Coles ramps up digital transformation march with trade platform play

Coles Group is sinking its teeth into supply chain management and core finance and procurement platforms – GT Nexus – in a bid to beef up its ‘smarter selling’ strategy and accelerate its digital transformation push.

Essentially, the retail giant has migrated its legacy core finance system to the SAP S/4HANA platform, improving the speed and stability of Coles’ financial systems, Coles said. This has also enabled the deployment of the SAP Ariba procurement solution.

Coles will implement the GT Nexus solution next year, the first organisation in Australia to directly do so. According to the company, the trade platform, built by global enterprise company Infor, will streamline imports, reduce costs and modernise Coles’ international supply chain.

The goal is to improve product availability for customers while enabling efficiencies in supply chain to support Coles’ smarter selling strategy.

Coles said the combination of SAP Ariba and S/4HANA will enable significant cost savings in procurement by centralising management of purchasing for goods not for resale, allowing for consolidation of suppliers and improved trading terms.

“We have committed to being technology-led in our stores and throughout our supply chain to reduce costs while delivering an even better shopping experience for customers and making life easier for our team members, GT Nexus is another investment in this,” Coles chief information and digital officer, Roger Sniezek, said in a statement.

“We have leveraged our strategic partnership with Microsoft to implement SAP S/4HANA in the Azure cloud. This gave us significant agility through the implementation project and was a key enabler of the short timeline. The development work Coles will need to undertake to integrate into the GT Nexus platform will also be hosted in Azure.

“For SAP Ariba, Accenture were our key implementation partner, again leveraging our strategic partnership. By working together with all our global partners, we are seeing clearly that we are able to deliver our strategy at pace.”

Coles chief financial officer, Leah Weckert, said the implementation of the two SAP platforms was an important milestone in the continued modernisation of Coles’ systems, which would enable the delivery of future transformation projects and support ongoing improvement in business processes.

“We had a very ambitious five-month timeline to implement SAP S/4HANA and we adopted a very innovative implementation approach with specialist partner Acclimation, utilising a toolset from SNP.

“This was a remarkable collaboration between the finance and technology teams. SAP Ariba was also implemented at pace and is fundamentally changing how Coles purchases goods not for resale right across the business. It’s a foundational part of our Smarter Selling strategy,” Weckert said in a statement.

Coles executive general manager operations and transformation, Kevin Gunn, said the GT Nexus platform would enable real time visibility of international stock.

“Availability is a key issue for customers and some popular items, such as light globes, herbs and spices and kitchen essentials like foil and garbage bags, cannot be sourced domestically so we need to look to international suppliers,” Gunn said.

“By understanding where our stock is while in transit, we can better plan our stock movements to enhance availability for customers and reduce the time taken to move products into our stores, improving our use of working capital by reducing the time inventory spends in our supply chain.

“It will also support improved efficiencies through the supply chain by minimising the need to move stock between states, resulting in fewer truck movements which will also improve road safety and reduce carbon emissions.”