Alliance Supermarket is gathering basic information using its point-of-sale (POS) system, and this is why the management is yet to reap the maximum advantage of this piece of technology. The chief information officer (CIO) is exploring ways of mitigating the loss of sales and facilitating customer satisfaction. The organization is also looking forward to reducing the costs of warehousing and overheads. Additionally, the retail outlet wishes to capture the kind of information which will help disseminate marketing messages to customers, and that includes promotion opportunities and new product offerings (Vonderembse & White, 2013). Despite the setbacks, a POS is still the most effective way to optimize the firm’s inventory management endeavors.
The Use of POS in Maintaining Adequate Stock
Alliance Supermarket is often selling particular products faster than they are re-stocked. The solution to this problem is to undertake demand forecasting. This strategy would facilitate the determination of what products should be ordered, as well as when this request should be made. The management must find the out-of-stock patterns by, for instance, noting the day(s) and time(s) when certain commodities are sold-out (Buschiazzo et al., 2020). By gathering and analyzing such kinds of kinds, stores can schedule delivery dates and times, and therefore, always replenish punctually.
The CIO should lead the organization in paying close attention to consumer trends. Currently, Alliance Supermarket is relying solely on historical data, and this is inadequate. It is imperative to also take a keen interest the emergent purchasing behaviors. There could, for instance, be a couple of new products which clients could be interested in. Alliance Supermarket should meet such needs as well in order to sustain customer loyalty (Nakandala et al., 2017). By understanding consumer trends, the supermarket would focus on re-stocking what is needed as opposed to products that are no longer in demand.
It is advisable to come up with re-order points to request supplies made at the most suitable times possible. Therefore, Alliance Supermarket should implement functionality in its POS that enables the management to get notified in case the organization is running low on stock (Buschiazzo et al., 2020). In case the re-order points are missed and a portion of safety stock is sold, more commodities must be ordered so as to replace that supply as well (Khachatryan et al., 2018). The fact that stock orders are filled automatically helps in saving time, and the internal stakeholders can focus their attention on another area of business where extra effort is required.
Using POS as a Cost-Reduction Strategy
Cost-saving is one of the most significant advantages of using a POS. The amount of money that Alliance Supermarket may save, especially on labor, is noteworthy. For example, it is unnecessary to hire people whose only responsibility is to search for items. They can simply be located and identified using the computer system (Buschiazzo et al., 2020). By having the right POS in place, the organization can reduce the number of employees or restructure their roles, and therefore, conserve financial resources.
There are other cost-reduction opportunities that Athatce Supermarket may exploit. The system would help in preventing the loss of items. In case the items are lost or misplaced, this information will be available in time. The firm should have a POS that generates reports charting stock changes that have been authorized during normal business days (Nakandala et al., 2017). That way, a manager will have important information at hand in case they need to investigate a loss.
Using Purchase Information to Target Customers
Alliance Supermarket should embrace a Customer Relationship Management (CRM) system, and the firm should have it integrated with POS. A CRM helps in managing sales, and delivering actionable insights about the customers. Indeed, this information will enable the firm to inform the clients on important developments, especially on product offering, in time. It should be cloud-based, and that would facilitate access to various applications which the management may decide to utilize at a later point (Buschiazzo et al., 2020; Khachatryan et al., 2018). The organization should also integrate customer service systems with market automation in order to avail a fufullyloud-based network for clients’ data.
Ethical and Privacy Considerations
The amount of personal information that is collected using POS is increasing. Data is gathered via email lists, delivery systems, and loyalty programs. Personal information includes names, addresses, phone numbers, emails, as well as cities and states of residence. There are numerous successful hacking attacks every year where businesses lose sensitive information. Organizations have a fiduciary responsibility to prevent such data loss, and one way of doing this is by avoiding the temptation to retain identifying information (Khachatryan et al., 2018). Alliance Supermarket should not retain credit card information, and any data that must be stored ought to be encrypted. The firm should also ensure that clients benefit as much as possible from this kind of data mining.
Conclusion
Alliance Supermarket is enjoying some advantages of using a POS. Nonetheless, this is at the basic level, and it is important to explore other ways through which the management can access and utilize more information. The purchasing patterns and consumer trends should be tracked, and there should be the implementation of re-order points. In addition to mitigating the risk of lost sales, a POS cost-saving endeavors. However, the use of POS systems can result in an ethical dilemma. In order to avoid the risk of losing sensitive information, the firm should only gather the pieces of data which are necessary to improve the customers’ experiences.
References
Buschiazzo, M., Mula, J., & Campuzano-Bolarin, F. (2020). Simulation optimization for the inventory management of healthcare supplies. International Journal of Simulation Modelling (IJSIMM), 19(2), 255–266.
Khachatryan, H., Rihn, A., Behe, B., Hall, C., Campbell, B., Dennis, J., & Yue, C. (2018). Visual attention, buying impulsiveness, and consumer behavior. Marketing Letters, 29(1), 23–35.
Nakandala, D., Lau, H., & Shum, P. K. C. (2017). A lateral transshipment model for perishable inventory management. International Journal of Production Research, 55(18), 5341–5354.
Vonderembse, M. A., & White, G. P. (2013). Operations management. San Diego, CA: Bridgepoint Education, Inc.