Spar Group Ltd., a South African retail business, reports a significant financial loss due to its SAP implementation project. The company estimates that the system's shortcomings, including poor pricing visibility and warehouse management inefficiencies, have cost them around $107 million in lost sales during the 2024 fiscal year. This surpasses the project's estimated implementation cost of $95 million, highlighting a potential 'anti-ROI' scenario.
Readers will be familiar with the concept of return on investment — when a tech project saves more than it costs — but less well-known is the idea that, like in particle physics, there exists an anti- ROI .
The data comes from South African wholesale warehousing and distribution business Spar Group Ltd, which licenses and services the franchised retail stores of the same name across the country as well as in other regions across Southern Africa, Ireland, Switzerland, and southwest England. The group said the SAP project it has been grappling with for the past few years has cost the org about $107 million in lost sales in the financial year to 30 September 2024.
"The implementation, which began in February 2023, faced critical challenges such as poor pricing visibility and inefficiencies with the new warehouse management system, which had resulted in an estimated R2 billion in lost sales in the 2023 financial year. Investors might welcome the reassurances, yet the sales decline logged for the retailer's 2024 fiscal already exceed the reported implementation costs, estimated at $95 million Mark Huxtable stood down for personal reasons and South African national information technology executive Brett McDougall stood in to help.Britain enters period of mourning as Greggs unable to process payments
ROI SAP Implementation Retail Lost Sales
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