1 SAP For Retail Overview

SAP for Retail
SAP Runs Real Time Retailing
SAP AG 2004 - Andreas Lueckler, Industry Business Unit Retail & Wholesale
Agenda SAP Retail Customer Best Practices in Retail mySAP ERP SAP R/3 Enterprise for Retail Evolution SAP for Retail Development Projects Future Store Initiative Outlook SDP Fashion
Agenda
SAP Retail Customer
Retail Customers 2003 compared to Dec 2002 Retail Customers Worldwide 1.696 (1367)
Europe/Middle East/Africa Americas Asia Pacific

M C13 TOTAL EM EA AM ERICAS APA Customers 1.696 1.221 268 207 Installations 3.736 2.438 688 593
1.221 (1024) 268 (225) 207 (184)

Live Install. 1.468 1.003 208 256 Systems 7.427 5.018 1.351 1.058
Merchandise Management Customers**369 (269)
Europe/Middle East/Africa Americas Asia Pacific
222 (188) 100 (52) 47 (29)
*Source: ISP/CIS reporting, not incl. are the customer types SAP internal, -partner, -hardware partner and -logo partner. **Including Staffworks customers
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Strong customer base worldwide

Grocery Health & Beauty
Convenience
Postal Services/ Telco

Fashion General Merchandiser
Catalogue Mail Order/ Internet Selling

Misc. Speciality Misc. Speciality

DIY/ Home Improvement Wholesale/ Cash&Carry/ Franchise Business
Home Furnishings
Go Lives 2003
Live with SAP Enterprise 4.7 Incl. Purchasing, Master Data, Logistics (incl. VMI)
Live with mySAP Retail Implementation time: 6 months
Upgrade to R/3 Enterprise Further GoLive with mySAP Retail in Italy, Roll-out to US in preparation Upgrade to SAP R/3 4.6C Project time 9 months Live with IS-Retail (3 pilot stores), FI/CO, Rel. 4.6c, 110 stores, 80,000 SKUs Live with mySAP Retail and Retail AFS, SD, MM, WM, QM, FI, CO, HR Live in 800 pilot stores (out of 15.000 stores/ partner agencies ). Project time: approx. 12 months
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Live with SAP Retail Enterprise

Go Live 2003
Moebel Pfister and Migros Aare upgrade to R/3 Enterprise
On September 1, 2003, Moebel Pfister, a leading furniture retailer, went live with SAP Enterprise. The customer has reported back a seamless project without any major project challenges. Moebel Pfisters operations were never impacted by the upgrade in any way. The fact that the project was completed six weeks ahead of schedule and 20% below budget while meeting all the project objectives was the icing on the cake. On October 12, Migros Aare, one of the ten cooperatives of the Migros GenossenschaftsBund, successfully went live with R/3 Enterprise (upgrade from 4.5B) for their "Fresh items/perishables platform" - dairy and agricultural products (vegetables, fruit and flowers) as well as meat. The scope included a total of 14,000 articles and 2,000 users. The project last just six months and despite challenges related to hardware replacement and the upgrade of the Oracle database as well as the operating system (Unix AIX), the project delivered tangible benefits: Generating the assortment list (HPR-Version) is now a matter of 30 minutes instead of 21 hours! The system is stable and the customer is happy. Planned next steps are the upgrade to R/3 Enterprise for the cooperatives Luzern and Zurich. After that, the bakery assortment will be included and the rollout of the fresh item/perishable assortment will continue to the French speaking region as well as to Migros' convenience stores.
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SAP R/3 Enterprise 2.0 Ramp-up customers
Ramp-up has started in December for Enterprise Extension Set 2.0
SPAR Management AG, Switzerland Ramp-up has started last week for Enterprise Extension Set 2.0
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Agenda
Best Practices in Retail
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Segmentation of the Retail Industry
Best Practices Best Practices for for SAP for Retail SAP for Retail Standardization of Standardization of Retail Enterprises Retail Enterprises into four into four main segments main segments
Fashion Fashion
e.g. textiles, fashion, shoes
Hard Goods Hard Goods
e.g. do-it-yourself, electrical, toys, sport equipment e.g. supermarket, discount store, convenience store, hypermarket, cash&carry e.g. supplying wholesale, Internet, mail-order
Food Food
Preconfigured Preconfigured Systems Systems
Wholesale Wholesale
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What are SAP Best Practices for Retail?

