How an Australian retailer is positioning itself for international expansion

Chemist Warehouse Australia

While many retailers were forced to shut up shop as COVID-19 lockdowns gripped the nation, Australian pharmacies remained open. Classed as an essential service, chemists continued to dispense vital medicines, regular flu vaccines and basic protective gear to a grateful nation.

For Chemist Warehouse the extra pressure of a global pandemic couldn’t have come at a worse time. The Australian pharmacy chain had recently planned to expand into Ireland, using its European tilt as a springboard to shift from discrete, on-premise business systems to a globally supported cloud-based platform.

The retail giant chose to work with local provider Sonata Scalable, backed by the resources and expanded capability of parent company Sonata Software, to implement Microsoft’s Dynamics 365 software-as-a-service ERP platform (Dynamics 365 Finance, Supply Chain, Commerce (Retail Point of Sale)).

How going off-shore led to going off-premises

Despite the disruptions of the past year, Chemist Warehouse CIO Jules Cardinale says the group’s expansion into the European market remained the right time to overhaul business and operating systems.

“This transformation will ensure all of our international franchises will operate on one platform, solving a lot of operational barriers,” Cardinale says.

“It will allow us to consistently manage and maintain various systems across the world using best practice infrastructure with greater availability, scalability, and cost effectiveness than our on-prem solution could afford us.”

Chemist Warehouse is Australia’s largest pharmacy retailer generating more than $5 billion a year in sales across its 500-store franchise network. It’s a big business with high volume turnover and substantial IT demands.

Scalable founder and Director Brett Crew credits an astute executive for the decision to transition to a cloud-based platform. “By choosing to adopt a modern, cloud-based approach, the company must either re-write their applications or adopt a new standard and deploy that,” Crew says. “Running with Dynamics 365 is a long-term strategic initiative which demonstrates enormous trust in Microsoft and Sonata Scalable.”

Borders no barrier to an integrated system

Dynamics 365 will operate the same way in Ireland as it does in Australia – with local currency and tax coding requirements met by Microsoft’s international capabilities.

Dispensing systems specific to each jurisdiction are able to be readily integrated into the one, unified system.

Dynamics 365 will also manage B2B interactions, streamlining supply chain logistics, Chemist Warehouse corporate billing and the individual billing of franchisees.

Cloud and PowerApps combine to unleash creativity

For the Chemist Warehouse technical team, shifting to the cloud frees them up to focus on the company’s expansion plans. “If I go into a new country, the last thing I need to do is purchase hardware, set-up servers and provide services that way. I can just consume them,” Cardinale says.

Instead of troubleshooting on-premises challenges, the Chemist Warehouse team will focus on developing bespoke solutions for customers, including applications built with Microsoft’s Power Apps platform.

Why Sonata Scalable?

Microsoft recommended Sonata Scalable as a potential provider to Chemist Warehouse, but winning the deal meant winning against strong competition locally.

With a confidence born from experience in the sector, Sonata Scalable responded  quickly with a simple but compelling pitch; local experience backed by the capability and resources of an international parent.

Sonata Scalable has runs on the board with retail in Australia, having worked with other large players such as Spotlight and Lorna Jane. Sonata Scalable’s Brick and Click retail solution and Modern Distribution platform for e-commerce also gave them an advantage over competitors, as did their position as a top tier Microsoft partner. When Chemist Warehouse wanted to discuss additional needs around the Microsoft retail solution, Sonata could draw on its strong relationship with Microsoft, working with the R&D team in Redmond to discuss their requirements.

“It’s not typical for an Australian partner to have the connections that reach into the back end of the Microsoft’s product team to have that conversation,” Crew says. “It’s been a very collaborative process.”

Customer first

While there was a compelling business case for embracing digital transformation, Cardinale says the group’s main reason for leveraging the Dynamics 365 platform is to provide a better experience for their customers. That means offering a true omnichannel retail experience.

The new integrated platform will give Chemist Warehouse transparency on which products are on order, who is delivering it and when.

That will help streamline delivery and pave the way for Chemist Warehouse to expand its online customer offering so the customer’s purchasing experience (whether in store or online) is made as simple as possible.

“Omnichannel is about receiving or buying goods from us in any way you want,” Cardinale says. “That could mean click and collect or click and deliver, and a number of other initiatives that we’re looking at.”

Perfect timing

Being able to offer robust e-commerce solutions is more important than ever, and harnessing cloud services will enable Chemist Warehouse to provide safe and secure retail for customers and staff around the world.

“Sonata Scalable is starting them on their journey to an integrated cloud platform for retail, finance and supply chain,” Crew says. “It is a collaborative partnership and just the start of an exciting enablement journey.”

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