Saudi Food & Drug Authority (SFDA)     

Established in 2003, the SFDA aims at “Protecting the community through regulations and effective controls to ensure the safety of food, drugs, medical devices, cosmetics, pesticides and feed”. What this means is that if a product falls under SFDA’s authority then it needs to meet their regulations such as quality control and packaging. Essentially, the Saudi Food and Drug Authority sets the safety requirements for goods to be imported and sold within the country. 

It runs its own online portal which has many different eservice branches attached to it, depending on whether food or drug is being looked at. In these portals, importers can enter manufacturer information and upload relevant documents which allow SFDA to confirm safety and quality standards and issue a notification number that confirms a certain good/product can be sold in the Kingdom of Saudi Arabia.   

Saudi Standards, Metrology and Quality Organization (SASO)

Initiated in 1972, SASO is a regulatory body focused on designing and approving national standards for goods, products, and services. It issues additional regulations and requires further documentation to ensure goods, products, and services are entering the market under approved standards. 

Further, SASO is the issuing authority when it comes to ensuring goods entering or exiting the Kingdom are correctly certified and upto the different relevant standards and regulations. To do this, SASO has implemented the Saber system which aims to accelerate delivery of the required conformity certificates for consumer products. 

Saber

Marketed as “Your gateway to the Saudi market”, Saber is an online portal to register products and easily obtain certificates of conformity. Where SASO issues advice regarding regulations and documentation, Saber is how these things are implemented and checked. After creating a profile, a seller can enter the product they are importing and gain the correct authorizations to quickly pass through customs.  

FASAH

Backed by Saudi customs, FASAH is the online portal used at customs. A retailer will upload documents received by SFDA, SASO and Saber onto their FASAH profile. These will then be seen by officers at customs which will expedite the releasing process.

Chameleon ERP is a business software that optimizes customs clearance and other processes. To learn more, visit https://chameleonerp.com/customsclearance-2/ 

To avoid both scenarios, you need to have proper control of what’s coming in and what’s going out of your stores. Moreover, you want to know what your customers want and whether you are adequately providing them with it. 

Reasons behind overstocking/understocking:

• Bad processes 
• Bad Training
• Disconnected data
• Supplier issues including pricing

How to get inventory Right

1. Forecast Sales based on Historical Data – Great inventory management comes down to accurate demand forecasting. If you can predict sales, you can prepare accordingly.
2. Listen to the market – Track search trends to assess demand for your overall product category. By monitoring buyers’ search habits, you can determine if general interest in your products is increasing or decreasing and then adjust inventory.
3. Centralize Data – Avoid working on multiple spreadsheets, this will just get confusing. By monitoring stock from a single point, you can quickly determine when you need to restock inventory to fulfill orders.
4. Apply ABC analysis. This allows you to prioritize your most important items.

A: High-value products that represent a small portion of the total inventory

B: Moderate-value products that represent a decent portion of the total inventory

C: Low-value products that represent the majority of the total inventory

5. Analyze inter-departmental communication. It is essential that your supply chain flow smoothly with as few errors as possible. This is only possible when different departments are talking to each other and know what’s going on. 

6. Analyze Vendor Relationships and determine if there is an issue with your suppliers.

The most common issue is slow moving and excess inventory. This usually happens at the beginning of the year and end of a season when new products are demanded. It is better to clear your stock as opposed to clinging on to these items hoping that someone will suddenly buy them.

Here are some things to consider when discussing slow-moving and excess inventory:

• Cash is King 

Your business needs a healthy cash flow. As such, selling an item at a low margin or even a loss can be better than taking up shelf space.   

• Sell by 90 – 120 days

If items have not been sold within this timespan, find ways to get rid of them. 

• Hoarding hurts

The opportunity cost of keeping a slow-moving item is the possibility of stocking an in-demand item.   

• You are not alone

All retailers deal with slow-moving and excess inventory. If they can handle it, so can you!

With that, here are some great ways to convert slow moving inventory. 

