By  on June 17, 2008

Oracle today will unveil the general availability of Oracle Retail Release 13, making good on the company's promise to integrate the software from its many acquisitions, with the upshot that retailers will be able to manage more complexity and increase gross margins.

The integrated retail suite puts Oracle on par with SAP, said Hung LeHong, an analyst at Stamford, Conn.-based Gartner Inc., and allows all retail employees — from financial planning to merchandising to markdowns to warehouse to store operations — to work off the same data.

"We're connecting all those pieces so the right hand talks to the left hand," said Dave Boyce, Oracle vice president of product strategy. The software "can drive 5 to 15 percent improvement in gross margin dollars," according to Boyce.

Three of the 33 applications are new, including a dashboard that can be customized to alert merchants to potential out-of-stocks, open-to-buys and markdowns at competitors. Also new are applications to set regular prices and optimize sizes, so merchants can plan their buy or allocations based on sizing needs at each store. Release 13 incorporates merchandising, optimization and store operations software from previously acquired companies Retek, ProfitLogic and 360Commerce. E-commerce is not part of the release.

Much of the savings comes from optimization, but more precise buying, allocation, better inventory management and spending less on IT also contribute, said Boyce. Retailers can expect a 1 to 2 percent average point improvement in gross margins just from optimization, said LeHong.

Many routine operations are handled automatically, as are interdependencies. So, for example, if a merchant takes markdowns, the software automatically adjusts its inventory forecast for increased demand. That helps retailers manage more complexity, such as faster turns. "The same forecast is visible no matter where I am in the planning cycle," said Boyce.

Abercrombie & Fitch is one of three retailers in Oracle's early adopter program that have begun implementing Release 13, although it has not yet gone live or been rolled out. Among the 2,000 or so customers who use Oracle retail applications, 150 are fashion retailers, said Boyce. Wal-Mart and Tesco also use Oracle applications. Oracle expects twice as many retailers will implement the new software versus Release 12.Release 13 is aimed at retailers doing at least $250 million a year. A software license starts at about $2 million. Implementation could cost one to four times that, said LeHong. As is typical of any integrated software that touches many departments in an enterprise, implementation can take anywhere from one to three years, depending on the scope of the project, he said.

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