Traditional project
With SAP Best Practices
Enable fast and easy Enable fast and easy Working CRM prototype implementation of SAP for Retail implementation of SAP for Retail Demonstration of a solution that Demonstration of a solution that is easy to: is easy to: identify with implement adapt to specific requirements Get a living and fully documented Get a living and fully documented prototype within days that you prototype within days that you can rapidly turn into a productive can rapidly turn into a productive solution solution
Time and effort savings
Identification and anticipation of reusable business processes and project activities

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Agenda
mySAP ERP
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What is mySAP ERP?

mySAP ERP is the successor ERP offering to SAP R/3 Enterprise Functionality-wise mySAP ERP:
Includes all the functionality of mySAP R/3 Enterprise Plus a large number of additional business processes (SAP SEM, ESS) Integrated and Personalized functionality (Business Information Warehouse reporting, role based)
R/3 R/3 Enterprise Enterprise
Technology-wise mySAP ERP:

Is built on SAP NetWeaver (From 2004) further integration with SAP NetWeaver (Enterprise Portal, Exchange Infrastructure and SAP BW)
mySAP ERP
SAP NetWeaver
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Retail-wise mySAP ERP

SAP R/3 Enterprise
The Retail Solution is included in SAP R/3 Enterprise, additional functionality has been developed in specific Retail Add-Ons (Enterprise Extension Set 1.10 and 2.0)
mySAP ERP 2004

The Retail Solution is included in mySAP ERP 2004, new functionality has been developed in specific Retail Add-On (SAP ECC Extension Set 5.00)
mySAP ERP 2005

The Retail Solution will be included in mySAP ERP 2005, new Retail functionality will be developed
General statement of direction

The core Retail functionality (merchandising solution) will remain part of ERP and will be further enhanced in the future (continuous improvement mainly) However, new Retail functionality will be developed also in other SAP components (SCM, MDM, CRM, etc.) and will be tightly integrated with ERP functionality
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The Architecture of mySAP ERP

Application
mySAP ERP Edition 2004 mySAP ERP Edition 2003
Additional Components
Self-Service Procurement Internet Sales and more
Additional Components
Self Services Self-Service Procurement Internet Sales Strategic Enterprise Management and more
Composite Applications SAP ERP Central Component 5.0

Self Services Strategic Enterprise Management
SAP R/3 Enterprise SAP R/3

up to 4.6C
SAP R/3 Enterprise SAP Enterprise Extension Set SAP R/3 Enterprise Core
SAP NetWeaver Composite Application Framework
PEOPLE INTEGRATION Multi Channel Access Portal Collaboration
Application SAP Basis
SAP Enterprise Extension Set SAP R/3 Enterprise Core SAP Web Application Server
SAP ECC Extension Set

Switch Framework
SAP ECC Core
SAP NetWeaver 2004 Composite Application Framework

PEOPLE INTEGRATION Multi Channel Access Portal Collaboration
Life Cycle Mgmt
Life Cycle Mgmt
INFORMATION INTEGRATION Bus. Intelligence Knowledge Mgmt Master Data Mgmt PROCESS INTEGRATION Business Integration Process Mgmt Broker APPLICATION PLATFORM J2EE ABAP DB and OS Abstraction
INFORMATION INTEGRATION Bus. Intelligence Knowledge Mgmt Master Data Mgmt PROCESS INTEGRATION Business Integration Process Mgmt Broker APPLICATION PLATFORM J2EE ABAP DB and OS Abstraction
Technology
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Release Strategy SAP R/3 and mySAP ERP

mySAP ERP Edition 2004
Other components (e.g. Self Service Procurement) Available with mySAP contracts only (e.g. mySAP ERP or mySAP Business Suite) SAP ERP Central Component 5.0
SAP ECC Extension Set 5.00 SAP ECC Core 5.0
SAP NetWeaver04
mySAP ERP Edition 2003

Other components (e.g. Self Service Procurement) SAP R/3 Enterprise
SAP R/3 Enterprise Extension Set 2.00 SAP R/3 Enterprise Extension Set 1.10 SAP R/3 Enterprise Core 4.7
SAP NetWeaver03 Available with SAP R/3 contract
SAP R/3 Enterprise

SAP R/3 Enterprise Extension Set 2.00 SAP R/3 Enterprise Extension Set 1.10 SAP R/3 Enterprise Core 4.7
SAP R/3 4.6C
2002
2003
2004
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2005
2006
2007
2008
2009
The Architecture of SAP R/3 Enterprise

SAP R/3 Enterprise SAP R/3 Enterprise Extension Set 1.10 + 2.00
Optional new functional enhancements
(SAP R/3 Enterprise Extension Sets)
With SAP R/3 Enterprise, SAP has introduced a new development strategy. Primary focus: making deployment of new functionality optional. Plus: stability of existing processes
SAP R/3 Enterprise Core 4.7
Tuned Core, optimized for Performance

