowledge and tools to transform products, services, and IT operations while staying competitive. We will cover key trends shaping the Retail industry and SAP's best-of-suite solutions for the Retail industry value chain.</p><div class="note"><div class="noteTitle"><span class="noteIcon"><img title="Note" src="/icons/note.svg"></span><span class="noteTitleText">Note</span></div><div class="noteBody"><p tabindex="0">SAP employees and official SAP Partners can <a target="_blank" href="https://sap.sharepoint.com/:p:/r/teams/2024Industry101update-admin/_layouts/15/Doc.aspx?sourcedoc=%7B1735EB6F-AC4C-45A9-9517-A3C151783ECE%7D&amp;file=Unit%202%20-%20Lesson%201%20-%20SAP%20for%20Retail.pptx&amp;action=edit&amp;mobileredirect=true">download the slide deck</a></p></div></div><div class="kalturaVideoLessonWrapper"><div aria-label="" class="kalturaVideoLessonContainer" data-testid="video" id="1_hih5pv5e"></div></div><div class="parentsection"><div class="section"><div tabindex="0"><h3>Lesson Summary</h3></div><p tabindex="0">From time to time, industries face certain challenges such as:</p><ul style="list-style-type:disc"><li tabindex="0"><strong>Customer Acquisition Costs:</strong> Full visibility and control over acquisition costs</li><li tabindex="0"><strong>Operational Efficiency:</strong> Streamline processes to boost margins and sales</li><li tabindex="0"><strong>Supplier Performance:</strong> Supplier Performance: Ensure quality, price, and timeliness</li></ul><p tabindex="0">SAP Retail Solutions are here to help with these challenges through navigation, driving innovation and providing measurable value across operations. This lesson covers some key business trends, such as:</p><ul style="list-style-type:disc"><li tabindex="0"><strong>Transport Supply Networks:</strong> Anticipating customer demand</li><li tabindex="0"><strong>New Business Models:</strong> Innovative revenue streams and customer engagement</li><li tabindex="0"><strong>Personalized Stores:</strong> Personalized Stores: Blending digital and physical experiences</li><li tabindex="0"><strong>Sustainability:</strong> Adopting ethical and eco-friendly practices</li></ul></div></div></div>

