Why Automation Is Critical in Indian Retail



The Context Of Indian Retail

Statistics from the Indian Brand Equity Foundation (IBEF) put India as the fifth largest destination in the retail space. This means big changes for retailers in the country. As international brands make their entry into the Indian market, and along with changes in regulations like GST, it has become increasingly important for domestic retailers to acknowledge the importance of having robust automation infrastructure and the efficiencies it can bring.



Areas Of Opportunity

Automation in retail is nothing new for international brands. In fact, it forms the very basis of their operations. Some of the best areas of opportunities for automation are in replenishment, cycle counting, bookkeeping and price changes because they consume most of the non-customer facing hours of employees. An example of automation in action is how Retail Pro provides over 200 price levels for a single item. The software automatically determines the price for an item depending on where the item is sold. So, if you are selling at a high street or at a duty-free airport location, automation ensures that the right price is used. Also, these prices can be updated once at the head office and the changes will reflect in every store. Hence, automation and centralization can give retailers great levels of control and oversight over their operations.


Automation is key to operational excellence. Operational excellence in retail means automating day to day chores and making the automation solution raise alerts to management only when a critical decision is to be made. For example, Retail Pro allows for defining the allocation of merchandise between various stores while raising a purchase order. Depending on the sales patterns across stores, personnel at the head office can determine the ratio of stock to be delivered to each store, and provide that ratio while raising a purchase order. Simultaneously, transfer orders and shipping notices can be raised to notify stores of the merchandise that will arrive soon. Through such allocation patterns, there is no need to create a purchase order for each store, thus leading to efficiencies in management.


When operations grow, there comes the complication of working with multiple operational models. Stores can be Company Owned Company Operated (COCO), Company Owned Franchise Operated (FOCO), Franchise Owned Company Operated (FOCO) and Franchise Owned Franchise Operated (FOFO). A brand could be operating multiple stores that work with one or all four of these operational models. There is also the issue of management requiring reports from such stores and also from various subsidiaries, each of which can have hundreds of stores within them. It can be tedious to determine which staff member has access to which report. Fortunately, automation can make processes highly streamlined. Reports can be scheduled to run at daily, weekly, monthly and any custom interval. They can be sent in an email addressed to specific staff that can access the reports.



The Future Of Automation

Automation in retail has great potential in the near future. New technologies are coming up for solutions from the loading dock to the checkout line. The use of video analytics for warehouse management is an example of how cameras and machine learning can come together to give tangible increases in operational efficiency. The use of mobile checkout devices has made it possible to sell merchandise in any type of location, a be it kiosk, a pop up shop or at an event. The Indian retail industry is on the brink of a revolution in terms of adopting new technologies in automation. IBEF predicts the Indian retail sector to grow to $1.1 trillion by 2020, and automation will be critical to retailers that are looking to scale up their operations in a sustainable manner.

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