(SAP R/3 Enterprise Core)
SAP Web AS 6.20 + 6.30
Technology & infrastructure enhancements

(SAP Web Application Server)
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The Architecture of SAP ERP Central Component 5.0

SAP ERP Central Component 5.0
Optional new functional enhancements
(SAP ECC Extension Sets)
SAP ECC Extension Set 5.00
Ongoing consolidation of additional industry add-ons into Extension Set layer
Traditional functionality as part of the SAP ECC Core

(SAP ECC Core 5.0)
SAP ECC Core 5.0
Optional enhancements on user interface for SAP Enterprise Portal
Latest SAP Web AS synchronized with SAP NetWeaver 04

(SAP Web AS 6.40)
SAP BW 3.5* SAP ITS**
SAP Web AS 6.40
Integrated SAP BW 3.5 and Internet Transaction Server
SAP ERP Central Component makes use of SAP NetWeaver capabilities

(such as existing and new functionality with direct support of SAP Enterprise Portal, reporting through integrated SAP BW)
* SAP BW 3.5 can be optionally deployed within the same instance ** SAP ITS (Internet Transaction Server) will be partly integrated in SAP Web AS 6.40
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Agenda
SAP R/3 Enterprise in Retail
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Retailers Landscape
Strategic Planning
Procurement
SCM
BI
CRM
Operative planning Merchandise Management

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Consumer
Sales
Vendor
SAP Business Warehouse: Architecture
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Knowledge Discovery / Data Mining Customer Groups

Subgroups e.g. Bargain hunters Regular customers Strategic customers C A e.g. Beer and Tooth Paste bought together on Thursday evenings shopping Algorithms
Buying Patterns
Companion Sales When? What? How?
B Consumers ballot paper
Direct marketing Target group specific assortments Marketing controlling
POS data Consumer data
Promotion Planning Shelf optimization Assortment planning
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BW Business Content for mySAP Retail Enterprise
Data Mining Integration Category Management Store Controlling Market Data RMA Integration Close the Loop MAP Integration Article Infosystem POS Data Management Campbell Integration Customer Relation
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Features of a flexible merchandise planning system I
Business Information Warehouse Document Management Complex Processes
Easy to use Multiple Key figures to plan

398 157 005
Different Currencies US $
SG $
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Features of a flexible merchandise planning system II

Planning versions Complex Hierarchies
B A
Value and unit planning
Flexible Input templates
Temporal dimensions
90 80 70 60 50 40 Jan Febr . Mrz Apr il
UM WE (UM-WE) / UM
1000 800 0,2
UMS 1000 2000 3000
WE 500 1400 2000
UMS-WE 500 600 1000
40 30 20 10 0
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Plan
Ist
Features of a flexible merchandise planning system III

Interfaces Authorizations
Workflow
Allocation table / Promotion
Store A Store A New Article

Special buy Special buy -20 % -20 %
Store B Store B
Article and Characteristic Planning

Prepack Allocation Planning

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Store Management with Enterprise Portals
BW Reporting SAP Retail Store
Workflow
Internet
SAP R/3 Retail Mobile Data Capture
POS Third Party
SAP R/3 HR
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Retail portal content: BP for Retail Retail Buyers Business benefit:

Provides single interface for data and information retrieved from several systems to support the buying process in a Retail company. The application focus of the first version is on the daily/yearly negotiation with suppliers. Future development phases plan to cover promotion planning, assortment control and additional procurement processes. Also suppliers should be allowed to access their data from outside.
Users can:
Define myEntities (Vendor, Sites) Manage daily vendor contacts Monitor Out-of-Stock situations & back orders
Roles:
Retail Buyer Stock Planner
Content systems:
SAP R/3 & Business Information Warehouse
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Retail portal content: BP for Retail Store Manager Business benefit:

Provides single interface for data from several systems to support retail processes, personnel management, and store controlling
Users can:
Support in-store promotions Manage staff and staff schedules Support pricing tasks Support purchase order process Support goods receipt and controlling processes
Roles:
Store Manager
Content systems:
SAP R/3 Retail & Business Information Warehouse
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SAP Retail Store - Architecture

IDoc/RFC
R/3 Enterprise
Dialog
Business Connector
XML
ITS
HTML
Business Connector
POSition
SAP-XML
SAP-XML
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SAP Retail Store Application Structure

LoginScreen
Main Menu
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Example: POS Inbound / Store Replenishment

