engleski

Information Technologies and the Formation of Croatian Retail Chains

In this paper, we will present the phases in the use of Information technologies on the example of a Croatian retail chain. The purpose of this paper is to find specific characteristics in the formation this retail chain’ s retail business units and the implemented and planned solutions related to information technology management (IT management). One of the larger Croatian retail chains is “ Biljemerkant” Ltd. Osijek, which, with about 815 employees, had a gross revenue of 295 million Kuna in the year 2002. The merger of “ Biljemerkant” Ltd. Osijek with CBA – Croatia, a national association of tradesmen (founded at the end of 2001) indicated the much greater needs and possibilities of utilization of contemporary information technologies. That is, simultaneously with the arrival of large foreign retail chains and appearance of their devastating competition, and as a result of the changes in the buyers’ consumer habits, new market conditions were created, which have directly influenced the business operations of small and medium size domestic retailers (Vugrić, 2002, p. 160). The purpose of the foundation of CBA – Croatia was mainly to create more favorable terms for procurement and sale of goods, to create partnerships with Croatian manufacturers, and to allow for better organization of business operations and reduction of fixed expenses. On almost the entire territory of the Republic of Croatia a system of members and sub-members has been created, based on the system of regional centers (members) which can then admit their sub-members. The Association’ s central administration concludes businesses (a) in the name and on behalf of its members (as their representative), (b) in its own name, and for the account of its members (as a commissioner). Today, CBA – Croatia, the Croatian national commercial chain (“ Central commodity basis” ) has 10 members. CBA chain members alone have more than 350 shops and more than 100.000 m2 of sales area (Trade, 12, 2002). “ Biljemerkant” Ltd. Osijek develops mostly the form line of the so called neighborhood shops, whereas other CBA chain members also develop large surface stores. According to the research conducted by Croatia Gfk Zagreb, the share of small retail shops on the Croatian retail market dropped from 68 % in the year 2000, over 53 % in 2001, to 45 % in the year 2002. (http://www.gfk.hr/press/trgovci.htm). In the formation of shops CBA - administration helps the members: (a) in ensuring price competitiveness through more favorable procurement conditions ; (b) through the completion of products assortment ; (c) in utilization of the efficiency of volume economy in the supply by using common supply from a smaller number of suppliers (for its members and sub-members, as well as through uniting and joining supplies with similar foreign associations and through focusing on strategic suppliers) ; (d) in developing partnerships with suppliers, first of all through the conception of merchandising, i.e. category management ; (e) in developing common corporative marketing, creating and using common visual identity, public relations and the like. It has also been planned to develop CBA’ s own commercial brands in cooperation with domestic manufacturers. The intention is to increase the present market share of 10 % on the Croatian retail market on the basis of further turnover growth. In the development of information technology Croatian retail trade, in general, lags behind the developed world. That is, in the USA e- commerce has developed in three phases (Kalakota/Robinson, 2002, p. 5). In the first phase (1994 - 1997) it was necessary to ensure one’ s presence on the Web, in phase two (1997 - 2000) there are already the beginnings of transactions - buying and selling by means of the digital media, and the third phase goes even further – but it is only in this phase that the Internet can influence the profitability - P2P (pat to profitability). Croatian retail chains are only at the start of the above mentioned second phase and there are some examples of Internet retail trade (Trade, 7/2002, p. 19). However, in the CBA – chain, the Internet technology is still not used for the execution of business transactions. In 1996, in several of its shops, &laquo ; Biljemerkant&raquo ; has started installing first EPOS – terminals connected to a central computer through telephone lines and modems, and in 2001 it has started using the Internet and a virtual private network (VPN). This has made it possible to connect about 200 shops (with more than 350 personal computers) with a central computer system and thus to make available all data and applications on the network. For that purpose, &laquo ; Biljemerkant&raquo ; has developed its own software &laquo ; OPAL&raquo ; in Visual Basic, and data bases for it were created in Microsoft Access. VPN is flexible enough to allow, at any moment, to change the provider or the connection speed, to add a new shop to the network, and the like, without fundamental changes in the computer network conception. Only in the time ahead of us (in a year or two), members of the CBA -chain will start using Internet technology for business transactions as well (B2B, B2C). Then the so called multi-channel retail trade systems (“ click and mortar” ) will come to expression. On the other hand, “ Biljemerkant ” Ltd. Osijek will be the intersection or meeting point of supply chains (SCM) of its suppliers (SCM) that are engaged in e - commerce.

Information Technology; Retail Chain; Republic of Croatia

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