Sales + Discounts

Popular and proven, cut the price and create demand for the good. You can try anywhere from 35 to 70% which seems like a lot but remember these items need to go. Examples of different sale types:

• Clearance sale
• Flash sale
• Seasonal sale
• Specific item sale

Bundle offers + Promotions 

Another popular option, bundling is when you take a group of products and sell them together for a slightly lower price than if they were sold separately, for eg meal combos at fast food restaurants. You protect your margin while moving merchandise. Examples of different bundling types:

• Bundle multiple units of the same product
• Pair slow-moving products with fast-moving products 
• Pair with complementary products

While there should be a prior contractual understanding, there is the possibility that the suppliers can facilitate returns or exchanges. Once the excess inventory is someone else’s problem, it is wise to analyze why the item was a slow mover, was it wrong for your market? Was it over priced? Under priced? Would you, in different circumstances, buy it again? What would you replace it with? 

Research shows us that customers’ buying decisions are heavily impacted by their retail experience. A majority of people make buying decisions in store rather than before. Fully stocking shelves encourages customers to buy more. Shelf management tools such as drop-in pushers or shelf-dividers make your shelves always appear fully stocked and encourage a healthy shopping environment. Generally speaking, products displayed on shelves at eye level have higher sales than those on the bottom or top shelves. Also, products with brand labels facing forwards, towards customers, generate more sales. 

Customers love shops that are easy to navigate and friendly to shop in and basically want their favorite brands at competitive prices. The key to any retail shop’s success is correctly placing a product on the shelf. There are several strategies for product placement such as grouping items by brand to make it easier for consumers to compare. Another strategy is to organize your store to match the walking pattern of 60-70% of your customers and place items accordingly. This is why frozen items and ice creams are found near the end of supermarkets.   

Product assortment is another factor of shelf management. Customers not only look for popular or top items, they also want specialty or niche items that match their needs. This means your store needs to have a variety of items without much duplication. Too few items may anger customers while too many items may cause confusion. A solid mix includes top-selling goods as well as specialty items for niche customers. 

Some retailers find more profitability in sacrificing shelf space to make room for other services. Some music stores, for instance, sell instruments and also provide educational services like learning how to play a guitar. These classes are usually done in store in a section that could be used to display more merchandise. Staples in Canada, an office retail company, dedicates 25-45% of its store to short-term office rentals. They come equipped with fully-loaded board rooms and presentation rooms which has resulted in an increase in Staples’ revenue per store.     

A Point of Sale system or POS is the modern equivalent of an Electronic Cash Register (ECR) and a credit card terminal. It can be used by any type of business regardless of size or type. Directly or indirectly, they cover every area of a business. They can make all aspects of day-to-day running more efficient and profitable, from stock ordering to post-sale, targeted marketing. Also, these systems are now truly cost-effective and easy to use.   

A POS system is made up of 2 components – hardware and software. While the physical machine is important and works like an ECR, a Point of Sale’s true advantage lies in its ability to capture, store, and analyze sales and purchase data ie the software. 

POS solutions positively impact your bottom line as they increase efficiency and productivity, save time, and lower your cost of doing business. They also manage inventory and provide detailed reports to improve on customer and vendor relationships. Upgrading from an ECR to a POS results in a solid return on investment (ROI), both in terms of cost and business intelligence.

Benefits of a POS

• Lower Overhead

With automation in place, you may not need as many employees in your store.

• Increase store profitability

Effective inventory management with accurate buyer behaviour information can facilitate personalised and targeted marketing campaigns.

• Expanded Payment Capabilities

Customers like having payment options. POS also include the ability to diverse payments types such as EMV chip cards, contactless payments (NFC), and mobile wallet payments such as Apple Pay, Android Pay, and Samsung Pay. In one fell swoop, you can boost sales and customer satisfaction. 

• Increased Efficiency and Greater Accuracy

Built-in time management features improve productivity while less time is spent correcting errors.

• Inventory Management

Unlike cash registers, POS systems have advanced features letting you manage inventory efficiently. These systems provide essential inventory data which is not available with cash registers.

• Ease of Use

Given the popularity and accessibility of touchscreens, learning a POS system is simple especially ones with intuitive interfaces. The software is easy to learn which means less training time and more time to be productive.

• Detailed Receipts and Reporting

Most POS systems compile different customizable reports including daily sales figures, stock updates, and profit and expenses. Through these reports, you can see sales trends such as which products are in demand, allowing you to organize your stock before or after a particular season. Most importantly, these reports will allow you to identify areas where you won’t need to spend a lot of money.

Coming up with the right strategy for you boils down to your individual business situation or problem. It requires research, carefully calculated plans, and executing them effectively. The results must always be recorded so they can be compared against the set goals and contribute to future growth. 

Over time, these results can help anticipate future trends of the company and environment. These frameworks also allow us to calculate the impact of any action on the overall goals of the company. 

Porter’s 5 Forces

Porter’s Five Forces takes into account not just the company itself, but also the external environment including customers, rival businesses, and potential threats.

Rivalry among competitors represents the current players within the industry. Competition can be ruthless in some industries, while in others, competitors may have mutual goals. The higher the rivalry among competitors, the higher the risk or difficulty in operating in this industry. 

Bargaining power of Buyers refers to the importance of the buyer or customer in the industry. Although the buyer is always important, their bargaining power may vary depending on the nature of business and industry. The higher the buying power of the buyer, the more difficult it will be to operate since they will always demand higher quality and service for the lowest cost. 

Bargaining power of Suppliers is the amount of power held by the providers of the raw materials or other items necessary for you to operate. The higher their buying power, the more influence they will have on all businesses operating in the market.

Threat from new entrants refers to the increased competition and friction that could arise when new players enter the market. This takes into account factors such as the barriers to entry for new players, as well as the economies of scale enjoyed by existing players. 

Finally, threat of substitute products refers to the availability of similar products or services in the market which might fulfill the same needs as your product. These substitutes are a threat because consumers will have the option to switch from your product to another that is readily available in the market. 

Once you have identified the five forces, you assign a value to each such as Low, Medium, or High. Let’s say you want to assign a value to the rivalry from competitors in your industry. If there are a lot of businesses offering the same product or service as you, and there is tough competition, then rivalry from competitors is high. If there are few or no other competitors or if you enjoy a monopoly, then there is low rivalry. 

Porter’s Five Forces model works when you look at all the five forces and carefully analyze the situation to come up with the best strategy.

SWOT Analysis

SWOT is an acronym for Strengths, Weaknesses, Opportunities, and Threats. The framework analyzes your business from these four angles to determine the best course of action. Strengths and Weaknesses deal with the company’s internal situation, while the Opportunities and Threats are external.

Strengths are the characteristics of your business which give you an advantage over your competition. As the name suggests, this includes things you can do better or faster or any special resources or assets you have that others don’t. 

Weaknesses include your shortcomings, as well as any strengths of your rivals. By studying and analyzing your weaknesses, you will learn of any limitations your business may have, and your areas of improvement. 

Opportunities often present themselves in the business industry, and it is up to the strategy manager to help identify any avenues where the business can get an advantage. This includes any emerging trends or unfulfilled needs of the market. It can also include the effects of marketing activities or publicity for your company.

Threats are always present in business and must be taken into account, to mitigate any risks beforehand. Threats can be of many types, and are often not in our direct control. They could include a governmental action or law that hinders business activities, or the arrival of a new product which is better than your own. 

Balanced Scorecard

The Balanced Scorecard measures various aspects of the business and gives them a score or rating. It is generally used for identifying strengths and weaknesses, and for improvement of processes. The four main parts of a Balanced Scorecard are the Financials, the Customer, the Internal Processes, and Learning and Growth. In the center, we have vision and strategy.

For financials, you should analyze your sales, revenues, costs, cash flow etc. In other words, you want to find out how healthy your company is in terms of financials. 

For customers, you should know what they think of your product and how satisfied they are. This will require research and collecting feedback from your customers. 

The internal business process refers to the methods used in your company to provide the product and service to your customers. These processes must be efficient, and there should not be any wastage of time or resources.

Finally, learning and growth deals with training and improvement of the staff and processes. It involves applying knowledge and new research to your company’s growth, and creating value out of new information quickly and seamlessly.

For each of the above parameters, you have to define your objectives, decide on the measures you are going to take, set your targets, and list down the initiatives.  

