An in-house computer can bring more hardware turns

! I-ECTnOUC data processing

L has been around in the hardware/ home center business since the late 1960s with dealers picking and choosing the bits and pieces that fit their needs.

Some dealers have used association compuler services to take care of their accounting needs. Others have utilized electronic merchandising services offered by wholesalen. Some have replaced mechanical cash registers with electronic models which compute faster but do not store data.

Now with the state of the economy, inflation and expensive money, dealers

Story at a Glance

Computer provides better management increased profitability firms develop systems for hardware/home center retailers.

are looking for ways to increase their profitability. A tool, and it must be emphasized that it is a tool with human effort needed to make it work. touted by many is the in-house computer for better management with increased furns on inventory.

For the hardware retailer to win the inventory game, he must buy the right quantities frequently enough to remain in stock without overburdening himself with excess inventory. Ideally, he should be able to maintain or increase service levels while lowering the number of dollars invested in stock.

Computerization is the answer according to many. At least one computer systems corporation, Triad, of Sunnyvale, Ca., agrees and has developed a point of sale system capable of providing an item inventory for the hardware industrv.

"We're designinj a complete system for hardware operations that are doing as linle as $500,000 a year," says Stuart W. Clifton, v.p. and gen. mgr. After launching the automotive after-market jobben in computers with 2000 installations to date, the firm is readying to serve the hardware field "because the retailer is often getting a poor turn rate on his inventor]," Clifton explains. "Often he finds that he can't afford to restock with the same qoods he had before they were sold. We want to help him increase his turns and profits. Our goal in the first year of an installation is to add one-half turn on inventory. "

At present, Triad is installing its svstem packase for the hardware/home ci:nter industri in California and establishing officei in Portland, Or., Seattle and other western states in the coming year. Although they have a national sales and service organization serving the auto parts dealers, they are mo-ving from tlie West Coast to the eastern and southern states with the hardware/home center program.

Cost of installing the system varies with the needs of individual retailers, but falls in the $40,000 and up range including hardware, software, trainine and total support. In addition to thE one year supiort (wananty) which can be extended for a second year, they offer program enhancements. These are revisions and added capabilities to keep the equipment current over the years.

Payback, forecast in a written proposal before a retailer agrees to the program, is projected at twice the cost of the system. For cost justification they feel it should be reached in one year. Equipment also can be leased.

Although Dataline and Epic supply software (program) packages to the lumber and building supply dealers, Triad diffen, according to marketing director John Sayers, in providing both software and hardware (equipment) plus software enhancements. It designs and manufac$res the point of sale terminal and computer with other hardware such as printers supplied to their specifications.

Their system begins with an electronic point of sale terminal to store data for communication with the inhouse computer. From this data a variety of inventory management reports can be prepared including zero sales and overstock reports, promotion analysis, and a seasonal item report as well as reports on department sales, markdowns, and sales rankings by stock keeping units and departments,

In addition, the system has pricing functions to calculate prices based on desired margins, print price and bin labels, prepare purchase orden, price changes, and complete inventory. Purchasing functions, preparing orden for a supplier, calculating reorder quantities, preparing orders for alternate suppliers, conholling backorder, and preparation of purchasing reports by departrnent, class, and SKU, also are possible. In receiving functions the computer can update inventory records, handle items received by exception for fast entry, and verify vendor invoices by costing each packing slip automatically.

Sales analysis can be based on sales and profitability by deparfrnent, class, and item with reports on charge sales, cash sales, markdown and promo(Please fitrn to page 65) lll-H0USE computer system begins with a point 0l sale cash terminal. This one, with a cash receipt printer, is part of the hardware designed by Triad Systems Corp. for hardware/home centers.