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Industry News - March 20th, 2009



SAP and Sybase Co-Innovate to Mobilize SAP Business Suite 7

SAP and Sybase announce that both companies are co-innovating and collaborating to deliver the new SAP Business Suite software for the first time to iPhone, Windows Mobile, BlackBerry and other devices by integrating it with Sybase's mobile enterprise application platform.

The use of mobile devices in the workplace is growing rapidly; today's workforce requires easy access to information while on the road or working from home, and they want the flexibility to use the device of their choice. Together, SAP and Sybase will enable enterprise software users worldwide access to secure, full-featured, business applications on the go. Companies can extend workforce productivity outside of the office by allowing employees to make informative and timely business decisions anytime and anyplace on a wide range of mobile devices.

Through the partnership, users will have access to critical customer data in both connected and disconnected modes right from their mobile device of choice by utilizing Sybase's business process mobilization technology. Sybase will work together with SAP to simplify the delivery of enterprise applications to mobile devices to speed up rollout and reduce end-user training for sales representatives and service personnel.

Mobile workers will now have the tools they need to take immediate action on routine operational tasks regardless of their location. Sybase will help sales professionals access to the SAP customer relationship management (CRM) solution. While on the move they will be equipped with up-to-the-minute data on their customers that is synchronized with the enterprise applications, allowing the execution of customer transactions as well as integration with mobile business processes.

T-Systems, a large systems integrator in Europe, will work closely with Sybase to enable SAP end-users to take advantage of easy access to the new SAP Business Suite and mobile business processes and applications.


Walgreens Doubles Distribution Center Capacity

Walgreens expands the Kiva system in its Mt. Vernon, Illinois facility for the third time since its initial deployment in 2007. A key motivation for choosing Kiva for expansion of the Mt. Vernon facility was Kiva's productivity advantage over the existing conveyor system. Walgreens uses the Kiva Mobile Fulfillment System (MFS) to store inventory and pick replenishment orders for its retail stores.

Walgreens is using the current expansion to both double the capacity of their Mt. Vernon distribution center and convert many of their traditional conveyor-based zone picking areas into Kiva zones. This expanded system puts nearly 1,000 mobile robots under a single roof.
Uncertainty about the direction of the economy was also an important factor in the decision to add more Kiva order fulfillment equipment. The portable nature of the mobile fulfillment system helps Walgreens expand the Mt. Vernon facility now, yet retain the option to easily redeploy the system to a different location if economic factors change.


Zale to Close 115 Underperforming Stores

Jewelry company Zale Corp. says it plans to close 115 underperforming stories and cut 245 jobs after posting a net loss for the second quarter of 2009, which ended January 31.

The company said it expects to save about $34 million in expenses through fiscal 2010 by closing about 115 underperforming stores, which will be closed as leases mature.
The company plans to slash $175 million from its budget through cost and inventory reductions, including the elimination of 245 jobs. Of those job cuts, 75 were unfilled positions, according to the company.

Dallas-based Zale Corp. posted a loss of $23.6 million, down from a profit of $60.8 million during the same quarter last year. The company attributes its loss partly to charges related to goodwill impairments and $5 million in expenses tied to store impairments.

Sales during the quarter hit $679 million, a 17.9 percent decline from $828 million the year-ago period.

Neal Goldberg, the company's CEO, said Zale's operating results were impacted negatively by the struggling economy, as well as a drop in gross margin


Nordstrom to Open 10 Discount Rack Stores

Seattle-based Nordstrom, an upscale retailer, is banking on its discount Rack stores to help it drive sales. In 2009, Nordstrom plans to open 10 discount Rack stores, out of 13 new stores overall.

The emphasis on opening more Racks is part of Nordstrom’s strategy to navigate a serious economic downturn that has erased jobs and personal wealth, and eroded consumer confidence. Nordstrom executives say it makes sense to emphasize value and savings, even for a company that prides itself on its customer service and caters to shoppers looking for designer and luxury clothing, shoes and cosmetics.

