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Alliance Supermarket has been using a point-of-sale (POS) system for a number of purposes. One of them is to keep track of inventory in the various outlets. The system uses laser to scan the Universal Product Code (UPC) of each item at the checkout counter.
The firm is using the code to track the inventory records of all products. It is noted that the system has enhance the company’s inventory management. However, a number of problems have been noted.
For example, the company is unable to deal with sudden spikes in demand for certain items. In addition, all the outlets are treated by the system as a single unit.
In this paper, the author analyzes the various issues associated with Alliance Supermarket’s POS system. To this end, the author will formulate new and innovative applications of data from the system. Information that can help the company to reduce costs while improving services will be highlighted.
In addition, an alternative strategy that can be utilized by the firm to access data from individual consumers is proposed. Finally, ethical and privacy considerations in relation to the information gathered are reviewed.
New and Innovative uses of Information from the POS System
The information from the POS systems can be very useful to Alliance Supermarkets. The company can come up with new and innovative ways of using the data. The systems are used to keep track of all sales in the supermarket, regardless of whether they are big day sell-out for a certain product or a low day for another item.
The information collected can be stored securely in one database. From the database, managers and other end users can analyze what customers have bought in large quantities during that day. It is also possible to see the type of product that has sold out in that specific day.
In addition, the individuals responsible for sales and marketing can analyze the reasons why customers prefer a specific product. They can achieve this by comparing its performance with that of other products from the same line (Gunasekaran, Marri, McGaughey & Nebhwani, 2002).
If it is noted that the preference is as a result of the low prices associated with the item, then the management of the supermarket can come up with ways to standardize the cost of all products (Vonderembse & White, 2013).
Information stored in the database for a span of one month or one week can also be used to identify the products required in large quantities. Such products will then be ordered from the suppliers.
If the information from the POS system is stored and used in this way, then it can be very easy to manage the demands of the customers at any time of the year. Such a move can help the management to forecast demand and supply (Morgan, Kaleka & Gooner, 2007).
Using this information, the sales and marketing employees can draw graphs of different products and how they perform on weekly and monthly bases. Consequently, a picture of what to expect in the future is made clear.
Using Information to Reduce Costs at Alliance Supermarket
Information stored in the POS systems can help the supermarket to reduce operational costs while providing improved services at the same time (Brown, Bessant & Lamming, 2013). A case in point is inventory management. If a system to carry out the task is unavailable, the process may require many employees.
Increasing the number of employees needed to monitor inventory translates to an additional cost to the supermarket (Vonderembse & White, 2013). In addition, the process may be brought down by human error. The use of the POS system reduces the number of employees needed.
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Consequently, it enhances efficiency in inventory management. In light of this, it is clear that information from the POS can help the company reduce costs while improving the quality of services.
Apart from predicting future demands and determining the price of different products, the purchase information obtained from individual customers can be used by Alliance Supermarkets to create a new approach of estimating the maximum stock limit to be kept (Morgan et al., 2007).
The limit to be maintained by the supermarket can be set by observing the consumption trends among the consumers (Brown et al., 2013). As a result, the supermarket can handle its orders more efficiently without worrying that some products may go bad.
Ethical and Privacy Considerations
A number of measures should be taken to safeguard data. For example, information from the system should be secured to enhance privacy and conform to ethical provisions. The supermarket relies on the information to manage its inventory. Business ethics and conducts should be observed.
Only the persons in charge of this function should be authorized to check into and out of the database. Securing the database will ensure that information is protected from any unauthorized access (Vonderembse & White, 2013). As such, the data stored can be relied upon to make decisions in the future.
It will be regarded as a true representation of the opinions of the consumers.
Brown, S., Bessant, J., & Lamming, R. (2013). Strategic operations management. London, UK: Routledge.
Gunasekaran, A., Marri, H., McGaughey, R., & Nebhwani, M. (2002). E-commerce and its impact on operations management. International Journal of Production Economics, 75(1), 185-197.
Morgan, N., Kaleka, A., & Gooner, R. (2007). Focal supplier opportunism in supermarket retailer category management. Journal of Operations Management, 25(2), 512-527.
Vonderembse, M., & White, G. (2013). Operations management: Concepts, methods, and strategies. San Diego, CA: Bridgepoint Education, Inc.