ANDRONICO'S TO CREATE SYNERGY BETWEEN FINANCIAL, SUPPLY CHAIN

KIM ANN ZIMMERMANN

ALBANY, Calif. -- Andronico's Market here is preparing to install new financial and supply-chain management software that, among other benefits, is expected to ease the flow of data between stores and headquarters, -- particularly information concerning receipt of direct-store-deliveries from vendors.

The new financial software is expected to go live in August. The procurement application, which will handle inventory-management, purchasing and warehouse-management functions, is expected to be installed in the fourth quarter. The financial and procurement systems will be integrated to allow for quick and detailed analysis of costs in the supply chain.

The flow of information related to DSD is particularly important as Andronico's moves forward with its scan-based-trading pilot. In SBT programs, manufacturers who supply the retailer via DSD maintain ownership of their inventory until it actually moves across the point of sale.

"All these activities are connected, and this will enable us to get a complete and accurate look at our business," said Mike Miller, director of information systems. "We needed to reduce the amount of paper and data handling. We have a growing business, and it is growing more complicated. Each aspect of our business is not a separate activity. The information needs to flow through from one department within the company to another and to our partners," he said.

The system will also handle the processing of orders placed through Peapod, Skokie, Ill., the Internet-based home-delivery service. Last month the retailer began working with Peapod to provide its customers with premium produce, high-end meat, fish and poultry, fresh bakery goods and prepared foods.

All the software applications, which will also include human resources and payroll, are from Lawson Software, Minneapolis.

"Our selection requirements included gaining improved efficiencies with financial integration, plus controlling costs," noted Merlin L. Stigge, chief financial officer and vice president of finance. "The system's enhanced functionality, including its Web capabilities and ease of use, will allow us to automate many of our once manual activities at a cost savings," he noted.

Miller said the system will further automate the processing of invoices from vendors who deliver directly to the stores. Currently, the stores send the paperwork to headquarters for processing after the receipt of a delivery from a vendor.

Once the new system is in place, information will be entered into the retailer's store-receiving and point-of-sale software from Bass Inc., Miamisburg, Ohio, which will upload the data to the financial and supply-chain management systems.

Miller said another key area where the software will help reduce paperwork will be in the management of the company's orders from Peapod.

"Currently, we're handling the management of all business involved in picking orders and processing invoices from Peapod with spreadsheets," Miller said.

As part of the initiative, the retailer is upgrading its human-resources and payroll software.

The human-resources system is expected to be up and running in time for the opening of a new store in Danville, Calif., in mid-August.

"We chose the payroll software to satisfy our need for a Y2K-compliant payroll system that could handle our numerous union pay and overtime pay plans in addition to our multiple earnings codes," the retailer said. "We were also looking for a complete, integrated solution to automate the addition of employees and stores to our organization, while capitalizing on enhanced reporting capabilities."