Runtime Test: Data Volumes: 10,000 articles, 1,000 stores, 10 DCs System: 16 CPU Database server + 6 application servers (8 CPUs each)
Step 1: POS Inbound (1) with 130 parallel processes

100 million line items POS sales data (100,000 IDocs, aggregation ratio 10%)*
Runtime ca. 18 min ( more than 330 million line items / h)
*) 100 Idoc/store with 1000 line items each
Step 2:
Replenishment Calculation with 130 parallel processes
Check 10,000 articles per store, results in requirements for 20% of all articles
Runtime ca. 30 minutes
Step 3:
Creation of Follow-On documents with 100 parallel processes
Create 1 million order pos + 1 million delivery pos + 1 million transfer order positons
Runtime ca. 58 minutes
Total Runtime: approx. 105 minutes

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Planning Workbench - Process overview
Forecast Replenishment
Automatic Load Building
Automatic Creation Purchase Order
Purchase Order Creation manually
Planning Workbench
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Merchandise Distribution
Synchronized procurement and issue achieved by means of a fixed assignment Planning, monitoring, and control of the accelerated processing methods (crossdocking, flow-through) in the distribution center on the basis of this assignment Two phases:
Planning
Push Pull Goods Issue Goods Receipt
Processing
Cross-Docking Flow-through
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Returns in Retailing
Mail order return Return to vendor Retail return
External vendor
Consumers (identifiable or nonidentifiable customers)
Store
Return to vendor Store return
Return from customer Distribution center Wholesale Customer
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Store and Assortment Management in SAP for Retail

Merchandise Category Soft Drinks
Cola, Sparkling Water etc. Time Period
Merchandise Category Soft Drinks

Cola, Sparkling Water etc. Time Period
Assortment
Local assortment
Assortment Beverages
Local assortment
Assortment Beverages
02 03
Reference Store for Assortment

Automatically generated
Optional
System Required
Optional
Store Store A B C D
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Store
Store A
B C D
The Allocation Management Process
Head office Head office

Head office
plans plans Merchandise is procured and allocated
coordinates coordinates
monitors monitors
Vendor Vendor
Store Store Store Store Wholesale Store
Distribution center
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Allocation Strategies: e.g. Bottom-up Strategy (BW access) Example: I need to buy and allocate a basic article for three stores to support a 4 week merchandise roll-out. I expect the article will sell at about 110% the volume of a two week period (07/01/2003 07/14/2003) last year. I want to forecast the sales of this article leading up to the roll-out and subtract that quantity from the current stock level and open order quantities (by store). The stores must display a minimum of 100 pc at the beginning of the roll-out, but their maximum capacity is only 350 pc. Finally, I need to distribute the article to stores in multiples of 5 pc.
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The Promotion Management Process
Promotion final processing
Promotion planning
Carrying out the promotion Promotion subsequent processing
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Mark-Down Planning End of Season Process

Planning of markdowns
Select articles and sites Article (also based on characteristic value) Price phases Sales prices Markdown in % Quantities (planned sales quantity, stock remaining at end of season, ...) Calculate margins
Rel. price 80%
100%
50%
30%
Time
Markdown rule
Price activation
Generate condition records Update calculation
Sale of articles
Feedback from POS
Adapt markdown planning (where necessary)

Move price phases Increase markdown in %
Analysis of sales activity

Compare planned /actual sales Remaining stock Range of coverage
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Agenda
Evolution SAP for Retail
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Evolution SAP for Retail from 1.2B to R/3 Enterprise 2.0