Nordstrom also was sharpening prices and passing on more savings to customers. For example, it lowered prices by an average of 22 percent on hundreds of the most popular styles in Nordstrom’s full-line department stores.

But Nordstrom also is mindful of the draw of its discount Rack stores, which make up a third of the company’s stores in 28 states.

For 2008, sales at full-line Nordstrom stores open a year or more dropped 12.4 percent on a year-over-year comparison. Meanwhile, comparative store sales at Nordstrom Rack stores were up 3 percent for the year.

Publicly traded Nordstrom’s overall net sales for its most recent reported quarter were down 8 percent in a year-over-year comparison. The company remains healthy and profitable, although net earnings for the quarter were down 57 percent.

Nordstrom has enjoyed strong sales growth in its Rack stores each year since 2002. This year Nordstrom is adding Rack stores in markets that include Dallas, Los Angeles, Pasadena and Orlando. Rack store growth planned for 2009 will increase the number of these discount stores by about 15 percent.


eBays New Strategy: What Was Once Old is New Again

At Web giant eBay, it's out with the new and in with the old both in terms of corporate strategy and product mix. After trying in vain to remake itself as an online retailer of fixed-priced items to rival the likes of Amazon.com and Wal-Mart, eBay last week cried uncle when it announced it was returning to its roots as an auction clearinghouse for used goods and collectables (in addition to overstocked items). Why the change? The past year has not been kind on the one-time darling of the Web which has seen its traffic and fortunes decline.

To compete in the fixed-price marketplace, eBay enacted a series of policies and site changes that favored power sellers at the expense of smaller sellers. As casual sellers abandoned the site, buyers have migrated elsewhere in search of the hard-to-find products upon which eBay built its business traffic to Craigslist has risen 40% over the past year. In contrast, eBay's traffic was down 5.2% last month over the previous year, while Amazon's traffic rose 18.7%.

Not only are fewer shoppers returning to the site, but average order values have stagnated at around $28 (other than the spike during the holiday season.) Since eBay's marketplace revenues are driven by fees charged to sellers, declining traffic and flat transaction values have led eBay to raise its fees in hopes of meeting Wall Street's expectations. As a result, eBay is squeezing the very sellers on whose backs the success of its business rests.

The more eBay has tried to be a retailer, the more its customers have gravitated to sites offering better overall shopping experiences with lower total prices, better customer service, and predictable deliveries; not to mention the avoidance of the risk of fraud. The percentage of eBay’s visitors who shopped at Amazon jumped from 41% in February 2008 to 53% last month. Over the same period, Amazon visitors' cross-shopping of eBay has remained unchanged at 58%, suggesting eBay's fixed-price strategy has failed to attract significant numbers of new shoppers to the site.

By focusing so much on fixed-priced items sold by large sellers, eBay has blurred the distinction between it and the litany of shopping comparison sites and tools on the web (such as shopping.com which eBay also owns). In so doing, eBay has traded away much of the brand equity that once set it apart from the rest of the online retailing universe.


Datalogic Scanning Unveils Cordless PowerScan Rugged Imager

Datalogic Scanning releases PowerScan PBT7100 industrial handheld linear imager. This new imager is designed for users that require a snappy, rugged and durable handheld cordless scanner and features an ergonomic IP65 rated enclosure. The PowerScan portfolio offers a premium and a value line, laser or linear imaging and corded or wireless technologies.

Datalogic's 'Green Spot' technology helps improve the user's experience and increases the speed of scanning operations. The PowerScan PBT7100 imager is a ruggedized product, with no moving parts. An over molded case covers likely drop points; prevents the scanner from slipping off counters; resists multiple drops, strong shocks and repetitive tumbles; adding extra protection.

A decoder reads up to 390 scans per second, making it ideal for sorting, postal and logistic applications. The PowerScan PBT7100 imager also can decode hard-to-read, poorly printed and even damaged bar codes, increasing effectiveness and efficiency.

With a Bluetooth wireless technology 2.0 Class 1 radio, this product is designed for fast cordless data capture allowing mobility over a very large workspace - up to 100 m / 328 ft.- and memory storage for out-of-range transactions.

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