Nucsoft ERP in Small Retail

Prerna Makhijani Brandon Frankel

December 2011

Primary Research In order to conduct our primary research we spent time visiting stores in various industries including clothing, home dcor, clothing accessories, smaller grocery stores and mobile phone stores. While visiting a dozen stores it became clear that many stores still use a manual system while other stores use a computer system. The stores using a manual system seemed very resistant to even considering a non-manual system. They did not want change and were content with the system they used. I wont change until the government makes me one storeowner explained. It was hard for the owners of these stores to understand how a technology solution could benefit them and many did not seem to be interested in growing their own business. The managers of the stores using a traditional ERP system explained that they found their system to be just fine and did not want to have the worry about switching to a new system. These managers did not have any extreme functionality requests and probably would be satisfied with the current features and functionality of the Nucsoft software. The best way to convince these managers to switch systems is by offering a lower price. In some cases this will be tough because they have bought a system already and currently are not paying a lot of money (or any) for their ERP system.

How to Market After conducting research it is clear that to convince potential customers to buy the Nucsoft system a strong focus in the sales and marketing process will be to introduce the benefits of the system. In order to convert to a sale, the potential customer must understand what they are going to gain. The largest benefit will be cost savings along with the ability to increase revenue. i. Reduction in costs 1. Quick checkout process which will reduce labor, hardware and checkout counters 2. Up to date data at all times. No need to close the books at the end of the day 3. Easier to use, less technical issues and less training time 4. Efficient collaboration across geographies 3

5. Ability to respond quickly to business demands 6. Production Management improvements (quality control, process control) 7. Enterprise Management improvements (financials, HR, project management) 8. Overall ERP systems have been proven to be more expensive than the SaaS model.

ii. Increase revenue 1. Quick checkout process, therefore customer satisfaction goes up which can increase the word of mouth reputation of the store 2. Supply Chain Management; increase data on inventory to help increase opportunities. 3. More adaptable than traditional ERP systems 4. Demand Management, better able to predict sales of each product.

Factors influencing a customers decision:

Data from Aberdeen Group. November 2011. Aberdeen.com

Competition

Company

Description of Service

Price Wide range in prices. Rs 5,000 to 125,000 per year

URL

Go Frugal

Wide range of services and complete packages.

http://www.gofrugal.com

Netmagic Solutions

Data hosting service including hosting dedicated cloud, online data backup and disaster recovery options Mostly cater to CRM related programs. Their methodology is mostly to collect databanks of clients through cloud computing. After capturing the data with the help of a UID (mobile phone in most cases) for every customer, analytics and trends are developed to reveal customer behavior and develop campaigns.

3 packages on a monthly basis: 3590, 5790, 9590 OR 6, 10, http://www.netmagicsolutions.com/cloud15 per an hour pricing-models.html

Capillary

Rs 5,000 per POS

http://capillary.co.in/

Two types of variations available: Offline and Online. Offline mostly used as Data Synchronization. For the online model, data is stored on the cloud. The complete package is offered right from the POS, front-end application to web hosting of data. Features like billing, inventory management, accounting part of the product Wondersoft called eshopaid. Includes the whole package; POS, planning & forecasting, CRM, inventory and money tracking

Initial setup is Rs.50,000. Subsequent monthly charges per POS are Rs.3000

http://www.wondersoft.in/

Vesture India

Setup fee is Rs. 100,000, plus a Rs 500 or 3,500 http://vestureindia.com/cloudper month solution.html

Final Recommendation The potential customer list is divided up into two major groups; stores using manual solutions and stores using an ERP system. It will be very difficult to target stores using the manual solution because not only would you have to sell the Nucsoft software but technology in general. This is a much larger task. Labor is cheap and often store owners are set in their ways which they learned from previous family members. Therefore we recommend not targeting this group of owners. Instead Nucsoft should target current ERP users by focusing on the benefits of moving to the cloud. We are confident that the Nucsoft solution will lower costs and could increase revenue, but in order to make sale the solution must be at a low cost. The storeowners need to be able to immediately see cost savings. The store owners would be reluctant to make an initial setup investment, i.e. a lump sum of money along with the monthly/pay as you use model. The better way to make sales would be to make sure that the customers give it a trial run and not see it as a huge investment. As they would realize the benefits of Nucsofts services along the way, more offerings on the services can be made and subsequently revenue generated. Nucsoft should not only target smaller retail shops with one to four outlets but also target all SMEs, which will include shops with many more stores. This will increase the amount of potential targets and these shops are better able to see the benefits of the system compared to smaller family owned businesses. In order to gain credibility in this market Nucsoft should not be afraid to rely on their past success with financial institutes. By including this in a sales pitch Nucsoft gains credibility and shows that security should not be an issue. How to go about it Strategies should be chosen as to keeping in mind the business objectives as well as to meet the target customers need and requirements. Considering we are targeting customers who are at least familiar with technology we should find some ways in which marketing and eventually sales can be promoted. 1) Drive inbound marketing through the service website. Internet marketing should be done when a prospect does a 6

Google search, visits a forum or a blog, visits key websites in your industry, reads articles online, etc. 2) Use Social Media (Facebook, etc) to promote the Nucsoft software. More adept technology owners are increasing including social media influences when making business decisions. 3) Make new customers experience the software. Include a free trial (time-limited or with reduced features) or a free basic version of your software to allow prospects to immediately experience it. Or perhaps a demo or a video if the former is not possible. Also a customer should be able to immediately start using the software. There should be no time lag in terms of installation, setups etc. 4) Leverage on existing customers for new business and referrals Make the existing customers a part of the marketing strategy. Send out an email newsletter or be active on customer forums etc. as well. 5) Establish a partner ecosystem. Its important to network with partners who have complementary relations with the target customer (for eg. an accountant). They need not be related to the technology industry always. 6) Develop a channel program. Resellers, OEMs, distributors or consultants could be identified who could be a valuable channel for the software. Establish an affiliate program. Make sure there is sufficient training and incentive for the channel partners to actively market and sell the software. This might be at a later stage though.