Unleasing the Potential of Retail Through Wireless Technology

In the crazy world of commerce, few businesses are as predictably unpredictable as retail apparel. In this industry, retailers need to understand their customers intimately and make available clothing that matches the fashion of the time every time. Failure to do so is not only a blow to the brand but might severely impact the business' profitability and future viability as excess inventory will have to be sold at scrap value. Nowhere is creativity and innovation more closely intertwined than in the fickle world of fashion.

Such was the challenge for PEPPO Fashions Group, an apparel distributor in Thailand, which manages labels such as Guess, Guess Baby/Kids, Guess Accessory Stores, Mango, Marciano and Castro. It has 12 standalone retail outlets and presence in 50 department store consignments in the country.

Operational nightmare

According to Palakorn Khisalang, IT Manager for the Group, department stores constantly refresh their layouts, and require tenants like PEPPO to move within the building several times a year.

"It's a time-consuming and costly exercise for us to re-architect our IT network after each move," Khisalang says. "Moreover, department stores often run promotional bazaars at central locations, making it difficult for our staff to conduct customer transactions away from their regular in-store counter. This in turn causes discrepancies between the actual transactions conducted and the receipts that were generated."

As the Group expands, managing the IT operations based on a distributed architecture introduced significant network latency and became prohibitively challenging for a small team. This has a negative impact on the efficient collection of accurate sales data and thus hindered management's running crucial sales analysis.

"Our staff needed to be able to get real time updates on stock availability from our back-end warehouses and head office in Bangkok. Although we had moved from a manual system to bar-coding, we still needed a solution that would allow the staff to register inventory while on the move, instead of having to return to a central computer terminal to enter data," Khisalang explains.

Re-architecting IT around the business process

The company evaluated a number of solutions including deploying GPS and ISDN to ensure access to a single repository of data containing retail sales, inventory at the warehouse, and in-transit movement of goods. Each proposal failed on either cost or effectiveness.

One solution that appeared viable, however, was to introduce wireless technology at the retail sites and at the warehouses. The plan is for retail outlets to be equipped with thin client laptops and sales operators with wireless PDAs. This would allow staff to easily move around within the store, and between stores as well.

A centralized delivery mechanism for all applications was also deemed critical for the overall solution to work. The company evaluated a number of technologies and chose the Presentation Server from Citrix.

The Citrix Presentation Server centralizes the delivery of all the client applications the staff need -- such as Microsoft Excel to run sales projections -- without having to physically install these applications onto each device. The staff in turn can access multiple applications from any location.

"We enlisted the help of a Citrix Solution Advisor to implement the Citrix Presentation Server 4, with Microsoft Windows Server 2003 running on two HP ProLiant servers in the firm's data center in Bangkok," says Khisalang.

At the warehouses, the company used SYMBOL handheld devices to conduct inventory checks online via Citrix, with security over the network provided using a VPN combined with a two-factor authentication procedure comprising an RSA SecurID token and password.

Citrix was used to optimize inventory management process. As the access infrastructure foundation, Citrix Presentation Server provides staff with real-time access to a proprietary ERP solution called "PEPPOS" that is customized for retail management via PCs and wirelessly over PDAs. As goods move in and out of the warehouses, the bar code attached to each item is scanned, allowing the staff to track inventory movement. Previously, they had to walk to a LAN terminal to manually enter the data.

The new wireless solution resulted in a more efficient model for keeping track of inventory back at the warehouses, with front-line sales staff now having online access to the most updated information from virtually any machine in a secure manner.

"All of these factors played a strong part in our decision to deploy the Citrix solution to enable a mobile and wireless enterprise, and we believe that this innovative application of technology has enabled us to build a highly adaptable retail model," adds Khisalang.

Part of the initial requirement in the choice of technology was the concern of user training. With only four members in the IT team, PEPPO needed a solution that would require minimal training for everyone involved in the use of the new mobile devices. PEPPO put considerable effort in identifying the right combination of hardware and software to effectively mobilize its staff and ensure safe and efficient access to company information.

PEPPO, however, still faces a number of business process and technical challenges to realize the full potential of wireless technology across the entire operations. From a business perspective, enabling a wireless IT infrastructure isn't immediately possible across all of its locations because of constraints imposed by department stores. Even where possible, it can sometimes take a few months to finalize negotiation with the management.

Benefits gained through centralized delivery model

By centralizing application delivery and management on Citrix servers, and providing virtualized application access on PDAs, PEPPO is able to more easily handle department store counter relocations and periodic sales from central bazaars without having to reinstall point of sale terminals and other equipment, which saves time and money. At the same time, productivity for retail staff has improved because they no longer need to walk to and from fixed terminals to capture the data. Similar productivity improvements have also been observed at warehouses using real-time inventory tracking.

Centralized management has enabled PEPPO to keep IT headcount at four people, despite a significant increase in the number of stores and IT users. What used to take two weeks to install or upgrade software company-wide now takes only one hour.

"With the Citrix Presentation Server solution, we have been able to provide approximately 340 staff at 50 different locations throughout Thailand with secure remote access to critical business applications wirelessly via a 128 kbps ISDN connection from PDAs over a 802.11b/g WLAN interface," beams Khisalang. These applications include Microsoft Office 2003, Oracle Database 10g, and PEPPOS.

Low-bandwidth printing has also been critical to business productivity at both the back-end and retail fronts. Accountants can remotely print the day's transactions from the head office. Warehouse assistants can now generate delivery notes, invoices, consignment notes and price tags wirelessly as well. "We can now literally link data to a retail outlet anywhere in Thailand or the world overnight, unencumbered by the typical technology hurdles that other companies face," adds Khisalang.

Surprisingly, the new solution has resulted in a significant downgrade in the bandwidth requirements of PEPPO. The company uses a 128 Kbps connection at each location back to the Citrix Servers at head office. Conventional technology would have necessitated a 512 Kbps or 1MB bandwidth demand. PEPPO estimates that it was able to save up to $1,600 in bandwidth costs per location alone.

"I recently attended a retail conference in Bangkok, where the focus was on how IT can be used as an enabler for retail enterprises. Some of the technologies mentioned were the ones PEPPO have used several years ago. Many have yet to integrate these with wireless technology. I think companies in the retail industry stand to benefit from these technologies," concludes Khisalang. " Now that we have found the right formula to enable a mobile enterprise, we will continue to establish wireless infrastructure in our new stores as we expand our presence in Thailand."