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Retail chains are adopting web-based processes to manage store development. The bottom line: 60 days cut from the typical 12- to 18-month store development cycle.
Much like retailers use the web to collaborate with suppliers, some are turning to the web to manage store development. And just as product development time shortens when supplier and retailer collaborate on the web, so does store development time. In fact, Office Depot Inc. says it expects a web-based store development collaboration system from e-Builder Inc. to cut 60 days from the typical 12- to 18-month store development cycle.
And that means money, Office Depot says. “The faster you get development through the pipeline, the quicker the store will open and the sooner you’ll start getting sales,” says Tim Dearman, vice president of real estate for Delray Beach, Fla.-based Office Depot. “The company counts on a number of sales weeks per new store and this allows us to make sure that we are delivering the number of the stores at the time the company expects them.”
Office Depot adopted the e-Builder system over the summer, joining about a dozen other retailers in using the web-based development collaboration tool. E-Builder says nondisclosure agreements prevent it from revealing the other retailers’ names. “Retailers are so competitive and their margins are so thin that they don’t want anybody else to know when they get an advantage,” says Jon Antevy, CEO and co-founder of e-Builder. Office Depot has exclusive rights to e-Builder in the office supplies market.
The e-Builder system manages the workflow for development teams and allows all members of the team to work from the same version of the documents and plans. For instance, the program reminds the appropriate person when it’s time to apply for permits and then sends out increasingly urgent follow-up reminders until the permits are recorded. It also tracks and records all changes to documents, time stamps with individuals’ i.d.s when changes are made, and makes the most recent version the one that employees work off of. “In real estate development, there are a lot of negotiations, especially in leases,” Dearman says. “This system will automatically save each version so we have a record of where we started and how we got to where we are, but will also keep the latest version in the forefront.”
Like any new technology, e-Builder requires staff training. Office Depot created a mock construction project and let employees learn how to use the system by conducting transactions that go into a construction project. As for contractors, Office Depot will require them to conduct business with Office Depot over the e-Builder system. And how they learn to do that is up to them.
E-Builder hosts the application at its tech center in Gainesville, Fla., with back-up at a McGraw-Hill facility in Hightstown, N.J. Implementation costs several hundred thousand dollars with monthly fees that run into the thousands, Antevy says. He argues that faster store openings with consequent faster revenue allows retailers to recoup their costs almost immediately.