Retail is one of the fastest growing and “sensitive” business sectors.
It is vulnerable to all changes and upheavals from the outside like nothing else. The Covid-19 pandemic and the following restrictions have already impacted all areas of the consumer sector. However, the difficulties have not ended here.
Based on the expertise of retail experts, let’s take a look at what challenges retailers continue to face and how the right digital transformation strategy can help overcome retail challenges.
The Retail Industry Today
The pandemic and worldwide lockdown have really shocked the retail market. At the same time, the unfavorable global situation has generated new opportunities for business development.
Those who have quickly adapted to the situation and found ways to change their business strategies have managed to survive the corona crisis and strengthen their position in the market.
While there are many ways to grow your business potential, technology transformation is at the heart of any effective strategy. The ability to thoroughly prioritize digitalization is your key to success today.
But how to make the right decision? First of all, you should understand the main challenges of the retail business.
Top Retail Challenges in 2022
1. Lack of a single integrated system
Still, many companies continue to work in disparate systems, even though the amount of data is growing every year. This results in a lack of a clear understanding of how company data is used, which is especially important in finance and reporting.
By integrating all data into a single system, processing generated data and managing it from any device, you will ensure the data is used correctly and contribute to rapid decision-making.
2. More choices, less loyalty
Today, it’s really simple to lose a client’s loyalty. For instance, you can just answer a potential customer via support chat or a chatbot a few minutes later than your competitors. A wide range of online stores, which you can visit in one click, leads to a decrease in loyalty to your brand.
What should businesses do in this situation? This loyalty can be increased by delivering an impeccable customer experience using the latest technologies to analyze customer behavior and anticipate their desires quickly.
3. Support various sales scenarios
Retail today is more than just a shop-buyer. The delivery chain of a perfect shopping experience consists of many elements, such as ordering, processing, delivery, and self-delivery. To avoid failures at any stage, it is vital to have a solution that will ensure smooth operation and help you effectively manage goods in real-time, regardless of the scenario.
4. Inefficient stock monitoring
Retailers often face the situation when some products are in short supply and others that are not popular just occupy space in the warehouse. This seemingly ordinary situation leads to significant losses. Balancing inventory with up-to-date customer demand data and supply chain visibility helps you plan and manage your warehouse and supply chains.
5. Old friends and old wine are the best
Did you know that 20% of loyal customers generate 80% of your business’s profits? However, many companies seek to attract new customers while neglecting to build and maintain the loyalty of the existing ones. A proven way to increase sales is to work on the client base, but not all companies understand its potential.
SMS, email or social media alerts, information gathering through surveys, and loyalty programs 一 all these help customers feel important and encourage them to shop more often and more intensively.
6. Ecological agenda
According to the Deloitte reports, 28% of those surveyed said they started or expanded their relationship with companies whose products or services benefit the environment. Moreover, about a third have stopped relations with those organizations that harm the planet.
These realities are pushing retailers to look for solutions to green their processes, from logistics to waste disposal.
Finding the Right Solutions
SAP solutions have already helped many retailers overcome challenges, increase sales, and take their businesses to the next level. Want to ensure competent work across all channels and get real-time customer data? SAP S/4HANA Retail for merchandise management is at your service.
Are you looking for a unified system for automating the accounting process? Consider SAP S/4HANA Cloud, which helps manage all financial operations, from recording income and expenses to merging all the data.
SAP can help you get on the path to technological transformation and obtain benefits from any challenges. However, it’s always a good idea to turn to a trusted and reliable SAP solution provider to get the most out of your investment in SAP.
Additionals:
