Shared Services

“The priorities for the year ahead are expense control and stock management.”

The Shared Services operation within New Clicks includes distribution and logistics, merchandise services, information technology (IT), marketing, organisational development, and finance and administration. The priorities for Shared Services in the year ahead – notably expense management and stock management – are covered in the group leader’s report.

South Africa
The South African IT operation has been hampered by inflexible legacy systems and consequently an enterprise resource planning project (ERP 2) was initiated. A decision was taken to replace the core of the merchandise system with JDA. This will include the implementation of the following systems:

 – JDA Merchandise Management System at the core;

 – SAP Financials;

 – SC Manager Warehouse Management System; and

 – Retalix/Storeline point-of-sale technology.

These systems will simplify and integrate complex processes currently being conducted on several systems across the group.

The total IT capital expenditure is expected to be around R97 million for the new financial year, of which R42 million will be spent on projects and R55 million on systems for stores.

The finance and administration team is currently introducing SAP to improve the accuracy of information, enhance reporting and improve response times. This project is expected to be completed by September 2004.

Other priorities include the integration of financial systems for the pharmacy project, enhanced reporting to facilitate performance management of results and cost control, financial support to the brands and a re-evaluation of the EVA (economic value added) performance scheme.

Australia
The shared service capability of New Clicks Australia (NCA) was fundamentally restructured during the year to provide the necessary skills and service levels to both franchise and company-owned stores. Following the acquisition of Price Attack, more than half of the 334 NCA stores are now franchised. The support functions required by franchisees differ markedly from the needs of company-owned stores.

The launch of the pharmacy offering also proved challenging and has required extensive shared services support, particularly the development of an integrated IT solution and an efficient supply chain process. The first phase of the JDA merchandise system was implemented, while the new point of sale solution was rolled out to the Priceline stores.