Broadband for Retailers

Document Downloads Executive summary for Retailers (one page business justification) Private Networking for Retailers (two-page brochure) Private Networking for Retailers (full document as below)

 
The challenge

In today’s cost driven and fast-paced environment, in order to remain competitive, retailers are being drawn into the realm of real-time on-line information systems whether they like it or not.

At the same time, the range of products and services on offer from vendors is exploding. How then does a retail organization, regardless of size, sort through this chaos? Whilst we all know we must “do something”, what does this actually mean? And even if we are able to unravel the techno-jargon, how can this “something” result in the retail organization becoming more agile, more competitive and more profitable?

After all, are these not the reasons why organizations embark upon IT infrastructure expenditure in the first instance?

The future  

Successful retailers are embracing high speed real-time polling between stores and head office. Gone are the days of end-of-day polling only – this is simply not agile enough in order to remain competitive . Retailers are replacing costly intra-site faxing with secure and managed email facilities. Their stores are able to view real-time warehouse inventory levels and stock held at other stores.  

Intranet forms are beginning to replace faxed forms. In-house supported Web servers are emerging providing the flexibility for the retailer to create their own electronic ‘stationary’.  

And they are starting to explore the benefits of using these high speed networks to replace their telephone systems to enable free voice calls between remote locations. Furthermore, centralised EFTPOS becomes a reality thereby further reducing costs.  

Remote video surveillance for enhanced security is becoming increasingly more important for retailers as they attempt to control shrinkage.  

However, beware of the VPN!

Traditionally, VPNs (Virtual Private Networks) have been established at head office to enable data communications to their remote stores. 

A VPN is a way of ‘fooling’ the open Internet into believing it is a secure network between stores.  

Many vendors and large ISPs offer VPNs today. These providers may disguise the VPN by claiming they are offering the customer a ‘secure end-to-end solution’. This is nothing more than a ‘managed’ VPN. 




VPNs are complex to support

A VPN requires complex set-up of the organization’s networking environment. Because it is operating across the open Internet, it is essential that strict firewall rules and security devices are implemented at each site.  

These are costly to install and even more costly to maintain (a hidden cost not to be taken lightly). A mistake in any single VPN device may open up the retailer’s entire network and thus sensitive data up to the whole world!  

In a world where ‘hacking’ into corporate networks is seen by many as a challenge, this is far from an ideal solution.  

Furthermore, whilst the retailer may believe they have a dedicated service from their ISP or networking vendor, in fact they are simply competing for bandwidth and usage across the public Internet. And in most cases they will be charged for data travelling between the various locations. 

The dangers of low-cost ADSL solutions

The market today is flooded with vendors selling low-cost ADSL services. These vendors will promote these services as being suitable for commercial use. 

Low-cost ADSL services are domestic grade – they are not suitable for businesses. The low-cost ADSL services are NOT as reliable as today’s dial-up services!  

Retailers who have adopted these low-cost services have realised that they are not suitable for company critical data. They simply do not have the reliability and robustness required for a business to operate effectively.

With up to 24-month lock-in contracts, retailers are finding themselves in very difficult situations when they discover cheap is not always good for their organization.   

Whilst a VPN can essentially run across any type of Internet connection, this in itself is where the risk lies. And most of the low-cost VPN’s are being sold on the back of domestic-grade ADSL services.  

In the ‘good-old’ days

In the days prior to the Internet, telco’s would provide dedicated point-to-point interconnect services to clients.

These were leased line services and were very expensive. They were thus affordable by only large retailers and were typically Frame Relay or ISDN based.  

However, these private networks offered highly secure, robust and reliable connectivity. Set-up and maintenance was simple and the networks were essentially an extension to the client’s internal network. 

This was the basis of a WAN (Wide Area Network).  

The rapid advancement of technology now offers many alternatives. This is good, but can also lead to false expectations as a result of unscrupulous marketing. 

In the past it was easy – either costly WANs, or low-cost dial-up. Today it is far more complex (and risky). 

Today’s Private Network

A Private Network (PN) is effectively the same as the dedicated WAN, except it takes advantage of the lower cost business-grade ADSL technologies which are connected to a dedicated private network established solely for the client.  

A Private Network, or as it is sometimes called, a VLAN (Virtual Local Area Network), does not use the public Internet for transmitting its data from point to point.

The Private Network is 100% secure from the outside world, is exceptionally simple to set up and maintain and thus enjoys a very low ongoing cost of ownership.  

Because the Private Network is not competing for bandwidth with other users on the open Internet, it is therefore fast with predictable performance, something crucial when polling remote stores. 

Furthermore, as a Private Network is strictly internal to the organization’s infrastructure, there are no data costs between stores on the network and no additional firewalls or routers are required to set the network up. 

It is as simple as plugging an ADSL modem into the telephone line and connecting the stores registers into this device.  

Due to the extremely low maintenance requirements, the cost-of-ownership of a private network is far lower than a VPN.  

 

Other benefits of a Private Network

As the Private Network offers full security it enables head office control over sending and receiving emails between stores and head office and the outside world, thereby controlling abuse. 

Likewise, it is extremely simple to block external Web browsing for the stores, whilst allowing the head office staff full Internet access.  The head office becomes the ‘gatekeeper’ for all traffic going to and from the Internet.  

But at the same time, as the Private Network is an extension of the stores secure internal network, it becomes a real opportunity to eliminate intra-store faxing and to establish an Intranet. This Intranet could be expanded to include end-of-day forms for each store to complete and submit to head office for processing.  

Once a Private Network has been established, other opportunities rapidly open up. Voice over IP becomes a real option, video surveillance is possible, centralized EFTPOS can be explored, and so on.  

How can AlchemyIT assist?

As AlchemyIT is a channel partner of the likes of NEC/Nextep, Telstra, SPT and Uecomm, we are very well placed to offer solutions specifically tailored to the retailers needs. 

However, before we recommend an IT-based solution, we prefer to understand the retailer’s business and operations strategies. These will be critical to ensuring the correct technical solution is proposed. 

The diagram below illustrates our consultative process:

 

Testimonials

AlchemyIT has been working in the retail sector since early 2001. Together with our business partners, we have provided creative and cost effective solutions enabling retailers to better manage their businesses. 

"At last a company that delivers what they promise. 

Over the years alchemyIT have worked with us to provide fast and reliable Internet and Private Networking solutions for both our own facilities and the many companies we represent.  At all times, the service has been excellent and the staff responsive to our demanding requirements."  

Clive Klugman
Managing Director
Technology Solutions for the Retail Industry
www.sviretail.com.au

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