PerformanceRetail Sees $1 Billion Profit Growth Opportunity in Convenience Retail Market
Implementation of Web-Based Retail Performance Management Solutions Stands to Drive Increased Sales, Margins and Reduced Costs -- Delivering Opportunity for 30-50 Percent Gain to Retailers' Bottom Line
CHICAGO, IL -- (MARKET WIRE) -- 13-10-2003 --
The NACS Show -- In an industry fighting
decreasing margins, increasing costs and new competition from retail
goliaths such as Wal-Mart, convenience retailers can find new hope in $1
billion or more in potential additional profit. PerformanceRetail, Inc. the
leading provider of web-based software for the convenience retail industry
announced today projections of $1 billion or more in additional profit
opportunity available to retailers who put in place web-based retail
performance management solutions. The Austin, Texas-based company will
demonstrate how its web-based technology solutions can deliver the
opportunity for this growth at the National Association of Convenience
Stores (NACS) annual conference this week, in Chicago, at booth 5231.
According to the 2003 NACS State of the Industry Report, the 132,400
convenience stores in the United States generated $291 billion in total
sales for 2002, but delivered a meager $2.6 billion in pre-tax profit, a
decline of 24 percent from 2001 and a 45 percent decrease since 1999. On a
per-store basis, the average convenience store generated only $20,400 in
pre-tax profit on $2.3 million of total revenue, representing a significant
opportunity for improvement. These results have forced leading convenience
retailers to explore new imperatives to drive improved performance,
including replacing older systems technology, capturing and effectively
using item-level inventory, sales and margin data to drive merchandising
decisions, enabling proactive business visibility and intelligence and
streamlining operational processes to reduce costs.
"The convenience retail industry represents a significant percentage of the
worldwide retail business and a major part of consumers' everyday
experiences. The underperformance of this market over the last few years
stands to affect us all," said Marc Hafner, president and CEO of
PerformanceRetail, Inc. "Our work with customers over the past two years
has clearly shown the opportunity to replace antiquated systems technology
and drive significant improvement to the retailer's bottom line. We are
committed to continuing to provide innovative solutions that drive
increased performance for the convenience retail market and look forward to
working with retailers to deliver these results."
PerformanceRetail's InSite™ software solution, an integrated suite of
web-based merchandising and store operations applications provides enhanced
capabilities to improve retail performance and deliver the opportunity for
bottom line impact. Based on research and customer experience with the
InSite solution over the past two years, PerformanceRetail has identified
specific opportunities for revenue and margin improvement and for direct
expense reduction through the use of the software. Drivers of the
additional profit opportunity are centered on:
-- Increasing revenue through centralized price execution and control,
optimized product assortment and space utilization, fewer out-of-stock
items and optimized pricing and promotional activities.
-- Reducing product costs through more effective supply chain management
and better control of invoice exceptions.
-- Reducing operating expenses through streamlined ordering and receiving
processes, improved operational efficiencies, lowered shrink and waste and
optimized inventory management processes.
-- Reducing overall cost of technology ownership through centralized
control, a minimized technology footprint, lowered customization and
maintenance costs and the replacement of existing antiquated technology
with modern, web-based solutions.
PerformanceRetail estimates that these factors can drive as much as a 30-50
percent improvement to a retailer's bottom-line. Across the convenience
retail industry in the United States alone, the accelerated valuation
creation opportunity represents minimally $1 billion, an impressive 38
percent on top of the industry's 2002 $2.6 billion total pre-tax profit,
with an opportunity to drive additional profits as retailers continue to
improve their merchandising and operational processes. Additionally, the
efficiencies and cost reduction potential driven by these factors gives
retailers increased flexibility to enhance their competitive position by
passing along savings, improved product assortment and enhanced service to
consumers.
About PerformanceRetail
PerformanceRetail is the leading provider of web-based software for the
convenience retailing industry. InSite, the company's integrated suite of
retail software applications, enables retailers to improve the
profitability and efficiency of key business processes such as
merchandising, site operations, fuel management, performance analysis and
financials. PerformanceRetail's modular, hosted solutions and comprehensive
services ensure customers realize value quickly while reducing upfront
capital expenditures and ongoing support costs. By partnering with
PerformanceRetail, industry leaders are transforming their retail
operations into highly competitive, customer-driven profit centers. For
more information, visit www.performanceretail.com.
CONTACT:
Dean Cruse
512.527.6513
PerformanceRetail, Inc.
dean_cruse@performanceretail.com
David Lord
512.335.8771 ext. 13
Blanc & Otus Public Relations
dlord@blancandotus.com
