Consolidating Networks

By  Carly Bohach — July 27, 2006

The convergence of data, voice, video and wireless capabilities on one network is critical for retailers who want to lower costs and increase efficiencies. In the last 12 months, weve seen a shift to more of an enterprise-wide strategy that s voice, video and data, says Gerry Hansen, partner with the consulting firm Ncompass.Retailers are realizing its a reality to put all of these services together. It brings down costs for retailers, increases productivity and improves customer service.

Le Creuset, a 37-store cookware retailer, was able to reduce telecommunications costs substantially by converting to one network with the help of Savvis Network Services. We were prepared for an increase in per-store costs due to the new network solution, but by choosing to use one network we were actually able to save money on our overall telecommunications costs, notes Bruce Wallingford, IT director. The Savvis network supports our POS system and allows us to run both data and voice applications which lowered our overall costs by 30 percent.

We wanted to upgrade our POS system, but couldnt take advantage of the new systems functionality using the dial-up network connections we had in our stores, says Wallingford. During its communications transformation, Le Creuset took advantage of a single, converged voice and data network to connect its operations centers and stores nationwide. Le Creuset chose Savvis to power applications such as its point-of-sale system, credit card transactions, inventory management, e-mail and Internet access. The network also will provide for real-time polling of the point-of-sale system, which will allow the retailer to collect and process information more efficiently while improving the accessibility of sales performance data.

Le Creuset of America is manufacturer and retailer of enameled cast iron cookware. Le Creuset owns and operates 37 U.S.-based stores and also owns Screwpull, a wine accessories retailer.

Bringing in New Customers

Looking to extend its reach beyond its home stores, the New York-based Duane Reade, a full-service drug store chain, turned to New Edge Networks to provide them with one network for voice, data and video. New Edge has the most cost effective and robust network for providing voice, video and data through one network, says David Siegel, general manager of DR Express. We wanted to bring the pharmacy to locations such as hospitals, clinics, physician offices and office buildings. We wanted to gain customers by changing the way they shop for prescriptions.

Duane Reade is expanding its reach with 90 recently opened DR Express pharmacy self-service kiosks. The New York-based retailer operates 250 stores in the New York metropolitan area, and began its kiosk program with a pilot of two facilities in 2003. The pharmacy kiosk is equipped with a flatbed scanner, Web camera, touch-screen monitor, and voice communication, allowing individuals to interact directly with pharmacists.

We now have 90 kiosks in operation, says Siegel. There are 30 kiosks located in Duane Reade stores, and 60 kiosks are placed in outside locations. We have doubled the number of kiosks over the past year, and we plan to continue on this growth rate. I am unable to provide specifics, but over half of the revenue brought in is new, incremental business.

DR Express kiosk users can interact in real time with a pharmacist to discuss drug interactions and other questions, transmit prescriptions, order refills, and transfer existing prescriptions to the pharmacist. Prescriptions ordered through the kiosk can be picked up in any Duane Reade store. We fill 4,000 prescriptions per week through the kiosks, and lines in stores with the kiosks have decreased, says Siegel.

Duane Reade also is using the kiosks to bring in alternate revenue through supplier advertising. We have brought in over a hundred thousand dollars of advertising revenue from marquee companies such as Abbot, Roche, Eli Lilly and Novo Nordisk, Siegel explains. Duane Reade is considering taking the program one step further by adding a mini lock box component that will allow users to pick up certain medications at the kiosk location.

However, its clear that one consolidated network can help improve efficiency and productivity for a number of store processes. Retailers who realize the benefits of combined network services are aggressively deploying broadband networks that enable them to do more for less while improving the customer experience and the bottom line.

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