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Farmacias Ahumada Improves Pricing via SaaS

BY CSA STAFF

Farmacias Ahumada S.A. (FASA), Latin America’s largest drug chain, is adding a pricing solution using a software-as-a-service business model.

Santiago, Chile-based FASA wanted to execute a consistent pricing strategy that could help the company improve its price image among shoppers. FASA also wanted to improve forecasting based on a quantified understanding of consumer demand. By tapping San Jose, Calif.-based DemandTec, FASA added DemandTec Price to help it set strategic prices, as well as support trading-partner collaboration.

Rather than purchase the software, however, FASA chose a SaaS contract. Called the wave of the future, SaaS software is obtained via a subscription. This eliminates the need for retailers to pay for periodic upgrades.

The SaaS model entitles retailers to all upgrades during the term of the subscription. When the subscription period expires however, the software is no longer valid.

“It was the SaaS business model, as well as an intuitive user interface and a solid platform that convinced us to choose this pricing solution,” said Jaime Trewik, commercial planning and strategic pricing manager for FASA.

FASA, which began using the solution in January, is initially using the solution to optimize prices for new items, promoted and regular merchandise.

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Lampert, the Eli Manning of retail?

BY CSA STAFF

HOFFMAN ESTATES, Ill. The New York Giants triumph over the highly favored New England Patriots in the Super Bowl earlier this month, has become an example of coming from the bottom to win it all. Sears Holdings chairman Edward Lampert is one of the latest to use the Giants win, even going as far to compare himself, and the leaders of his company, to quarterback Eli Manning.

The Giants analogy, and Eli Manning comparison, is applied mainly to the company’s Kmart division. In a letter to investors, posted on the Sears Holdings investor relations Web site, Lampert said during Kmart’s bankruptcy in 2002, the unit was “like an undrafted free agent who nobody thought had a chance to play in the big leagues.” Lampert went on to say, “Like Eli Manning, we know what it’s like to be underestimated and questioned, but we intend to keep working on our game to achieve our full potential.”

Sears Holdings reported net income of $426 million, or $3.17 per diluted share, for the fourth quarter ended Feb. 2, compared with net income of $811 million, or $5.27 per diluted share, for the fourth quarter ended Feb. 3, 2007. For the fiscal year ended Feb. 2, 2008, net income was $826 million, or $5.70 per diluted share compared with net income of $1.5 billion, or $9.58 per diluted share, for the fiscal year ended Feb. 3, 2007.

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Circuit City investor seeks to replace board

BY CSA STAFF

RICHMOND, Va. Circuit City Stores today acknowledged that it has received two proposals from shareholder Wattles Capital Management regarding its board of directors. Wattles holds approximately 6.5% of the outstanding shares of the company’s common stock.

Circuit City reported that Wattles proposed the idea of replacing the company’s Circuit City 12-member board of directors with its own nominees. Circuit City said its board of directors will review carefully the shareholder’s proposals and the qualifications of the nominees in accordance with its fiduciary duties, mindful that the proposal would give the shareholder absolute control of the entire board, which would be disproportionate to its relative ownership of the company’s shares.

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