Landsteinar targets retails with ERP app

Alpha Landsteinar has entered the Middle East market in an attempt to become the region’s preferred supplier of enterprise resource planning (ERP) applications for the retail sector.

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By  Maddy Reddy Published  October 27, 2003

|~||~||~|Alpha Landsteinar has entered the Middle East market in an attempt to become the region’s preferred supplier of enterprise resource planning (ERP) applications for the retail sector.

From its recently opened Dubai headquarters, the UK company will be touting its Microsoft Business Solutions-based application as a package capable of covering everything from point of sale (POS) through to back office billing and logistics.

“Landsteinar’s retail solutions cover everything… and our business consultants ensure companies rapidly realise a competitive advantage from their technology investment,” says Ole Milan, managing director for Landsteinar in the Middle East.

The software vendor already has a number of customers within the Middle East, including Spinneys, Bahrain Duty Free and Beirut Duty Free. However, Landsteinar Middle East intends to grow this installed base yet further by tapping into the local retail sector’s new-found passion for technology.

“Retail is a booming industry in the Middle East, as shown by the new shopping complexes and expanded Duty Free operations being unveiled across the Middle East,” says Milan. “We are confident our services will provide significant benefits to companies looking to streamline their operations and transform customers’ experience of their businesses,” he adds.

Analysts at IDC support Landsteinar’s supposition regarding the growth of technology adoption by the Middle East’s retail sector. A recent study by the research firm indicates that although the sector only accounted for 5.5% of ERP spending within the Middle East and North Africa (MENA) region last year, it is slated to grow at an impressive 14.7% compound annual growth rate (CAGR) through to 2007.

“IDC believes the ongoing expansion of the regional retail sector will lead to an augmentation of investments in ERP solutions in the sector over the next few years,” says Torben Pedersen, senior analyst, IDC Middle East & North Africa.

“Furthermore, the increasing competition in the retail space will lead to stronger investment in consumer-facing functions such as customer relationship management (CRM) and e-commerce solutions as companies seek to gain market share,” he adds.

Further evidence of the sector’s growth comes from the interest of other ERP providers, such as PeopleSoft/JDEdwards and Oracle, and vendors such IBM, which has enjoyed significant success with its POS solutions in the local market.

Whether these industry giants or market-specific vendors come to dominate the Middle East’s retail sector remains unclear, especially as the former often fails to fully address the niche areas of retailing, such as point of sale.

“My view is that they [ERP companies] are offering a comprehensive back office solution that deals very well with the retail environment, but they do not deliver a complete POS integrated with their products,” says Evan Powell, general manager for IT at Al Tayer Group, which uses JD Edwards One World as its back office application.

The most likely outcome, therefore, is that local retail operations will adopt a combination of both solutions. Instances of this happening already exist in the local market. For instance, Spinneys has worked with both SAP and Landsteiner in the local market to create its software infrastructure, while Al Tayer Group uses a heavily customised POS system that integrates with its One World suite.

“An ERP cannot do everything well and there is competitive advantage to adding custom functionality. [Therefore] a combination of the two - an ERP with an integrated specialist POS solution… is a powerful combination,” says Powell.

“This is the balance between the build versus buy scenario. One has to buy the core and build the unique,” he adds.

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