Case StudyIBM Systems and Technology Retail

Established more than 30 years ago, TJ Morris Ltd. operates one of the fastest-growing discount retail chains in the UK under the Home Bargains trading name. The privately owned company manages a network of more than 300 stores throughout the country, and supplies them from a state-of-the-art distribution centre located at its headquarters in Liverpool, England.

Home Bargains was founded on a simple principle: to sell name-brand goods at the lowest prices possible. As a discount retailer, success rests on the company’s ability to stock the right products at the most competitive price. For this, Home Bargains needs fast, accurate insight into sales trends across its retail network, or it risks missing out on opportunities to increase turnover and profits.

A spokesperson from Home Bargains explains, “Keeping prices low depends largely on our ability to seize deep discounts from suppliers, and to do so faster than competitors. For this, we need accurate information on how well certain products are selling in our stores, so we can make smart purchasing decisions. If we can stock products that customers want to buy, and at a price that beats other retailers, it puts us in a very good position for boosting sales and building brand loyalty with shoppers.”

Getting vital information to the business fasterPreviously, Home Bargains relied on an in-house store replenishment system to track sales and co-ordinate restocking activities between its distribution centre and each retail location. Sales data would be taken from individual stores at closing time and processed on the following day, leaving decision-makers to act on information that was not fully up-to-date.

“We saw that there was an opportunity to work better and more cost-effectively by reducing the amount of time that it took to calculate and allocate a store order,” notes a spokesperson. “Timelier information would give us greater agility and allow us to make faster, more accurate plans – from deciding what items to buy and how many, through to managing distribution workload and staff planning more efficiently.”

Home Bargains switches to real-time sales insight to seize better dealsWith a store replenishment solution from 3X Software and Verbatrans, powered by IBM technology

OverviewThe needTo keep stores stocked with high-demand, low-cost products, discount retailer Home Bargains must act fast to make smart sales decisions – or risk missing opportunities to reduce costs and boost profits.

The solutionHome Bargains switched to real-time sales data with a joint solution from 3X Software and Verbatrans, VBX Store Replenishment, running on an IBM® Power® 720 Express server for top performance.

The benefitWith near-instant insight into sales, Home Bargains can track demand more accurately, helping buyers seize the right deals from suppliers and maintaining optimum stock levels in stores.

Case StudyIBM Systems and Technology Retail

Selecting a unique offering from 3X Software and VerbatransTo improve planning activities and get the right products on the shelf faster, Home Bargains turned to VBX Store Replenishment – a joint solution from 3X Software and Verbatrans that streamlines the store inventory replenishment processes.

“We have been working with 3X Software and Verbatrans for many years, and they really know our business inside and out,” states a spokesperson. “When they approached us with the VBX Store Replenishment solution, we quickly recognised the value it could bring to the business.”

Guaranteeing top levels of performance with IBM technologyThe next step was to select a solid hardware platform, capable of delivering the performance and reliability that Home Bargains needed to get the most out of VBX Store Replenishment. For this, 3X Software proposed IBM Power Systems™ server technology, provided by IBM Business Partner Chilli IT.

Working with its service providers, Home Bargains deployed an IBM Power 720 Express server, running the IBM i operating system. Featuring the leadership performance of the POWER7+™ processor, the Power 720 Express enables Home Bargains to achieve extremely fast response times for the VBX Store Replenishment solution, ensuring that data can be accessed quickly.

Karen Anfield, Director at 3X Software, remarks, “We have extensive experience with IBM technology, and consider it to offer the best possible foundation for running critical business applications. Selecting a system that could support extremely high performance and reliability for the VBX solution was crucial for this project, and IBM Power Systems absolutely delivered on that requirement.”

Real-time sales dataWith the VBX Store Replenishment solution in place, Home Bargains can now record all transactions on a central server in real time, as each sale is completed in store. Using this information, the solution creates store replenishment orders – which detail the quantity and type of products to be allocated to each store – when the order is ready to be picked in the distribution centre.

