Tag: Deloitte

How shopping is changing in a digital world

Shopping: love it or loathe it, a wave of innovation is heading this way – and it promises to make a visit to your local mall a far more productive and pleasant experience.

Deloitte is at the forefront of this trend with the creation of a Connected Retail Experience at its Deloitte Greenhouse innovation hub in Cape Town.

Shorter queues at checkout, a much better selection of goods, personalised, relevant special offers and the ability to have out-of-stock items delivered to your door within 24 hours. These are just a sample of the innovations coming to the South African retail sector that promise to make your shopping experience a whole lot more enjoyable and engaging.

That’s according to Corniel van Niekerk, senior manager at Deloitte, the professional services firm which is emerging as one of the key players bringing what’s known as ‘Connected Retail’ to South Africa.

“It’s an exciting time for consumers and retailers alike. Connected Retail technologies will not only make for a vastly improved shopping experience for customers, but retailers and suppliers who embrace and implement them effectively will see a significant boost to their bottom line. In this sense it’s a genuine win-win situation,” says Corniel.

So how could such a Connected Retail experience play out for you as a shopper? It may begin well before a visit to the store with an email, instant message or app notification about a product you’re actually interested in, rather than annoying spam about stuff with no relevance to you.

You may, for example, have a dinner party coming up at the weekend and get a discount voucher on a hard-to-find ingredient for that recipe you bookmarked in the store’s smartphone app last week which has now come into season and just arrived at the store.

Once you go to the store, the personalised experience continues. After you put the ingredients for that recipe into your basket and approach the wine section, you get a notification alerting you to a Pinot Noir that’s not only on promotion but will pair perfectly with the wild mushroom risotto you’ve planning to serve your guests.

Another innovation called ‘endless aisles’ will allow you to buy items currently out of stock or not usually stocked at the store, like a garment or shoes in a less common size or colour, and have it delivered to your home within a day or two.

And leaving with your purchases promises to be a more streamlined affair thanks to technology that lets stores better monitor customer flows and allocate staff to till points more quickly when demand increases – one element of the Connected Workforce which will empower and incentivise staff with technologies like gamification.

Self-service checkouts – which are currently being trialled by a major retailer at one of its Cape Town stores – promise, if properly implemented, to make for another quicker and easier checkout option for customers.

“The coming Connected Retail revolution will combine the best aspects of the online and bricks and mortar shopping experience, making for happier, more loyal customers who spend more at the store,” says Corniel.

But for this to happen will require looking beyond the Connected Customer, Connected Store and Connected Workforce, and bringing a series of technologies and innovations to the entire retail value chain.

The Connected Supplier will use embedded sensors and advanced analytics to prevent unscheduled asset downtime, increase labour productivity and synchronise or integrate activities, while the Connected Supply Chain will employ advanced computational techniques to forecast disruptions, reduce shortages, optimise warehouse collection and delivery slots and pro-actively manage advanced chains to reduce waste and theft.

Digitalisation and the store of the future have been topics of discussion in various forums, but at Deloitte, we believe it’s now time to make the concept real for the clients in our market and link business value to practical solutions,” says Corniel.

To this end, the firm recently strengthened its South African retail team with the addition of a number of individuals with extensive expertise in the international and domestic retail sectors.

It has also established a physical Connected Retail Experience at its Deloitte Greenhouse innovation hub in Cape Town. This immersive, interactive experience allows visitors to gain practical, tangible insights into every aspect of the Connected Retail ecosystem, sampling proven solutions alongside brand new technology relevant to each of the touch points: consumer, store, workforce, supplier and supply chain.

“It’s part of Deloitte’s new focus on ‘show not tell’ and we’re confident it will give our retail sector clients a significant advantage over their competitors as they position themselves to avoid the pitfalls and capitalise on the enormous opportunities offered by the Connected Retail wave,” concludes Corniel.

South Africa’s largest retailers

As retailers in South Africa look to support the economy through turbulent times, five of the country’s top retailers feature in global professional services firm Deloitte’s ranking of the 250 biggest retail groups in the world. Pre-scandal Steinhoff is the highest on the list, while Shoprite and Spar also feature.

Few sectors offer reliability at the moment in the South African economy. Although the country is the second richest in Africa behind only Nigeria, and is endowed with economically promising demographic trends, the last few years have represented a slump in economic growth, resulting from a severe dip in global oil prices in 2015.

Most sectors of the economy have been struggling since, including the ever-lucrative mining industry, which has suffered from a plummeting of prices and a spike in costs. However, amid this struggle, one sector that appears to be on the mend is the retail sector, which had its own mini-crisis in 2016, but has since recovered strongly with growth of almost 5% annually.

Now, a report from Big Four accounting and advisory firm Deloitte has revealed the primary drivers of growth in the sector. The report, which ranked the 250 biggest retailers in the world, featured five of South Africa’s major retail groups.

Top five retailers in South Africa

The highest-ranking South African retailer on the list was Steinhoff International at 68th on the global list. The firm was founded by Bruno Steinhoff in 1964 in the town of Stellenbosch in South Africa. Today, Steinhoff International operates in 31 countries, and recorded retail revenues of nearly $13.6 billion in 2016. In 2017, the firm went on an expansion drive, acquiring five firms, including Mattress Firm in the US and Poundland in the UK.

However, since Deloitte conducted its research, the firm has been shrouded in scandal, as sustained irregularities were found in the firm’s accounts for the last few years, forcing the resignation of its CEO and causing an 80% collapse in its shares. Steinhoff’s ranking may, therefore, be affected in retrospect.

The largest retailers in South Africa

The second-highest South African retailer on the list was Shoprite at 94th, with operations stretching across 15 countries, and retail revenues of just over $10 billion in 2016. The firm was founded four decades ago in 1979, and has since grown to employ 144,000 people across its international operations. Alongside the Johannesburg stock exchange, Shoprite also has secondary listings on the Namibian as well as the Zambian stock exchanges.

The SPAR Group of South Africa was next on the list, at 156th, operating across 11 countries and closing fiscal 2016 with just over $6 billion in revenues. The group began operations in 1963, when eight wholesalers were handed exclusive rights to the SPAR brand, which they utilised to supply 500 small retailers. The group now works out of six distribution centres and supplies to more than 1000 SPAR stores across South Africa.

In fourth for the South African list, and 156th in the global ranking is Pick n Pay Stores, with seven countries of operation and revenues of nearly $5.5 billion in 2016. Founded in Cape Town in 1967, the firm now employs approximately 50,000 people worldwide, and stretches across the African continent with operations in Botswana, Mozambique, Zambia, Namibia, and others.

Woolworths of South Africa rounded out the South African presence on the list, with operations in 14 countries and revenues just short of $5 billion. The Cape-Town-based retailer, which was founded as early as 1931, has achieved an impressive compounded annual growth rate of 18.9% since 2011.

Global leaders
Meanwhile, the list of leading retailers across the world had some predictable names on it, with Wal-Mart Stores leading by an enormous margin, followed by another US-based retailer, Costco, in second.

Source: Supermarket & Retailer

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My Office News Ⓒ 2017 - Designed by A Collective


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