Launching an e-commerce operation requires lower capital as you save on overhead costs such as store lease, on-site staff, warehousing or space for inventory, etc. It is also more accessible to the wider public giving you more sales options. Ideally, some of these “saved” costs would be invested on a solid digital marketing strategy that leverages a website, social media, and Google.     

It’s not all doom and gloom for brick and mortar stores though. Research has consistently shown that customers prefer touching the product and the instant gratification factor stores offer. Further, there are some products and services that are just difficult to upsell or sell online. Finally, never underestimate the power of customer loyalty. Many users return to a business because they received good service and felt positively after their experience.  

For a successful store in modern times, you will have to pick the right location taking into account factors like store surroundings and accessibility. Also, you will have to invest in the best quality store staff. They have to be more like brand ambassadors than sales people. This is because many people have done online research into the product and are better informed than before. 

The contemporary trend in tech e-retail is now in fact offline stores! Amazon kicked things off in 2015 with a bookstore and since then the internet Behemoth has made $1.3 billion from in-person sales. Another popular trend is pop-up shops. These are little kiosks or test shops that are often a viral hit, spark brand awareness, and generate sales while keeping costs minimal.   

So now should you invest online or offline? Both, an omnichannel sales model is how to survive in the modern day business world. An omnichannel method just means using multiple ways or mediums to make sales. So, ideally you would have both a web presence and a physical one. This will allow you to satisfy your local users while also staying on the lookout for other prospects.    

Return On Investment: 

• Adapted to changing requirements fueled by growth and operational overhaul 
• Maintained company’s lean model via cloud technology and remote access
• Integrated nature of software resulted in more efficient use of company resources such as time and energy  
• Systematic value additions such as prepopulated T&Cs increased operational efficiency and reduced wastage   

Brief Summary:

Started as an experiment at a founder’s house, Diggn’It soon found itself growing in positive demand. This led the founders’ to pursue the company seriously and invest and grow its operational capacity.  

With basic information about raw materials and procurement, Chameleon gave the Diggn’ It team quick and accurate production and cost schedules. This information made it easy to consider margins, set retail prices, track purchases, and manage accounting. The ease of the software allowed Diggn’ It to organize streamlined, scalable business processes while saving invaluable time, energy, resources, and focus.    

The Need:

Ever-evolving operational processes require a flexible, adaptable business software.   

As a growing startup, Diggn’ It needed to formalize its operations. They needed to be recorded, tracked, and analyzed. Furthermore, the data had to be remotely accessible to maintain the company’s lean model and global workforce. 

Essentially, Diggn’ It desired a centralized, integrated backbone that would allow the team to expend their time and resources on growth, customer satisfaction, and an expanding product line.

Chameleon was perfect for a startup like Diggn’It given the software’s mix of features and benefits: 

• Adaptable

The grooming company’s processes were still being developed and would undergo further change. They required a software that could easily evolve in tow.  

• Cloud based

Cloud-enabled software would support the startup’s online, remote, and agile nature.  

• Integrated & Centralized

Decision making becomes easy when you know your position. Storing all the relevant data and information in one repository streamlines the team’s thought process and results in an informed outcome.     

• Bilingual

As an Arabian company, Diggn’ It’s workforce is comprised of English and Arabic speakers. 

• Easy to learn 

  Members of different departments would be inputting information. This meant the software had to be easy to use, teach, and learn.       

The Solution & Results:

A versatile business software that empowered Diggn’ It to go from idea to multi-national influencer.

Chameleon provided the digital backbone that allowed Diggn’ It to easily track and analyze the business. Automation and digitization made the transition from home manufacturing to an outsourced supplier easy, effective, and efficient. As a result, the Diggn’ It team was able to focus their efforts on social media and general marketing. Without an integrated accounting and manufacturing system, it would have been difficult to balance inventory levels of supplies and track sales. This became especially crucial in 2018 when Saudi Arabia instituted VAT policies that required auditable receipts, invoices, and purchase orders. 