SAP Value Creation for the Retail Industry

Introducing the Retail Industry

Demonstrating SAP Value Creation for the Retail Industry

Hello, and welcome to the SAP for Retail Training. In this video, we will give you an example of how you can present the retail story to our customers. The industry is under pressure, whether it's evolving customer expectations, tighter margins, or the ever-present competition. As we navigate these changes, certain questions and challenges repeatedly surface across different roles along the retail value chain. These might be familiar to many of you. Let's explore them together. How can I ensure that the cost of acquiring new customers is fully accounted for? Acquiring new customers has always been a challenge and it's essential to have full visibility and control over acquisition costs. Are we accurately capturing the true cost of bringing a customer through the door, both online and in-store, and more importantly, are we optimizing our spending to ensure maximum return on investment? Can I maximize my efficiency in retail operations and fulfillment to boost margins and sales? Operational efficiency is the backbone of retail success. It's not just about getting products on the shelf or delivered to the customer on time. It's about doing so in a way that enhances profitability. In an environment where margins are key, how do we streamline processes, reduce waste, and improve speed, all while maintaining or even enhancing the customer experience. I want to ensure optimal supplier performance. Strong supplier relationships are crucial. Inconsistent performance can lead to stock-outs, overstock situations, or even worse, a damaged reputation. Are our suppliers meeting their commitments in terms of quality, price, and timeliness, and if not, do we have the right strategies in place to address these gaps effectively? How do I ensure inventory turnover and accuracy while minimizing delivery times, logistical costs, and wastage? Inventory management is a crucial challenge. Balancing inventory turnover with accuracy is key to reducing logistical costs and minimizing waste. But it's a complex equation, one that requires careful fine-tuning of supply chain logistics, demand forecasting, and real-time inventory tracking. Are we hitting the sweet spot, or are we still grappling with inefficiencies? How do I ensure optimal promo conversion, sales per square foot, employee efficiency, customer service, and basket size? Promotions, store layout, and employee engagement are all levers we can pull to drive performance, but are we pulling them effectively? It's essential to evaluate whether our promotions are converting at the desired rate, whether every square foot of our store space is generating optimal sales, and if our employees are empowered and efficient enough to deliver outstanding customer service that ultimately increases basket size. By focusing on these areas, we can ensure that we're not just meeting expectations but exceeding them. How do I ensure growth in market share, shareholder value, market capitalization, and strategic longevity? Finally, the big picture questions that keep C-levels awake at night- growth in market share and shareholder value requires a blend of strategic foresight and operational excellence. How do we ensure that our strategies today position us for long-term success, both in terms of market presence and financial health? Conclusion: These questions aren't just theoretical. They are at the heart of what it means to be successful in retail today. The solutions may vary, but the necessity of addressing these challenges is universal. As we continue our discussion, let's explore how we can tackle these issues head-on and transform these challenges into opportunities for growth and innovation. As we look at the current landscape of the retail industry, it's clear that the challenges are significant, but so are the opportunities. SAP retail solutions have been instrumental in helping leading retailers navigate this complex environment, delivering measurable value across their operations. Let me share with you some recent success stories from our customers who are at the forefront of this transformation. These examples demonstrate how SAP retail solutions are not just about keeping up with the pace of change. They're about setting the pace. Each of these customers faced unique challenges, and with our tailored solutions, they were able to turn those challenges into opportunities for growth and innovation. What are the key business trends in retail? Creating transparent and customer-driven supply networks with a digital supply chain. This means anticipating customer demand and providing the right products at the right time. To do so, retailers need to bring in forecasting, allocation, and replenishment solutions to optimize the processes. Data-driven experiences. As the digital world continues to evolve, businesses are presented with an invaluable resource, the consumer data. By implementing data-driven solutions, retailers can stay ahead of the curve and meet the ever-changing demands of their customers. And we have the continuous pressure on margin. This can be attributed to increasing competition, to customer demand for lower prices, and to growing operational costs. To address this issue, retailers need to enhance efficiency, reduce costs, and optimize pricing without compromising on customer experience. The most obvious path to growth is creating new business models within their own ecosystem. This strategy opens doors to innovative revenue streams, to bolster customer engagement, and to strengthen their market position. Redefining stores is a strong value proposition to our retailers, providing personalized shopping experiences for the customer and connecting digital and physical spaces. Serving the segment of one, is a growth ambition directed towards the individual customer needs. Personalize the purpose, differentiate through value-added services, and use digital capabilities to meet the unique needs and preferences of the retailer's customers at scale. Obviously, retailers are also facing challenges. And geopolitical tensions lead to supply chain issues. Rising energy costs add another layer of complexity, affecting both operations and transportation costs. At the same time, the consumer behavior is shifting. Higher prices affect shopping habits, empowering discounters and private labels. Combined with an inflation that has reportedly reached a 40-year high, consumer purchasing power as well as overall business operations are impacted significantly. Inflationary pressure leads to rising cost of goods, to reduce profit margins, and to increased prices for consumers. However, challenges also bring opportunities for growth. Customers are actively seeking brands that align with their values and have strong social, environmental, and political ethics. By adopting sustainable practices, reducing waste, using eco-friendly materials, and supporting fair trade, retailers can attract and retain customers who are passionate about ethical choices. With a dedicated strategy on store innovation, retailers are able to meet the changing behavior and expectations of their consumers by focusing on hyper-personalized customer experiences and transitioning from an all-me channel approach to customer adaptation. Shoppers demand visibility into store inventory, a seamless connection between online and in-store experiences, and the convenience of ordering items for in-store pickup. Disrupted supply chains have a significant impact on the retailer's business. For example, causing delays in product deliveries may lead to empty store shelves and eventually to decreased customer satisfaction. For retailers, a resilient supply chain and full transparency are the focus areas for innovative investments to ensure profitability and prospective financial performance. The question of how to measure profitability across the company is addressed in the retail value chain, marketing and customer experience, merchandising, sourcing and procurement, supply chain, and omnichannel and store operations. The heart of retail transformation is the need for relevant and personalized shopping experiences with the goal of turning shoppers into brand advocates, not only by understanding customer needs but also by delivering products and services that exceed their expectations. In today's fast-paced and ever-changing market, resilient supply chains can be the most critical part of retail. Retailers empower their supply chains to adapt to changes quickly and efficiently, preventing disruptions and ensuring products that are always available when needed. Designing a circular supply chain, from the suppliers to the consumer's homes and back, will not only emphasize sustainability efforts, but also enable fast responses to changes in demand and supply. A circular supply chain allows for a more flexible and efficient system, reducing waste and creating a more resilient business model. And instead of providing anonymous shopping experiences with standard takeaway services, many retailers are turning to digital solutions offering personalized and value-added services. Understanding and meeting unique customer needs at scale is not only about owning detailed customer data, but it is about knowing how to turn data into information to achieve higher customer satisfaction and therefore better business outcomes. Customers today are more conscious of the impact their purchasing decisions have on the environment and therefore more likely to support brands that share their values. Offering a curated assortment of sustainable products means selling a value system that resonates with the customer and gives a strong competitive edge in the market. Nevertheless, the future of retail requires a different role of the physical store. It will become the command center for unified commerce, bridging the gap between the digital and physical retail worlds. Store associates need to be empowered to really personalize each consumer's trip, enhancing shopping experience, and fostering customer loyalty. And with vertically integrated business models, retailers can even more increase efficiency, reduce cost, and eventually provide a more seamless customer experience. This concludes part 1. Let's look at the business capabilities SAP can provide along the retail value chain and how customers are using these in more detail in the second part of this session. Thank you for watching.