Retail 1.2B
SAP R/3 Enterprise 1.10
Open mySAP.com integration Web Application Server 6.20 BADI (Business Add-Inn) Business Configuration Sets HPR fully integrated HPR Assortment List Store and Assortment Mgmt. New Mass Maintenance Tool Style (Variant) Matrix MAP enhanced function Prepack Allocation Planning Store Manager Portal SAP Retail Store PDC XML SAP Retail Store POS XML Markdown Pl.-enhanced function Allocation - enhanced function Allocation Strategy Promotion - enhanced function Replenishment Workbench enhancements Multi-Step Replenishment AHD / PDF in Replenishment Planned Delivery Time Order Cancellation Space Management - enhanced function Layout Workbench Merchandise Distribution enhanced function Logistics Execution System enhanced function TRM in LES Perishables enhanced function Global Trade Retail Method of Accounting Consumer Decision Tree mySAP ERP SAP NetWeaver SAP MAP (SEM) SAP Forecasting & Replenishment SAP POS Data Management SAP Profit Center Analytics SAP Customer Loyalty Marketing Portal Retail Business Packages Future Store Initiative Overlapping Promotions Promotion Delivery Phases Family Pricing Retail Revenue Mgmt. Interface Cross-Docking (considering DC Stock at Delivery Creation) Cross-Docking (Automatic Handling of Structured Articles) Stock Transfer for Consignment Authorities for Layout Workbench Allocation based on Shelves Communication of Placement Changes to the Stores Consistency Check of the Replenishment Master Data PRICAT Data Exchange with user specific fields & planned changes Complaints Processing in Billing IDoc Copy Management Modifications to Store Order BAPI Automatic Vendor Item Determination in Store GR Planned Delivery Time in Workdays VMI for Wholesale Customers Assign Invoice Items to PO and Site BADI for Rounding in Sales Orders Physical Inventory for Open Stores SRS Purchase Order & Returns SRS Ruling Prices SRS Order Rhythms
First Customer Shipment Retail Release 1.2B
General availability SAP Retail integrated in R/3 Standard Release 4.0 Worldwide Rollout
Mass Maintenance Value & Quota Scales Competitor Pricing Pricing enhanced function Layout & Space Management interfaces Additionals integration Allocation enhanced function Promotion enhanced function SAP Retail Store (SRS) Load Building Merchandise Distribution (Cross Docking & Flow Through) Vendor Managed Inventory (VMI) Store Returns Perishables SAP Online Store WM integration Agency Business RIS enhancements
Easy Access, Screen redesign Fast Entry High Performance Retail (HPR) Promotionenhanced function Bonus Buy Allocation enhanced function Markdown enhanced function Logistical Variants Product Catalog enhancement Competitor Pricing enhancem. Market Basket Pricing Replenishment Workbench Additionals improvements Merchandise Distribution enhanced function Perishablesenhanced function MAP (Merchandise & Assortment Planning) MAP integration to Promotions & Allocations BW Retail Templates Sales Order Optimization Layout & Space Management interface Optimization VMI enhancements Logistics Invoice Verification Subs.Settlem. enhan. function POS Inbound & Outbound Optimization Logistics Execution System enhanced function Handling Units Multi Channel Retailing
1997
1998
1999
2000
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2001
2002
2003
2004
Agenda
Development Projects
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Development Projects 2003 / 2004 / 2005

SAP Forecasting & Replenishment (SCM) SAP Merchandise and Assortment Planning (SEM) SAP Profit Center Analytics (BW) SAP POS Data Management (BW) SAP Customer Loyalty Marketing (BW) SAP Enterprise Portals (Store Portal, Buyers Portal) Future Store Initiative Fashion Processes SAP Retail Store Promotions Planning
New Development Projects: Point Solutions, Portals
40 % 40 % 20 %
Customer Projects: SDP Karstadt SCP EDEKA and COOP CH
Continuous Improvement: SAP R/3 Enterprise EE2.00
Master Data SAP Retail Store Promotions Pricing Merchandise Distribution etc.
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SAP Forecasting and Replenishment

SAP Forecasting and Replenishment
Master data Sales Stock DIF's Open Orders
Transfer Sales Data, Stock, DIF's, Open Orders, Master Data
Automatic Replenishment Quantity Calculation

Net Requirem.
Manual Replenishment
R/3 Retail / ERP

Replenishment Quantity Optimization
Exceptions Order Proposals
Exception Handling / Manual Release
OP f. manual proc.
Order Proposal Release Management

Released OP's Autom. Transfer Order Proposals into Orders Released Orders
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SAP Merchandise and Assortment Planning (SAP MAP)

SAP MAP Strategic Plan Store Plan Merchandise Plan
Total Planning Integration

Strategic planning Store planning Merchandise planning Assortment planning
Open Interfaces (XML)
Assortment Plan
Fulfillment Master Data Assortment Shelf Optimization Price Reduction Purchase Order Allocation
Total Execution Integration

Buying / OTB Allocations Assortments Space Optimization Master Data Management Markdowns
Business Scenarios
Fashion Basics / Lean Category Management
Out of Scope
Promotion Planning Campaign Management
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SAP MAP Slow Seller Management Minimize Markdowns while Ensuring Optimal Inventory Pre-season: Markdown Planning (Simulation)
Assign markdown profiles and sales patterns to products to simulate: When will the merchandise be sold? How large should each markdown be? What gross margin can I expect?
$35
29.99
In-season: Slow Seller Controlling

System evaluates pre-season plans versus actual performance to automatically propose price reductions based on the markdown profile.
Execution in the Merchandising System

Automatically update retail prices
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SAP POS Data Management
Sales Analyses of POS Data

