Client
Sears Canada
On the Web
www.sears.ca Project
Assortment and Store Space Optimization
Shorcut to
Business Challenge
How Accenture Helped
High Performance Delivered Executive Summary
Accenture helped Sears Canada leverage technology to better
align resource allocation with performance, resulting in increased sales.
Business
Challenge Sears Canada, the largest full-line department
store in the country (116 stores), has recently enjoyed strong business
performance—more than $6 billion (CDN) in annual sales. But Sears Canada was
pressed to continue delivering significant revenue and earnings growth. The company had a strong core application architecture, but had been saddled with
legacy systems that were increasingly difficult to maintain, inflexible in
supporting data reporting needs, and underdeveloped in the area of
merchandising analytics. This placed escalating pressure on work teams to
support the current and projected growth rates.
How Accenture Helped With Accenture, Sears Canada embarked on the
Merchandise Systems Plan initiative to equip managers with the tools they
needed to grow and be more productive. Partnering with Sears Canada, we first
installed Retek's data warehouse and stock ledger as the infrastructure to
support three value creation initiatives: Assortment Optimization, Local Market
Tailoring and Store Space Optimization. The value of this implementation came
from aligning resource allocation (space, inventory, advertising) with
performance, facilitated by the merchandise data warehouse. This provided work
teams with the tools they needed and the additional time to spend on growth
initiatives.
High Performance
Delivered Accenture is now delivering on the other value initiatives. With the Assortment Optimization effort, we are developing
processes, tools and capabilities to identify "core" items—those meeting either
value-focused or customer-focused goals—to be merchandised in all assortments for a given line.
In Local Market Tailoring, we're building the capabilities to maximize what lay beyond the "core." Data mining technology is applied both
to create store clusters and to analyze item attributes to determine customer
likes and dislikes across both national and local items.
Finally, Accenture is helping optimize retail floor space
decisions at the department and line level. This includes communication between
the buying teams and the stores, and the development of tools for retail marketing managers to analyze space change decisions.
Through the Merchandise Systems Plan initiative, Sears
Canada is realizing the following:
- 1.5 percent increase in sales attributed to the
data warehouse and stock ledger with a project Internal Rate of Return (IRR) of
15.15 percent.
- Projected increase of $68 million in sales associated with Assortment Optimization and Local Market
Tailoring.
- Projected increase of $105 million
in sales associated with Store Space Optimization.
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