Optimising operational and analytical data to drive more profit in a retail business.

Posted on:

April 8th, 2021

Posted in:

Insights & Thought Leadership

How Retail CFO’s can transition to data-driven omnichannel operations and see profits grow as a result. 

CFOs know that the financial future of their retail business lies in operationalising their data. Using a cloud-based enterprise data hub is the solution to being data-driven, and as a result, operating more profitably. 

“If you want to drive your business from £50m to £100m, the information you need is in your data.”

Financial Controller of a UK based DIY retailer

Complex supply chains in omnichannel retail

Every omnichannel retailer has the challenge of managing their customer journey across multiple systems. From the outset, the customer expectation is that they should be able to browse and purchase via the channel of their choice, whether that’s bricks-and-mortar shopping, mobile browsing, over the phone, via your website or social media.  

Once a product has been selected, often from 1000s of lines available, the customer will expect a similarly integrated and seamless experience when it comes to fulfilment. Again, more operational systems are required, with order management and logistics typically managed separately from purchase. 

Different channels and systems mean one thing is sure: data silos. Retailers may go some way to mitigating this situation by performing work-intensive manual consolidation of data to perform analytics, however it is inefficient. They are missing a single view of their critical data from which to drive the next best action for their business, in real time.

While functional, this is an approach that costs time and can’t scale. What’s even more concerning for CFOs is that they face real difficulty finding out which of the products generate a healthy profit and which lines are unprofitable and therefore need to be altered. Measuring direct product profitability is a science!

Getting a better view of your data doesn’t have to be disruptive.  

To operate more efficiently, retailers must be able to take an analytical approach to their data and be able to generate insight in real-time: in practice this means collating this information within one independent business intelligence tool, providing access to their management information in one view. 

A common concern is that getting one view of this data will involve migration to a brand-new platform, with all the risks and costs attached to the disruption of business-critical systems.  However, there is no requirement to take the route of legacy IT retirement, but instead, bring the data from existing systems into one enterprise-ready cloud data hub. In this way, information can be logically organised into one format that works across every one of your datasets. Meanwhile, your existing infrastructure stays in place to carry on doing its essential job with no risk to business continuity. 

Once the operational data has been consolidated in a hub it can then be used to power analytical processes, in turn providing the logic to determine and execute the next best action when it comes to business operation. This powerful perpetual loop of real-time activity, analysis, and action is what it means to be data-driven. 

Reaping the financial rewards of being data-driven

There are many benefits to creating one view of critical business data for omnichannel retailers, but let’s focus on the three most commonly cited results retailers are looking for.

  • A 360-degree view of all data allows for better decision-making at the operational and board levels.
  • Identification of areas of unprofitable products and processes in the supply chain.
  • Timesaving – no more manual data input! An automated data load provides an instant snapshot of business information, available to every team member in a self-serve format.

In the (succinct) words of the Financial Controller of a DIY retailer, “We are getting rid of the rubbish more efficiently and our gross margin has gone up.”

Summing up

For omnichannel retailers, access to real-time business analytics is critical to successfully managing complex supply chains. An enterprise-ready cloud data hub is the perfect fit to power business intelligence, data analytics reports, and dashboards teams need to manage product and customer lifecycles efficiently. As a CFO, you will understand what the data is telling you, allowing your team to respond to changing markets quickly. Clekt provides the platform and expertise required, accessed via a cost model based on the value you receive.

If you would like to read more about how we have worked with one  retailer to give them a better view of their data and, in the process, drive profitability, read our case study on Axminster Tools & Machinery