BW-Reporting Templates
Store Contr.
Loss Prevent
Promo Analysis
SAP BW
mySAP Landscape POS Inbound Processing Engine

Outbound Interfaces
3rd Party Landscape
Upload of POS Data to SAP BW via POS Inbound Processing Engine

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Profit Center Analytics It is one Scenario which enhances and improves existing functionality by integrating SAP R/3 Enterprise, SAP BW and SEM. It is based on the store as a profit center and the cost center that is assigned to it Retail ledger in R/3, to replace the data storage for transaction data in EC-PCA. It guarantees efficient handling of big data volume, which is absolutely needed by storebased retailers. Content in SAP BW to increase the reporting functionalities for store managers as well as for management reporting Content in BW for SEM as well as planning layouts and reports in SEM to increase planning functionalities for managers.
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Customer Loyalty Marketing
Measure Results in BW Measure Results in BW
Customer applies for loyalty card Customer applies for loyalty card (store, phone, internet) (store, phone, internet)
Measure Results
Target groups are Target groups are assigned to assigned to campaigns in CRM campaigns in CRM and executed and executed
Submit card application
Execute Campaigns
Maintain Customer Master Data
Maintenance of Maintenance of Master data in CRM Master data in CRM and replication into and replication into BW BW (Application (Application template with template with customer attributes customer attributes delivers basis) delivers basis)
Segement & Build target group

Segment builder accesses Segment builder accesses sales data and creates sales data and creates target groups in CRM target groups in CRM
Sales at POS Upload of POS data To BW
Identify POS customer
Shopper buys at POS Shopper buys at POS with his/her preliminary with his/her preliminary card card (usually a paper version (usually a paper version of the genuine card )) of the genuine card
Once customer master data is available in Once customer master data is available in CRM system ,, matching of customers CRM system matching of customers sales transactions to master data is sales transactions to master data is possible. possible.
Upload of POS sales Upload of POS sales transactions into BW Data transactions into BW Data warehouse warehouse
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Agenda
Future Store Initiative
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Intention of SAP within the FSI Research project on learning how to use RFID technology Target: Get a pilot store live with leading edge technology
RFID on pallet level, case level, for all dry goods RFID on item level for selected articles (CDs, DVDs [theft protection], smart-shelf)
Learn about requirements, benefits and process scenarios coming from RFID in a live environment SAP to achieve leadership position for RFID related software in Retail and Consumer Products
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RFID - Radio Frequency Identification Key enabling technology for Smart Items RFID is an automated identification and data collection technology, leading to accelerated business processes and more accurate and timely data entry. RFID tags consist of a chip for holding data and an antenna for communicating the data through radio waves.
Controller Interrogator (aka Reader/Scanner) Tag/Transponder
Network
Tag Antenna
Reader API
Air Interface
Many types of tags and readers exist today, i.e. active and passive, read / write, various frequencies etc
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RFID Advantages and Business Benefits

Advantages: Uniquely identifies every physical object Unsupervised identification
Any orientation No line of sight required
Business Benefits: Transparency along the Supply Chain within tracking of all objects Optimized visibility of the goods flow Minimizing the human resource factor within automatically identification of all goods movements
Multiple read
Anti-collision
Harsh environments Read & Write capability

Dynamic Information Reuse
Amount of data
RFID increases quality, timeliness and depth of information

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RFID Processes in Goods Transport and Delivery
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RFID Processes in Warehousing and Frontstore
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Agenda
Outlook - Strategic Development Project Fashion
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Product Fit for 2004 / 2005 - Case Study

SAP R/3 Enterprise 4.70 SAP R/3 Enterprise 4.70
Transactions, controlling, master data management Store group definition Capacity data maintenance Purchase order Markdown control Allocation table Level/capacity type Fixture OTB POS data
PIPE
POS Inbound Processing Engine POS analyses
Planning, reporting, analytical applications
SAP BW 4.0 SAP BW 4.0
SEM BPS
Retail planning OTB Capacity planning Fixture Theme structure
Retraction
Sales info
Analyses for ERP Relevant data
A matrix Allocation strategy Planned articles, OTB, listing information
Theme structure
Planned article
Assortment planning
Extraction
Articles, merchandise categories, SGs, assortments, promos, conditions, theme structure, fixtures, article list
Analyses for F&R Relevant data Transaction data
Addons
Master data, transactions Exceptions
Markdown matrix application A matrix
Actual/ plan data (multidim)
Master data Master data Order proposals Allocation proposals
SCEM
F&R Engine
replenishment process
SAP SCM 4.0 SAP SCM 4.0
SAP CRM > 4.0 SAP CRM > 4.0

