Case study
Problem
Super Retail Group (Super) (www.superretailgroup.com.au) is one of the largest recreational retailers in Australia, with annual sales of more than AU $ 2 billion. Its seven retail brands focus on automotive products, cycling products and sporting goods, which it sells through more than 600 stores in Australia and New Zealand.

Since 2005, Super has grown exponentially through a series of acquisitions. Although this growth has added sales volume and brand strength, it has also made the supply chain companies very complex. Historically, the company owned and operated each brand as a separate division. As a result, in 2011 Super managed seven different supply chains, which stretched from procurement in Asia to distribution in Australia and New Zealand. Adding to the complexity of managing the Super supply chain is broad geography, but sparsely populated in Australia.

Therefore, Super executives decided to invest more than AU $ 50 million in improving supply chains and inventory management during 2012-2015. The initiative includes centralizing different distribution centers, consolidating procurement in Asia, developing fulfillment online sales for home delivery, and strengthening relationships with key trading partners.

In essence, the company's main strategic initiative is to consolidate demand estimates and replenish various brands. As companies acquire other businesses and expand the scale of private-label products, demand planning becomes increasingly important. Companies need to manage waiting times related to procurement from Asia, as well as seasonal volatility and extreme promotions in their brands.
Super also adds goods (digital) that are softer, which have different demand patterns from hard goods (physical). As a result, retailers need forecasting and refilling models that can handle their geographical complexity, as well as calculating stock-keeping units (SKUs), and variations in demand across seven brands.

IT solution
To integrate demand planning and meeting needs and to increase customer focus across brands, Super implements software from JDA (www.jda.com) into its Retail Trade division.
Within 10 months, the system was operational, thanks to the rapid deployment in the JDA cloud. The company chose to launch software in a cloud environment to speed up its implementation and to minimize costs.
Implementing the system in the cloud allows Super Retail to include the cost of IT infrastructure. That is, the company incurred the cost of purchasing hardware (servers and storage), software (applications), and network capabilities.

Retailers understand that not all hardware and software expenditures are clear; instead, building IT infrastructure often involves hidden costs. For example, Super estimates that hosting its own software solution will cost a monthly fee of AU $ 20,000 per month with only electricity. In addition, Super does not have internal IT resources to implement software, or the capacity to grow enough IT teams to support new software.
Trials in the Leisure Retailing division initially included 400,000 SKUs. It was later expanded to accommodate 1.4 million SKUs. Because of the complexity of the product at Leisure Retailing, this division functions as an effective trial for a new system.
Because Australia is home to 68 targeted shark species - more than anywhere else in the world - Super sells a lot of different fishing lures, and she has to manage many specific product ranges on a regional basis.

Reference
Rainer, R. K., Prince, B., & Cegielski, C. (2016). Introduction to Information Systems (6th ed.). NJ: John Wiley & Sons Singapore Pte. Ltd.Page 353-354

Question:
1. Explain why Super Retail Group decided to use JDA software along its supply chain!
2. Why the Super Retail Group trial in the Leisure Retailing division?
3. Why does the Super Retail Group implement cloud-based solutions? Do you believe this is the right decision? Why or why not?

Answer rating: 100% (QA)

Explanation Super Retail Group decided to use JDA software along its supply chain to help it to inte... View the full answer