Creation of Retail Back Office Solutions: Guideline

“It’s needed to have one foot rooted at the heritage of the past to make sure we understand where we came from, and one confident step forward in terms of driving innovation forward.”

James Curleigh, Levi’s Brand President

A retailer's self-awareness is what helps it to make customers and employees joyful. It's hard to satisfy the first ones' needs without the harmonious work of the last ones. Therefore, both groups of people should be inspired by interaction with the company. Earlier XME considered what is a retail back office and its software as well as why should sellers create a robust framework for their business activities? Today, the focus is on the question "How?"

How a novice retailer can build a back office in the right way and what should an experienced seller take into account. It's time to expand horizons.

A retailer's self-awareness is what helps it to make customers and employees joyful. It's hard to satisfy the first ones' needs without the harmonious work of the last ones. Therefore, both groups of people should be inspired by interaction with the company. Earlier, XME.digital considered what is retail back office and its systems as well as why merchants should create a robust frame for their business activities. Today, the focus is on the question "How?"

How a novice retailer can build a back office in the right way and what should an experienced seller take into account. It's time to expand horizons.

5 Golden Rules Helping You Create Cutting-Edge Retail Back Office Solutions

Rule #1. Consider business strategy, goals, and possibilities first

Following the US Retail National Federation, over 65% of merchants are ready to invest in new products. However, it's complicated to determine what a company needs: a multifunctional digital platform or cross-platform solutions, without researching the real state of software and its operation. So, strategy and goals analysis allow an understanding of where to start and what to focus on.

An opportunity assessment, in turn, helps determine how much a business can and will spend on its digitalization in the early development stage.

Rule #2. Don’t follow competitors

This area is one of the few where a decision has to be made based on the particular business features, regardless of other approaches used by competitors.

For instance, some retailers, like Kroger or Walmart, use ready-made retail back office systems for financial, logistics, and marketing areas. Others prefer a development from scratch. Each seller chooses a certain way, focusing solely on its needs for real-time logistic management, resource savings, information protection, etc.

Rule #3. Stay tuned for new products

Did you hear about 5G, Cloud, IoT, and other technologies? Yes, business must always consider weaknesses of its back office solutions and eliminate them with modern digital developments. It’s unreachable without the properly chosen architecture. Monolithic solutions can work efficiently, but they are significantly inferior in flexibility to microservices-based developments. We all need a tool for a Minimum Valuable Products (MVP) fast-coding to validate new ideas fast and exceed our customers needs and expectations.

Rule #4. Don’t write off staff

The software effectiveness directly depends on how often employees use it. How much time it’s needed to onboard new employees and get an up-to-date report for the right decisions? The answer to this question is vital in times of uncertainty and changes. Therefore, creating a software ecosystem with simple solutions with a convenient interface is necessary to decrease time spent. In the future, it will save time on employee training and speed up the onboarding process.

Rule #5. Customer Still First

Implementing new back office solutions, the retailer should consider how it will affect the customers. It's principal to improve a loyalty system and strive to meet demand when arising. Another part of a positive customer experience is a quick home delivery or always getting the favorite goods. Therefore, the digitalization of the logistics sector is equally important. Also, this business must be adaptable to new market conditions, demand changes, etc. The client becomes a regular, understanding that the retailer always gives him all needed. His Life Time Value (LTV) will grow, and retail will become more successful.

Back Office Systems in the Retail Industry: Trends

Trend 1. Development from scratch

The retail industry is so dynamic. Ready-made solutions from SAP, Microsoft, and Oracle are not always suitable since they assume a piece of dependence. Users cannot change the components themselves. They have to wait for a new software version. Merchants are increasingly hiring a dedicated IT-team or a contractor company that develops and supports the software for retail business to ensure adaptability.

Trend 2. Moving to the microservice architecture

This way gives retail the needed flexibility because of microservices features. Some solutions, developed on microservice-based architecture, can also integrate well with the monolithic part of the retail back office solutions, helping it interact efficiently.

Trend 3. Usage of Business Management and Business Rules Management Systems

Business Management System (BMS) is a set of programs that helps manage internal processes in a constantly changeable environment. Business Rules Management System (BRMS) is a database used to support and control company business rules performance.

These systems don't replace essential retail back office software. They make it effective. For example, BMS can change attributes of any procedure during its execution and then provides its updated version.

Both BMS and BRMS are pretty complicated for implementation since all the processes need to be well-designed first. But the primary advantage is that such systems can change system components without IT-specialists participation.

Trend 4. Omnichannel approach

Omnichannel is not a buzzword. It is a system approach to single customer experience across all possible touch points with your company with merged sales and marketing activities. It counts transitions between channels. It is hard to determine how to build an efficient back office omnichannel ecosystem. It requires retail ERP software changes, implementation of flexible digital solutions like order, or inventory management ones. Thus, omnichannel gradually initiates the full digital transformation of the retail back office and all business as a whole.

Summary

Today retail has gone far from its beginnings and has become an IT- business. It needs flexibility and adaptability to function effectively. Thus, all changes, which concern the back office, should be oriented towards this opportunity. Such factors as satisfying demand and increasing the goods turnover also matter.

If you want to build your retail back office solutions in the right way - drop us a line. XME.digital experts will apply their knowledge and expertise to accelerate your business development this way.

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