Course Code: BRL–015
Course Title: IT Application in Retail
Assignment Code: BRL–15/TMA/2014-15
Coverage: All Blocks
Maximum Marks: 100
Attempt all the questions
(A) Short Type Questions
Q1. Point-of-Sale (POS) is the physical location where goods are sold to customer. Elucidate.
Solution:-
Point of sale systems in the retail businesses improves productivity, but only if the right one is purchased. Making the wrong purchase in POS systems can be counterproductive.
The POS systems are today systems that are set up at every retail and hospitality outlet so that the sales are done faster.
It helps you with credit card transactions
Your cash counter and you order desk works automatically
Many retail POS systems include an accounting interface
Point of Sale (POS) System
Definition: A computerized network operated by a main computer and linked to several checkout terminals
Inventory software programs now on the market let you track usage, monitor changes in unit dollar costs, calculate when you need to reorder, and analyze inventory levels on an item-by-item basis. You can even control inventory right at the cash register with point-of-sale (POS) software systems. POS software records each sale when it happens, so your inventory records are always up-to-date. Better still, you get much more information about the sale than you could gather with a manual system. By running reports based on this information, you can make better decisions about ordering and merchandising.
With a POS system:
- You can analyze sales data, figure out how well all the items on your shelves sell, and adjust purchasing levels accordingly.
- You can maintain a sales history to help adjust your buying decisions for seasonal purchasing trends.
- You can improve pricing accuracy by integrating bar-code scanners and credit card authorization ability with the POS system.
There are plenty of popular POS software systems that enable you to use add-on devices at your checkout stations, including electronic cash drawers, bar-code scanners, credit card readers, and receipt or invoice printers. POS packages frequently come with integrated accounting modules, including general ledger, accounts receivable, accounts payable, purchasing, and inventory control systems. In essence, a POS system is an all-in-one way to keep track of your business’s cash flow.
Features to consider in a POS system include the following:
Ease of use. Look for software with a user-friendly graphical interface.
Entry of sales information. Most systems allow you to enter inventory codes either manually or automatically via a bar-code scanner. Once the inventory code is entered, the systems call up the standard or sales price, compute the price at multiple quantities and provide a running total. Many systems make it easy to enter sales manually when needed by letting you search for inventory codes based on a partial merchandise number, description, manufacturing code or vendor.
Pricing. POS systems generally offer a variety of ways to keep track of pricing, including add-on amounts, percentage of cost, margin percentage and custom formulas. For example, if you provide volume discounts, you can set up multiple prices for each item.
Updating product information. Once a sale is entered, these systems automatically update inventory and accounts receivable records.
Sales tracking options. Different businesses get paid in different ways. For example, repair or service shops often keep invoices open until the work is completed, so they need a system that allows them to put sales on hold. If you sell expensive goods and allow installment purchases, you might appreciate a loan calculator that tabulates monthly payments. And if you offer rent-to-own items, you’ll want a system that can handle rentals as well as sales.
Security. In retail, it’s important to keep tight control over cash receipts to prevent theft. Most of these systems provide audit trails so you can trace any problems.
Taxes. Many POS systems can support numerous tax rates-useful if you run a mail order business and need to deal with taxes for more than one state.
The merchants need different types of POS systems to fulfill their needs.
Cash register POS is one of the oldest and the most basic POS system. It mainly needs cash register and receipt printer.
Electronic cash register POS is same as mechanical cash register POS. This POS system has the ability to print out hourly, daily, monthly and yearly sales reports.
Software based POS systems allows the merchants to develop various types of sales reports on various factors like employee, POS product, etc.
Web-based POS systems take the software-based POS system to the next level where the merchant should have an Internet connection.
Wireless POS systems are Web-based POS systems. It allows the merchant to have a mobile presence. These POS systems are commonly used by street and conference vendors.
2. Highlight range of technology choices that are available for the retailers.
Solution:-
New Technologies Evolved or available in/for Retailing
1. Radio Frequency Identification (RFID)
Radio Frequency Identification in the retail industry has solved major problems related to customer services. With the help of RFID it becomes easy for the sales staff to locate a particular item in the store and check its availability in less time.
It’s a data collection technology that uses electronic tags for storing data. The tag, also known as an “electronic label,” “transponder” or “code plate,” is made up of an RFID chip attached to an antenna. Transmitting in the kilohertz, megahertz and gigahertz ranges, tags may be battery-powered or derive their power from the RF waves coming from the reader.
Like bar codes, RFID tags identify items. However, unlike bar codes, which must be in close proximity and line of sight to the scanner for reading, RFID tags do not require line of sight and can be embedded within packages. Depending on the type of tag and application, they can be read at a varying range of distances. In addition, RFID- tagged cartons rolling on a conveyer belt can be read many times faster than bar-coded boxes.
RFID in retail helps in the following ways:
(a) Improves the level of customer service
(b) Increases customers loyalty
(c) Better Inventory Management
(d) Item level tracking
The future of RFID is very bright in retail sector, as right from inventory management to product manufacturing, this system provides a more efficient and advanced retail experience to both the customer and the seller.
