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Alliance Supermarket and Point-of-Sale System
A current paper is devoted to the analysis of the case study regarding Alliance Supermarket and a point-of-sale system (POS). It is necessary to examine the existing situation and make relevant proposals in relation to the improvement of its operation. In particular, it seems that the investigation of market demand may be improved, and the supermarket may be able to optimize its costs and profits.
The new system is very useful for the supermarket as it helps to properly replenish inventory as well as increase overall productivity. However, it seems that not all potential benefits of the POS system are used. Alliance Supermarkets try to forecast market demand on the basis of historical trends. Such a system is highly inefficient as the supermarkets are not able to adjust to rapid changes in demand. As all demand facts are analyzed together, the specific situation in a given supermarket is not taken into account. Therefore, some supermarkets may have excessive quantities of goods while others may experience shortages. However, as the results are analyzed together as well, it does not lead to any improvement in the process of decision making. Manufacturers always ask the supermarket to help them to target their customers and promote sales, but a current inefficient system of management and data analysis cannot help them in reaching this objective. It is a very negative aspect as it not only reduces the supermarkets potential profits, but also decreases its reputation as well.
Therefore, it seems that the large-scale reforms in the field of data analysis should be implemented. Moreover, the supermarket has the modern innovative system that allows obtaining very large volumes of information. The main issue is its correct analysis and interpretation. First of all, the supermarket should understand that the needs of each customer should be satisfied. It means that the use of statistical abstractions and generalizations should be minimized. The initial focus of market investigation should be shifted from the central office of Alliance Supermarket to the specific supermarkets. The management and experts of each supermarket should analyze the changes in market demand that are present in their area and be able to influence a variety and quantities of products that are available in their supermarket.
Thus, additional decentralization may be helpful in this respect. It is important to ensure that all supermarkets have in their disposal high-qualified personnel that are able to analyze data and effectively use modern technologies. Moreover, the analysis should include both technical and economic aspects (Pather-Elias, Davis, & Cohen, 2012). If the system of Alliance Supermarkets does not have the sufficient number of high-qualified experts in this field, additional HR strategy may be implemented.
If each supermarket implements its own strategy and market analysis, the needs of all customers may be understood. Each supermarket will be oriented on its segments and customers, and incorrect generalizations will be absent. However, the process of data analysis should not be mechanical, i.e. the historical trends should not be merely extrapolated in the future. The supermarkets experts should understand the needs of its consumers and their positive dynamics as a result of holidays, the season of the year, the general situation in the region, etc. It is also possible to use modeling of productivity in supermarkets (King & Park, 2004). However, it should be organized on the level of specific supermarkets rather than the system as a whole.
Additional information may help Alliance Supermarkets to reduce its costs and improve the quality of its services. This information may be related to the specific consumer patterns that exist in a given region and some key factors that affect them. For example, it is possible to determine the general trend of consumer demand for a given supermarket. Then, it is possible to clarify the obtained prognosis with the help of calculated correlations. In particular, it is possible to determine how the specific weather influences the quantities of products that can be bought. Additional factors that may influence consumer demand may include holidays, the season of the year, the level of competition, consumers expectations, etc.
In the process of transition to the new system, it is possible to introduce additional self-service technologies (Cho & Fiorito, 2010). It may allow to better understand consumers habits and preferences. Another aspect of cost optimization is energy usage (Arias, 2005). If the supermarket is able to forecast the correct amount of products that are needed by consumers, it may economize significant amounts of energy. Consequently, it will increase the amounts of net profits.
The correct use of modern technologies and the POS system creates additional opportunities for demand estimation. When this objective is reached, it is possible to optimize assortment and quantities of products that may be sold under existing prices (Kok & Fisher, 2007). Such optimization may encourage cooperation with manufacturers as the supermarket may be able to help them to target customers and promote sales. Therefore, an additional number of companies will be willing to cooperate with Alliance Supermarket and propose attractive terms of cooperation.
The new approach of obtaining information may be proposed. It relates to the creation of a large database where information will be collected in relation to each customer. Thus, it will be possible to examine his/her individual consumer habits. In this way, the supermarket may become much more consumer-oriented. The general effectiveness of marketing strategies may be increased as well.
All ethical and privacy considerations should be properly addressed. Additional controlling systems may be introduced in order to ensure that all privacy standards and regulations are fulfilled. In order to reach these objectives, the customers may be evaluated under specific numbers (and not under their names). Thus, neither the supermarkets managers nor external experts will have an opportunity to misuse the personal information of customers. Adequate addressing of privacy issues will lead to increase the supermarkets reputation as well.
It may be concluded that the POS system may contribute to higher operational standards and the supermarkets overall performance. However, some additional organizational reforms and decentralization are needed. The main centers of decision making should be shifted to specific supermarkets. The needs of each customer should be analyzed separately. On this basis, it will be possible to create adequate forecasts and maximize the supermarkets net profits.