Chameleon’s value-add was immediate and across the board:

• Increased accounting operations and reporting was becoming time consuming and prone to errors

As the company grew, so did its accounting and bookkeeping operations. To save time and avoid unnecessary errors, Diggn’It thought it prudent to integrate a software module to handle accounting, financing, and reporting. It needed to be accessible by an external accountant and create organized files and folders to be easily searched, filtered, or sorted through.       

• Growing, uncoordinated operations threatened the lean model 

Expanding processes were threatening Diggn’ It’s lean model. The Diggn’ It team debated increasing headcount to handle the new operations but this option was undesirable as it was costly, did not ensure a streamlined process, and would deflect focus away from growing the business.   

• Less time and energy to focus on consumer engagement and marketing

As a social startup, consumer engagement, PR, and marketing are crucial for Diggn’It’s success and growth. The more time spent on backend operation, the less time management could spend creating content, marketing, and advertising. 

• Difficulty scaling to support growing sales channels

A digital system allowed Diggn’It to serve domestic and foreign distributors and customers quickly and easily. The system handled multiple currencies and tracked the supply chain with ease letting the Diggn’ It team focus on core tasks.  

Conclusion:   

Expanding product offerings, serving more markets and retailers, and achieving the highest level of customer engagement and satisfaction are just some of the many areas Diggn’ It is succeeding at today. Their results demonstrate the importance of a backend system that can scale and adapt to changing business operations. A flexible, integrated ERP system improved productivity, reduced errors, and provided a backend structure that streamlined Diggn’ It’s business processes while staying lean. This allowed the team to concentrate on marketing, social media, sales, customers, and growth.  

In 1822, an English mathematician named Charles Babbage conceived of a steam-driven machine that could calculate and compute tables of numbers. The project was funded by the English government but ended in failure. Despite the lack of success, history looks back at this effort as the first attempt at building a physical computer. He articulated concepts still used today including the idea of separating storage from processing, the logical structure of computers, and the way data and instructions are inputted and outputted.

Herman Hollerith in 1880 designed a punch card system which the U.S. government used to record census results. The machines took up entire rooms but were made in just three years and saved the government $5 million. Hollerith would later establish a company that would ultimately become IBM. 

The Z1 was developed in 1938 by Konrad Zuse, a German, and was the first binary computer and the precursor to the first electro-mechanical computer. Electro-mechanical computers generally worked with relays and/or vacuum tubes, which could be used as switches. The Z3, a Z1 descendent, was also a pioneer as it used floating-point numbers in computations and was the first program-controlled digital computer.

Around the same time as Zuse was working on his Z-series, David Packard and Bill Hewlett founded Hewlett-Packard in a rented garage in Palo Alto, California. The garage was the location of research, development, and manufacturing for the first products produced by the new company. 

Two University of Pennsylvania professors, John Mauchly and J. Presper Eckert, build the Electronic Numerical Integrator and Calculator (ENIAC) in 1943/44. It is considered the grandfather of digital computers and filled a 20-foot by 40-foot room and had 18,000 vacuum tubes. It is also significant as it gave rise to the UNIVAC (Universal Automatic Computer) which may be the first computer to become a household name with more than 45 units sold. Its first unit was delivered to the U.S. Census Bureau (again). 

In 1948, a team from the University of Manchester unveiled the “Manchester Baby”, a machine that tested memory technology. The researchers wrote and ran the first computer program on the Manchester Baby. By the 1950s, the first commercially available computers hit the market. Until this time, computers had been part of the scientific, mathematical, and defense communities.

A British catering firm, The J. Lyons Company, invested heavily in some of these early computers. In 1951, LEO (Lyons Electronic Office) became the first office computer that ran during operating hours. 

Losing the Census contract to UNIVAC gave IBM a scare and reengerized them and they released the IBM 701, the first mainframe computer produced by IBM. After that, a bunch of new computer models eroded UNIVAC’s lead and strengthened IBM’s position.

In the mid-1950s, computers began using transistors and replaced vacuum tubes, this lead to significantly smaller computers. Initially, they were less reliable but they also consumed significantly less power. In the 1960s, the microchip or integrated circuit was developed and this proved to be one of the most important advances in computing technology including minicomputers and microprocessors.