In this paper I explain what opportunities Kudler Fine Foods has in terms of information technology, and describe how the company might benefit from implementing enterprise-wide computer information system.
Computer information system brief
Kudler Fine Foods (KFF) is a local chain of gourmet food stores with annual sales of more than 10M offering specialized products to targeted customers. The company has three locations in the San Diego metropolitan area (La Jolla, Del Mar and Encinitas) and plans to add more stores soon (Kudler Fine Foods, 2008). As a typical mid-size food retailer KFF has following key accounting information system needs: •
Inventory management and optimization
Customer and sales management
Revenue management (including bank reconciliations and cash ) •
Reports and inquiries
Employees and payroll
Kudler currently has an individual point-of-sale (POS) computer system in every store. The elements of each store POS are connected through Ethernet. 56K modem provides an internet access. All Kudler’s hardware and software are outdated. Each store keeps data on a separate server, store’s systems are not connected and don’t share POS information. KFF computerized most strategically important operations, but didn’t integrate them in enterprise-wide information system. The reliance on manual processes for such important areas as cost management, inventory replenishes, and financial statements, as well as the lack of integration between store locations show significant room for improvements. The main disadvantages of a current Kudler’s information system are luck of integration between all stores and outdated hardware and software. Current Kudler’s system should be replaced with new and effective enterprise-wide information system. Until such system is in place and fully functioning it is highly advisable for the company to not seek out new locations. Inventory management and optimization
Inventory management is the most important part of a retail business. To satisfy customers supermarkets have to have big variety of perishable and not perishable items. Retail industry is very competitive. Storage place in a supermarket is limited and must be used as effectively as possible. If a retail store does not carry enough of a product, then there is a loss of potential customers. On the other hand, if a store is overloaded with perishable goods that are not selling, the business loses money. Keeping up with large quantities and varieties of goods can be difficult, even with the help of an automated system. Kudler doesn’t have a purchasing department and relies on each store manager to order inventory. Purchase order is the main document in replenishing an inventory for Kudler. Prepared purchase order forms are mailed, handed to supplier salesmen, faxed, or sent by e-mail. Each store manager has to perform manual work to prepare purchase orders, to check with counterparts at the other stores on the pricing, quality, and delivery. Store managers are encouraged to combine orders between their stores if they feel they can save from ordering a larger quantity of a particular item or multiple items. Current Kudler’s inventory system is vulnerable to human errors and is inefficient. Store managers have to perform theirs managing duties and at the same time to work as purchase agents. The company is not benefiting from it. The inventory management should be done through integrated computer system for all three stores and delegated to several individuals or a department who would take care about the entire chain. The whole process can be paperless by utilizing intranet and internet. Customers and sales management
Price is not the primary differentiating factor for Kudler consumers; they are focused on quality and variety of specialized items. Customer satisfaction is directly related to inventories and quality of customer service. Current Kudler’s information system limits company’s...
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