MINIMUM RETAIL SYSTEM REQUIREMENTS
During the fall of 2010 we sent out a survey concerning the software packages retailers were using. The results of that survey were sent to the respondents the first part of November. As a result of that survey, we have had several requests for some more detailed information about what to look for in a retail software package. Therefore, following is a brief list of the minimum requirements we look for when evaluating a software package. Be aware that a very detailed system requirements document can be 50 plus pages long. This is a good starting point if you want to do this yourself. It makes it quick and easy to see if the system or systems you are looking at will do at least the minimum needed for you so you can manage your inventory and customers (clients). We recommend that you set this up as a spreadsheet so you can look at the systems side-by-side for ease of comparison.
1. Price of software, including initial training.
2. Number of users per system? Price for 1 user and also for 2 users (POS + office), or more.
3. Price of hardware needed (PC, bar code scanner, printer, etc.)
4. Usual response time for support calls
5. How long have you provided software to retailers? (Note: should be similar to your retail store.)
6. Does your system include a GL module? If Yes, is there an additional charge for it?
7. If no GL module, what accounting software package do you integrate to? And how much do you charge for integration?
8. Does system Include an easy-to-use report generator/writer for user defined custom reports? (not Crystal, which generally requires special training on how to use)
The following are for Customer Marketing:
1. Can I get a listing of customers who purchased a particular item, by brand, color and/or size (if using SKU)?
2. Can I get a listing of customers who have not made a purchase in the past 3, 6 etc. months?
3. Can I get a list of customers by the dollar amount they have spent in the past 3, 6, etc. months?
The following are about merchandising:
Note: A classification is traditionally defined as a "customer demand center". It is what the customer asks for when they come into the store, such as a suit, sport coat, dress, jeans, etc.
1. Do you use the Retail Inventory Method at the classification level or allow it as an option?
2. Do you allow use of the 4-5-4 Retail Accounting Calendar in addition to the normal monthly calendar?
3. Are all inventory reports available at the classification level so none of the detail shows?
4. At the classification level, do you calculate and show the following on reports that are available to be printed? If Yes, please provide formula you use.)
a. Initial Markup % for the month and Cumulative? (Also called markon or markup)
b. Markdown % for the month and YTD
c. Gross Margin % for the month and YTD? (Also called maintained markup or margin)
d. Retail shrinkage % as percent of net merchandise sales
e. Stock Turn Rate using the average of the past 12 months inventory at retail (formula is: Total Net Sales for the past 12 months divided by the average of the past 12 months of BOM Inventory OR divided by the average of the last 365 days of retail inventory)
f. On Order at retail by month, by classification
Ask them to provide samples of reports showing the above retail data at the classification level. Make sure the reports are easy to read and you do not have to print 3 or 4 just to get the information you want.
Check with at least 3 software vendors. Once you have narrowed it down to 1 or 2, schedule a demo. Be careful! During a demo, it is the sales representatives' job to show you how wonderful their system is. It is up to you to have your prepared list of things you want the system to do and have them show you how those things can be done on their system.