According to Jim Dion of Dionco Inc., that depends on whether you want to to be the Hottest retailer, the Easiest, the Cheapest, the Biggest or maybe the Quickest. (McMillan|Doolittle "est" theory)

"Choose one of these strategies and win at that one, be outstanding at it. But don’t ignore the others."

Dion says that the ‘est’ model is important in determining the technology you choose. "If I’m looking for toilet paper at 2 a.m., then I want the easiest store. If I’m short on time and want to make one stop, then I want the biggest store that has the largest selection."

Once you’ve chosen your strategy, what technology do you need to be the best ‘est’ you can be? Do you need wireless point-of-sale stations, headsets, Internet stores, multi-media?

"Technology gives you strategic advantage. You need to know what your strategy is and get the technology that delivers that strategy, otherwise you’re wasting your IT investment."

Here’s Jim’s Top 10 Technologies list. He ranks numbers 1 and 2 as the most important – those that manage inventory and help you to know who your customers are.

1. Universal Product Code (UPC), Quick Response, Just-in-Time and Electronic Data Interchange (EDI) – These technologies are vital. Inventory is the lifeblood of retail and if you don’t have it fast, in the quality and quantity you need – customers will shop elsewhere.
    
2. Customer Relationship Management (CRM) software is absolutely critical today. You need to know who your customers are and proactively market to them. CRM allows you to track customers, know what they bought and use the information to market to specific segments.
    
3. Automatic replenishment – A big time saver for retailers who stock a lot of staple products. This software automatically replenishes what has been sold.
    
4. Video integration – Having CD-ROM at the POS means that while sales associates aren’t serving customers, they can be getting sales training or product knowledge from vendors’ catalogs, more and more of which are now available on CD.

If a customer is looking for a product from a certain vendor that you don’t have in stock or carry, the item can be displayed on-screen from the CD and special ordered.

Interactive Kiosks are another example of video-integration in the store, and provide customers with additional product knowledge. Music and picture Price Look Ups are other benefits of using multi-media.

5. Smart Registers – This component may look like a cash register, but it’s actually a PC with industry standard architecture, giving tremendous communications ability between the stores and head office via email. It allows you to print reports, capture customer profile information, perform labour scheduling, etc.
    
6. Executive Information Systems (EIS) – This windows-based software gives retail executives a graphical view of the data they need to make sound business decisions. Easily manipulated into a number of graphical formats, the information can be quickly sliced and diced to identify problems and opportunities in your business. Also known as data warehousing or data mining software.
    
7. Wireless communication – Imagine a packed store on a Saturday afternoon. Your sales associates are in the stockroom trying to find merchandise for the customers they’re serving, leaving waiting customers wondering where the help is. If associates have headsets, one can easily serve those customers waiting in line while communicating orders to the other associates in the stock room. Associates can also work together from anywhere in the store to monitor for shoplifting.

Having a sidewalk sale? A wireless cash register, not hardwired to a network, is the solution. It can be easily picked up and moved anywhere it’s needed.

Taking inventory with a hand-held unit that can be downloaded to your head office system is much faster and easier than gathering it with a clipboard and pen, and keying all the data into the system at a later date.

8. Pen and voice computing – Signature capture at the POS is the best way to get your customers’ signature for credit card receipts. And, if a customer returns to dispute their purchase, your sales associate can bring up the store copy electronically - much easier than fishing through shoeboxes filled with receipts!

Voice computing allows you to operate your computer with voice prompts. You can generate reports or provide information to your customers.

9. Smart Cards – More commonly used in Europe than North America, these are credit cards with microprocessors that store the customer’s money. No need to call in phone authorizations, the purchase is taken right from the card.
    
10. Virtual shelves – (Intranets and the Internet) Intranets are internal communications set up between a retailer and a vendor allowing for faster communication and on-time replenishment.

The Internet, E-commerce, E-tailing – if you haven’t determined an e-commerce strategy, "start doing something!". At least get a web site up that provides information on product lines, policy statements and stores locators. Open the lines of communications for your customers and your vendors.

Dion says, "It’s a frightening venture, to enable a product that is going to keep customers out of your store. If you want to test the waters, offer a limited number of products online and see what happens. But remember, online shoppers want it hot, they want it fresh, they want it now and they want it cheap! Ask yourself if you can really provide that and if you can’t, then you are setting yourself up to get some angry customers."

As for the bottom line, Dion recommends investing three to five per cent of sales on technology tools. The percentage depends on sales volumes and business strategies but "if you haven’t been investing in technology up to this point, you will really have to race to catch up. The longer you wait, the further behind you’ll fall."