2. Smart Operating System
Supply chains can look very different from industry to industry. But companies across industries share a common challenge – finding ways to better manage growing uncertainty and complexity to improve supply chain performance.
To improve their supply chains, companies across industries have made sizable investments in a range of technology solutions, yet significant profitability improvements have remained elusive. Largely unaddressed has been the opportunity to use enterprise and supply chain data to support key inventory planning decisions that fuel execution systems and activities — something beyond a mere spreadsheet or desktop solution.
SmartOps customers are proactively managing supply chain uncertainty across all stages to improve their total chain inventory planning, so that their customer service levels can be stabilized and even increased while overall costs to the business are minimized.
SmartOps enterprise software solutions support many initiatives and challenges associated with different manufacturing and distribution industries from Lean Manufacturing, Just-In-Time (JIT), and Six Sigma initiatives, to postponement strategies, to Collaborative Planning, Forecasting, and Replenishment (CPFR), and Sales & Operations Planning (S&OP) activities.
SmartOps inventory optimization algorithms manage uncertainties in the data and offer visibility into the drivers of inventory at the item-location-time period level of detail. SmartOps is able to do that because it looks at the right granularity of data to adequately manage safety stock levels and understand where the biggest ongoing opportunities for improvement are within their supply chains.
3. Point of Sale
Capturing data at the time and place of sale. Point of sale systems use computers or specialized terminals that are combined with cash registers, bar code readers, optical scanners and magnetic stripe readers for accurately and instantly capturing the transaction.
Point of sale systems may be online to a central computer for credit checking and inventory updating, or they may be stand-alone machines that store the daily transactions until they can be delivered or transmitted to the main computer for processing.
Point of sale (POS) systems is electronic systems that provide businesses with the capability to retain and analyze a wide variety of inventory and transaction data on a continuous basis. POS systems have been touted as valuable tools for a wide variety of business purposes, including refining target marketing strategies; tracking supplier purchases; determining customer purchasing patterns; analyzing sales (on a daily, monthly, or annual basis) of each inventory item, department, or supplier; and creating reports for use in making purchases, reorders, etc.
Basic point of sale systems currently in use includes standalone electronic cash registers, also known as ECRs; ECR-based network systems; and controller-based systems. All function essentially as sales and cash management tools, but each has features that are unique.
3. What do you mean by Digital Signature? Discuss.
Solution:-
INTRODUCTION:
A DIGITAL SIGNATURE is a mathematical scheme for demonstrating the authenticity of a digital message or document. A valid digital signature gives a recipient reason to believe that the message was created by a known sender, such that the sender cannot deny having sent the message (authentication and non-repudiation) and that the message was not altered in transit (integrity). Digital signatures are commonly used for software distribution, financial transactions, and in other cases where it is important to detect forgery or tampering.
EXPLANATION:
Digital signatures are often used to implement electronic signatures, a broader term that refers to any electronic data that carries the intent of a signature, but not all electronic signatures use digital signatures. In some countries, including the United States, India, and members of the European Union, electronic signatures have legal significance.
For messages sent through a non secure channel, a properly implemented digital signature gives the receiver reason to believe the message was sent by the claimed sender. Digital signatures are more difficult to forge than the handwritten type. Digital signatures can also provide non-repudiation, meaning that the signer cannot successfully claim they did not sign a message.
DEFINITION:
A digital signature scheme typically consists of three algorithms:-
A key generation algorithm that selects a private key uniformly at random from a set of possible private keys. The algorithm outputs the private key and a corresponding public key.
A signing algorithm that, given a message and a private key, produces a signature.
A signature verifying algorithm that, given a message, public key and a signature, either accepts or rejects the message’s claim to authenticity.
HISTORY:
In 1976, Whitfield Diffie and Martin Hellman first described the notion of a digital signature scheme, although they only conjectured that such schemes existed.
Soon afterwards, Ronald Rivest, Adi Shamir, and Len Adleman invented the RSA algorithm, which could be used to produce primitive digital signatures. .
The first widely marketed software package to offer digital signature was Lotus Notes 1.0, released in 1989, which used the RSA algorithm…
Working of DS:
4. Briefly Comment on the Following:
a) The product tag contains both a customer-writable EPC number and a factory-set.
b) Retail companies need to keep up with their constantly changing industry to stay viable and competitive.
Solution:- N/A
5. Distinguish between the following:
a) Transparency and Tracking
b) Front Office and Back Office
Solution:-
Front Office/Back Office
The terms Front Office and Back Office are generally used to describe the parts of the company (or of its information system) that are dedicated, respectively, to the direct relationship with the client and proper management of the company.
The Front-Office (sometimes also called Front line) refers to the front part of the company, visible for the clients and in direct contact with them, such as the marketing, user support, or after-sales service teams.
In turn, Back Office refers to all parts of the information system to which the final user does not have access. The term therefore covers all internal processes within the enterprise (production, logistics, warehousing, sales, accounting, human resources management, etc.).