When calculating and producing a store replenishment order, the VBX solution uses the previous week’s sales data up until the current hour. The ability to analyse sales by the hour allows Home Bargains to dynamically track stock levels, so that any discrepancies, out-of-stock and non-selling items can be identified and acted upon more rapidly.

Solution componentsHardware• IBM® Power® 720 Express

Software• IBM i• VBX Store Replenishment

IBM Business Partners• 3X Software Ltd.• Verbatrans• Chilli IT

Case StudyIBM Systems and Technology Retail

“VBX Store Replenishment allows us to process sales data in real-time, and produce orders incredibly quickly,” comments a spokesperson. “The solution takes just seconds to generate a store replenishment order and easily handles even our largest orders, which can exceed 1,000 cases of product. This means we are no longer tied to a rigid order schedule and can create orders more flexibly, when they are ready to be picked.”

By delivering real-time insight into sales data, VBX Store Replenishment provides Home Bargains with a significant advantage over competitors when it comes to seizing deals from suppliers. Equipped with up-to-the-minute information on how different product lines are performing, buyers can make more informed decisions about whether to act on a particular deal.

“Real-time information on sales helps our buyers take a more proactive approach to purchasing, and puts them in a much stronger position for making good deals with suppliers.” explains a spokesperson. “This means they can seize discounts before competitors, or back off on a deal when the demand is not there, which ultimately helps us keep stores stocked with products that customers want to buy, and at prices that other retailers often struggle to match.”

Better planning and forecasting Using VBX Store Replenishment, Home Bargains is able to forecast sales expected to be made even before an order arrives in store. The solution also takes into account products that have gone out of stock, and predicts what a store could have sold if the stock had been available.

These enhanced forecasting capabilities also extend to the company’s distribution operations. Home Bargains can now generate a forecast for its distribution centre up to 48 hours in advance, giving warehouse managers a better idea of future workload and allowing them to plan staffing levels more effectively to meet the demand. This has resulted in higher throughput levels at the company’s distribution centre and helps get new products to stores faster.

“We can control our order picking and distribution activities much more efficiently with VBX Store Replenishment,” says a spokesperson. “The ability to see the anticipated workload in advance makes for much smoother order management and staff planning, both at our distribution centre and individual stores.

“In the past, we would sometimes be caught off-guard by large, last-minute orders that left us scrambling to get products out the door and resulted in unexpected overtime costs. The VBX solution removes a lot of this uncertainty: we know the amount of goods coming in and out of the warehouse, and we can be sure to allocate the appropriate number of pickers to get orders out on time, so our stores do not go without merchandise.”

“VBX Store Replenishment gives us the agility to run a more profitable business and one that is more responsive to customer demand.”

— Spokesperson, Home Bargains

Running a flexible, profitable businessWith the VBX Store Replenishment solution supported by the leading performance of IBM Power Systems technology, Home Bargains has gained a new level of insight into its sales operations and built a solid foundation for optimal stock and demand management.

Having completed the rollout of the new replenishment solution, Home Bargains can now take advantage of accurate, real-time sales data to introduce new product ranges to stores, including fresh produce, helping to further expand an already successful business.

A spokesperson concludes, “We have gained unprecedented insight into sales across our entire retail network and can now take greater advantage of the information we already have on hand. VBX Store Replenishment gives us the agility to run a more profitable business and one that is more responsive to customer demand.”

About Retail Solutions from VBXRetail Solutions from VBX is a joint venture of two companies with deep retail experience and sound technical expertise – 3X Software Ltd. and Verbatrans – who work together to offer cost-effective solutions to the retail marketplace.

To learn more about Retail Solutions from VBX, please visit www.retailsolutions.co

For more informationTo learn more about IBM Power Systems solutions, contact your IBM sales representative or IBM Business Partner, or visit us at: ibm.com/power

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Produced in the United Kingdom December 2013

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