Campaigns, promotion planning
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Primarily Requirements
Master data Master data
Article maintenance and selection on Article maintenance and selection on characteristic level characteristic level Article work list for all processes Article work list for all processes Prepacks Prepacks Handling of approx. 6.5 million skus Handling of approx. 6.5 million skus Handling of 200 Department Stores Handling of 200 Department Stores Handling of more than 20.000 departments Handling of more than 20.000 departments
Dr aft
Purchasing Purchasing
Order entry (fast order entry) Order entry (fast order entry) Delivery period (tracking) Delivery period (tracking)
Ve rsi on
Bestseller-/Slow seller management Bestseller-/Slow seller management

Mark-down management Mark-down management
Allocation Allocation
Flexible and short dated allocation Flexible and short dated allocation
Planning & Analysis Planning & Analysis

Assortment planning Assortment planning Rack and shelf planning Rack and shelf planning Closed loop Closed loop Analysis and reporting Analysis and reporting OTB OTB
Invoice verification Invoice verification

Mass maintenance Mass maintenance Payment before shipment Payment before shipment
Vendor-Management Vendor-Management Replenishment Replenishment

Never-out-of-stock (NOS) Never-out-of-stock (NOS) Integration of events Integration of events Capacity check (on shelf level) Capacity check (on shelf level) End-of-season monitoring End-of-season monitoring
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Vendor score card Vendor score card
Processes and challenges for SAP

Top-Down Planning
order Splitting / Open-To-Buy (OTB) Planning
Subsequent settlement Vendor management

vendor sanctioning vendor evaluation
Dr aft
Ve rsi on
Assortment Planning
fashion basics theme structure store grouping capacity planning assortment planning
Master data
article hierarchy store concept article list substitute & replacement styles
Order Generation
fast-order entry simplified Master Data Maintenance OTB generation order controlling (tracking)
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Allocation
pre-allocation (long term view) new-allocation (near goods receipt)
Auto replenishment (NOS) Best / Slow seller management

mark-down planning
Outlook - Collaborative Master Data Management (cMDM)

collaborative Master Data Management
Enterprise Portal
cMDM Advanced Technology Architecture
Business Information Warehouse
Master Data Server mySAP ... R/3 Enterprise non SAP System non SAP System
Object Layer
Service Layer
Provisioning Layer
cMDM Adapter
cMDM Adapter
cMDM Adapter
cMDM Adapter
Content Integrator
Exchange Infrastructure
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Outlook - MDM for Retail development topics

Data Model Preparation 1.
Ensuring of Retail Data Model. Protection of a future Retail project.
Single Article/ SKU 2.

Central maintenance and single distribution
Generic Article/SKU, Set Lot Display 3.

Central Maintenance and distribution
Col. Scenarios, Duplicate check 4.

Retail Sites, Organizational depended MD 5.

Purchasing/ Customer Info record 6.

Assortment, Listing 7.
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Scope for MDM 3.1 Ramp up is planned in August 2005
k n a h T
u o
SAP for Retail
SAP Runs Real Time Retailing
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Sources of Information on SAP for Retail (I) SAP R/3 Enterprise and ERP Information Center: http://service.sap.com/enterprise Information on SAP for Retail: (Retail Service Marketplace) http://service.sap.com/retail Information on the new release and delivery strategy of mySAP.com: http://service.sap.com/releasestrategy SAP Help Portal: http://help.sap.com SAP Enterprise Portal: http://help.sap.com Enterprise Portal SAP NetWeaver mySAP
SAP NetWeaver (Technology): (SAP Service Marketplace) http://service.sap.com/netweaver or http://help.sap.com SAP NetWeaver
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Sources of Information on SAP for Retail (II) Retail Performance Map: http://service.sap.com/performancemap Information on the ramp-up process for bringing SAP solutions to market: http://service.sap.com/rampup SAP System Landscape Directory, description of mySAP.com system landscapes: http://service.sap.com/landscape Platform and Technology Information Center: http://service.sap.com/platforms Information on upgrade, e.g. upgrade services, tools and technology: http://service.sap.com/upgrade Global Trade: http://www.service.sap.com/globaltrade
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Sources of Information on SAP for Retail (III) Information on the changed maintenance strategy, e.g. extensions: http://service.sap.com/MaintenanceStrategy Information on SAP R/3 Interfaces: http://service.sap.com/r3-plug-in Category Management: http://service.sap.com/retail SAP for Retail in Detail Category Management Education: http://www.sap-retail.de/education SAP Retail Homepage: http://www.sap.com/retail SAP Retail Solutions: http://www.sap-retail.de Accessibility: http://www.saplabs.com/accessibility
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Sources of Information on SAP for Retail (IV) Information on Space Management Integration: http://www.sap-si.com services industry solutions retail category_management Information on mySAP ERP: http://service.sap.com/erp Information on Ramp-up Knowledge Transfer (RKT) http://service.sap.com/rkt
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Momentum
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SAP and Karstadt / Quelle AG
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Success Story Metro Cash & Carry

