Circuit City Set for In-store Technology Transformation

Retailer deploying new point-of-sale system, wireless devices, data warehousing solution to boost customer service

Retailer deploying new point-of-sale system, wireless devices, data warehousing solution to boost customer service

Richmond, VA — August 11, 2004 — Circuit City Stores has launched a technology transformation project in conjunction with IBM in order to update point-of-sale (POS) and other in-store systems with the goal of making the electronics retailer's 600-plus outlets the most advanced in the retail industry.

The new technologies include solutions from IBM, 360Commerce and Yantra.

IBM is supplying its SurePOS 300 POS systems and secure wireless handheld POS systems based on the IBM Store Integration Framework and the open-source Linux operating system. Circuit City also will use IBM Business Consulting Services to help plan the transformation.

360Commerce brings a POS application to support Circuit City's complex selling environment. Its Java-based application suite includes POS, Back Office, Central Office and Workforce Management.

Yantra is providing a process engine and application suite, complementing Circuit City's core POS application. The Yantra applications will be used to create enterprise services for order management and to support Circuit City's Express Pickup order fulfillment, store inventory control, product repair processing and product delivery and installation. Both 360Commerce and Yantra are IBM Business Partners.

These in-store systems will be coupled with new data warehousing capabilities, based on IBM eServer pSeries hardware and IBM DB2 database software. The new data warehousing capabilities are intended to improve internal processes, streamline applications and allow Circuit City to better view and analyze data from all parts of the company, including POS and

IBM said that Circuit City, by employing the IBM Retail Environment for SUSE Linux at the point of sale, will have the flexibility and reliability of open standards, enabling the retailer to adapt quickly to changes in the retail marketplace and to cost-effectively institute future upgrades to the platform.

"This new technology initiative, a vital part of our store revitalization effort, will move our store systems from customized, proprietary systems to a system based on open standards," said Michael Jones, chief information officer of Circuit City. "Our current POS systems, which contain a feature set designed in the mid-1980s, are overly complex and restrict our business expansion. The new systems will allow us to adopt leading practices and improve store systems integration while optimizing store infrastructure costs."

"When a retailer can combine the latest technology with a superior business vision and new processes, as Circuit City is doing, then they can increase flexibility and efficiency, as well as transform their store operations and the in-store shopping experience," said Steve Valentine, a retail consulting executive at IBM. "The world's best retailers are leveraging this powerful new technology and will be able to create new levels of business efficiency, customer satisfaction and customer loyalty. Circuit City is on the leading edge of this new trend."

The rollout to all stores is scheduled to start in March 2005 and is expected to be completed by the end of February 2006. Circuit City said that it expects that the POS changes will not result in any material write-offs, nor will it materially affect planned spending on store systems.

"The IBM Store Integration Framework allows for customized combinations of IBM middleware solutions with specialized applications from IBM's network of independent software vendors and industry-specific services to allow a retailer to be more responsive to business opportunities and customer demands," IBM said in a statement.