Can smaller retailers afford systems?
In the late 1980s the chairman of the retailer I was working for at the time, went to the US and found Arthur.
For those not familiar with Arthur, it is arguably the benchmark merchandise planning system in the world. For some inexplicable reason, JDA who acquired Arthur from Comshare in 1998, recently decided to drop the name and it is now referred to as Enterprise Planning, an incredibly stupid and boring change of brand name.
What Arthur at that time promised to do was to take location, product and time in a conceptual cube format so that retailers could plan using these three dimensions. And it could do this at the very lowest level. In those days Arthur was a mainframe application and ran on an IBM or ICL computer the size of a small country. Because it could plan at the lowest of levels, that is exactly what we fired the ICL up to do. Three days later the planning director said: “Turn the @#$%ing thing off”. And so Arthur died peacefully until the client/server version arrived.
So going back not that long ago, how did sophisticated retailers with hundreds of stores and thousands of SKUs plan?
The answer of course was Lotus 123. The DOS version long before Windows arrived. The IBM XT 5160 had been launched in 1983 and was a great PC for years to come. If you were a “normal” user, you had 256k of memory and a 360Kb 5¼ inch floppy drive. If you were a slightly heavier user you had a 1.2Mb floppy and the power users had a 10Mb or maximum 20Mb hard disk.
And what we did was really what all planning systems do today. We had Open to Buy on a spreadsheet. We did Range Planning by size, colour, fabric, price point, supplier, silhouette, units, input margin and average selling price. We did assortment planning and we had store profiles for allocations. We did all this at a class level and where appropriate, we summed it up to
department, division and company level.
Later the systems like Arthur made it all a lot easier and provided the ability to attach attributes which made the whole merchandise hierarchy less critical but what we did was pretty sophisticated stuff.
What does this mean to the small or medium retailer? Well, it means that you too can have access to the above if you know how to use Excel and if you have the time/resources. Sure it won’t be as elegant as an Arthur or similar product but it also won’t cost you much. It is hard to get change out of $1 million for any of the top planning systems and it’s easy to spend a lot more (although I know of a couple that do a fairly good job for a lot less).
But in Excel you can do it for nothing and get somewhat similar results compared to some of the best software out there.
Maybe start off with just one OTB for your business as a whole. Once familiar with this, you can divide your business and the OTB into departments. Later on you can tackle some of the others.
For a complimentary copy of an OTB, a Range Plan, an Assortment Plan or Store Profiling Excel spreadsheets, please email us specifying which ones you would like to receive.
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