METRO CASH & CARRY INTERNATIONAL GMBH mySAP HUMAN RESOURCES IMPLEMENTATION HELPS METRO MANAGE RETAIL ACTIVITIES WORLDWIDE
With its Metro Cash & Carry stores, which are managed under the brand names Metro and Makro, the Metro Group remains the international market leader in selfservice wholesaling. A benchmark analysis performed by SAP Business Consulting showed that, by implementing mySAP Human Resources throughout its network of stores, the group would experience significant savings and benefits.
Once consolidated and processed, the quantitative and qualitative key figures provided a transparent picture of the operative and strategic potential per application area and for the company overall. Ute Riemann Head of Benchmark Project for MCC.
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Success Story Swiss Post

SCHWEIZERISCHE POST (SWISS POST) IMPLEMENTS mySAP RETAIL TO TRANSFORM 3,300 POST OFFICES INTO RETAIL OUTLETS
Swiss Post turned to mySAP Retail to manage the sales of 4,000 articles across 3,300 post offices. Sales information like article, post office code, quantity sold, and sales price flows from the individual POS systems into mySAP Retail every evening. This enables Swiss Post to replenish stock and analyze sales to determine what is selling, how much inventory needs to be replenished, and how profitable its operations are. With mySAP Retail, we are getting information much faster and at a higher level of detail. The successful implementation will enable us to have a high level of transparency with our sales data. This will help us to quickly react to new customer requirements.
Christian Oberschartner, Project Manager, Swiss Post
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Copyright 2004 SAP AG. All Rights Reserved

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1 SAP For Retail Overview

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SAP for Retail

SAP Runs Real Time Retailing

SAP Retail Customer

Europe/Middle East/Africa Americas Asia Pacific

1.221 (1024) 268 (225) 207 (184)

Merchandise Management Customers**369 (269)

Europe/Middle East/Africa Americas Asia Pacific

222 (188) 100 (52) 47 (29)

Strong customer base worldwide

Postal Services/ Telco

Strong customer base worldwide

Catalogue Mail Order/ Internet Selling

Strong customer base worldwide

Strong customer base worldwide

Live with mySAP Retail Implementation time: 6 months

Live with SAP Retail Enterprise

SAP R/3 Enterprise 2.0 Ramp-up customers

Ramp-up has started in December for Enterprise Extension Set 2.0

Best Practices in Retail

Segmentation of the Retail Industry

e.g. textiles, fashion, shoes

Hard Goods Hard Goods

Preconfigured Preconfigured Systems Systems

What are SAP Best Practices for Retail?

With SAP Best Practices

Time and effort savings

Identification and anticipation of reusable business processes and project activities

What is mySAP ERP?

Technology-wise mySAP ERP:

Retail-wise mySAP ERP

mySAP ERP 2004

mySAP ERP 2005

General statement of direction

The Architecture of mySAP ERP

Composite Applications SAP ERP Central Component 5.0

SAP R/3 Enterprise SAP R/3

Application SAP Basis

SAP ECC Extension Set

SAP ECC Core

SAP NetWeaver 2004 Composite Application Framework

Life Cycle Mgmt

Life Cycle Mgmt

Release Strategy SAP R/3 and mySAP ERP

mySAP ERP Edition 2003

SAP NetWeaver03 Available with SAP R/3 contract

SAP R/3 Enterprise

SAP R/3 4.6C

The Architecture of SAP R/3 Enterprise

SAP R/3 Enterprise Core 4.7

Tuned Core, optimized for Performance

SAP Web AS 6.20 + 6.30

Technology & infrastructure enhancements

The Architecture of SAP ERP Central Component 5.0

SAP ECC Extension Set 5.00

Ongoing consolidation of additional industry add-ons into Extension Set layer

Traditional functionality as part of the SAP ECC Core

SAP ECC Core 5.0

Optional enhancements on user interface for SAP Enterprise Portal

Latest SAP Web AS synchronized with SAP NetWeaver 04

SAP BW 3.5* SAP ITS**

SAP Web AS 6.40

Integrated SAP BW 3.5 and Internet Transaction Server