In reality, Back Office and Front office are not entirely separate since the teams in charge of the customer relationship must know a minimum of information regarding the process of producing the product or providing the service of the company. In turn, the sectors that are dedicated to product design must be kept informed of problems that are encountered by the users or, in turn, their needs, in order to reenter a circle of continuous improvement.
6. Write short notes on the following:
a) Global Data Synchronization
b) Business Process Management
Solution:-
Global Data Synchronization
The Global Data Synchronization Network (GDSN) is an Internet-based end-to-end integration system, allowing trading partners (Manufacturers, Distributors, Wholesalers, Retailers, Food Service operators and Healthcare organizations) to securely access and exchange product information in real-time. Trading partners always have the latest information in their systems, and any changes made to one company’s database are automatically and immediately provided to all of the other companies who do business with them. The GDSN uses the GS1 system based upon the Global Trade Identification Number (GTIN).
The foundation of GDS
- Product data is updated consistently between trading partners
- Data is validated against standards and business rules ensuring its accuracy
- Trading partners classify their products in a common, standardized way
- Trading partners have a single point of entry through their chosen data pool, reducing the cost of using multiple vendors
- The uniqueness of items, such as products, cases, pallets etc., is guaranteed through the GS1 Global Registry
Benefits realized by adopting GDS
- Standardized system for trading partners, reducing duplicate systems and processes
- Reduced costs through the removal of inefficiencies and exceptions
- Improved on-shelf availability, resulting in increased sales
- Enhanced collaboration between trading partners
- Support of new supply chain processes, for example, home shopping or RFID
Business Process Management
BPM is a systematic approach to improving a company’s business processes. For example, a BPM application could monitor receiving systems for missing items, or walk an employee through steps to troubleshoot why an order did not arrive. It is the first technology that fosters ongoing collaboration between IT and business users to jointly build applications that effectively integrate people, process and information.
BPM gives an organization the ability to define, execute, manage and refine processes that:
involve human interaction, such as placing orders
work with multiple applications
handle dynamic process rules and changes, not just simple, static flows, (think tasks with multiple choices and contingencies)
Important components include process modeling (a graphical depiction of a process that becomes part of the application and governs how the business process performs when you run the application), and Web and systems integration technologies, which include displaying and retrieving data via a Web browser and which enable you to orchestrate the necessary people and legacy applications into your processes. Another important component is what’s been termed business activity monitoring, which gives reports on exactly how (and how well) the business processes and flow are working.
Optimizing processes that involve people and dynamic change has been difficult historically. One barrier to optimization has been the lack of visibility and ownership for processes that span functional departments or business units. In addition, the business often changes faster than IT can update applications that the business relies on to do its work, thus stifling innovation, growth, and performance and so on. But today, the pervasiveness of Web browsers and the emergence of simpler application integration technologies such as SOAP/XML have enabled IT to deploy technology that supports the business process across functional, technical and organizational silos.
7. How Business intelligence software allows retailers to analyze profit and loss, including product sales analysis, operational expenditures?
Solution:-
Business intelligence software gives retailers or manufacturing companies the capability to analyze the vast amounts of information they already have to make the best business decisions. The software allows manufacturers to tap into their huge databases and deliver easy to-comprehend insight to improve business performance and maintain regulatory compliance.
The applications of business intelligence in the manufacturing industry are far-reaching. First, the extensive supply chains involve many different businesses in addition to the manufacturers themselves. Each supplier can benefit from tracking relevant and specific information in the manufacturer’s database. MicroStrategy offers a unified Web interface with extranet capabilities, which gives manufacturers an opportunity to grant suppliers access to a secure location where they can utilize MicroStrategy’s extensive analytical and reporting capabilities. The suppliers themselves can use the information the manufacturer has designated for them by running easy-to-understand and intuitive reports and analyses.
Across the Manufacturing industry, it is essential to have Business Intelligence software that allows multiple users to easily access the information relevant to them. MicroStrategy’s single, user-friendly Web interface and unique analytical capabilities allow different users to manipulate the data to glean the most from the information that affects their decision making.
In addition, manufacturing companies must manage large volumes of data from many sources, including suppliers, distributors, customers, and their own inventory databases. MicroStrategy’s unified information architecture allows companies to easily integrate and cross-reference vast amounts of information from multiple sources, identify relationships among the information, and learn how different factors affect each other and the company’s bottom line. MicroStrategy’s unique drill-anywhere capabilities allow users to perform in-depth analyses through many layers of information.
Finally, manufacturing companies must work to keep costs down while building profits. Business intelligence software allows manufacturers to analyze profit and loss, including product sales analysis, raw materials and supplier outlays and the cost effectiveness of different distributors. Companies can grow revenue by improving sales and customer acquisition and reduce costs by tracking the most cost-effective uses of materials and inventory, as well as improving operational efficiency and overhead costs.
(B) Essay Type Questions
8. “A typical retail store has a variety of computing devices on-site, including barcode scanners, laptop computers, PDAs, and voice handsets.” Comment on this statement with the help of a suitable example.
9. RFID (Radio Frequency Identification) has received a huge amount of attention in recent years, with many predicting that the technology will revolutionize everything from logistics to inventory processing to the customer experience. Elucidate the statements