To understand how data management plays a role in the performance of retail businesses, Epicor commissioned IHL Group to conduct a study of small- to medium-sized retailers. Based on the data management challenges that each retailer reported, we compared the practices of those that are successfully staying ahead to those who are falling behind. Here’s what we found:
Establishing trust with your customers is hard to do and even more difficult to maintain, especially in a world where cyber threats are increasingly severe and threaten your data security. According to the study, 34% of successful retailers reported this as a challenge while those falling behind were 46% more likely to report that it is a key issue. Implementing security that provides the necessary safeguards can boost customer confidence in your business while increasing loyalty. Protecting your data is an investment; you can help it pay off in the long run by building a trustworthy reputation and protecting against financial damage.
Trying to get one, overarching view of business performance can be easier said than done, especially when multiple data sources are at play. In fact, 32% of retailers reported challenges with data centralization. Respondents using on-premises point of sale (POS) systems were 46% more likely to have issues with data centralization than those using cloud retail management systems (RMS). This is because cloud solutions offer streamlined integration capabilities, making it easier to move data from one place to another.
When looking at annual sales, retailers that are falling behind were 47% more likely to mention data centralization as a challenge and retailers that are ahead were 97% less likely to face data centralization as a challenge. This contrast clarifies that a central repository for your data is a critical factor in business performance and becomes even more crucial as companies scale.
Collecting lots of data is great, but the real superpower of data is being able to put it to work and gain insight from it. To do that, your data needs to be easily accessible. However, nearly a third of retailers in our study identified data accessibility as a key challenge. Like data centralization challenges, those using on-premises POS systems are 125% more likely to have issues accessing their data than those leveraging cloud technology. Retailers falling behind in annual sales were 45% more likely to report data accessibility as an issue. Data accessibility is key to business performance and with seamless integration between your POS and your RMS, the cloud can make it easier to achieve.
If the point of collecting data and putting forth the effort to transform it into business insights is to make better-informed decisions, you need the data itself to be accurate. Critical parts of your business such as inventory management, customer relationships, and overall business strategy are driven by the data that you collect. Say your system shows that you have an item in stock, when actually the shelf is empty. Customers who buy that product from you will be disappointed when they show up to purchase it and it’s not available, thereby costing you a sale. Twenty-four percent of retailers identified data accuracy as a significant challenge. By automating data collection and analysis, you can reduce the risk of human error and help ensure confidence in your data.
Successful retailers in this study are 97% less likely to have data management challenges overall, indicating a strong correlation between proactive data management and success. Don’t wait for a disappointed customer or a lost sale before you audit your data. Getting ahead of data management issues is the best way to optimize your operations, elevate your customer experience, and scale your business as you grow.
Download the report to get the complete analysis on how your peers are navigating data management challenges, what successful retailers are doing to staying ahead, and how they are prioritizing budget toward investing in other technologies.
