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Fujitsu research reveals retailers have reined in IT spending but no further budget cuts expected

August 10, 2009

Research commissioned by Fujitsu, a leading IT systems, services and products company has revealed that retailers are continuing to tighten their belts in light of the current economic climate, with 95% expecting the recession to last up to another two years.

The research, carried out via interviews with key UK retailers, highlights that reducing costs is the highest priority in the current climate, with 43% seeing IT budgets slashed. However, the majority don’t expect to see further budget cuts. It is interesting to note that one fifth of respondents have seen their IT budgets rise as management teams look to invest in their businesses during the downturn to emerge fitter, leaner and stronger.

Whilst 95% of retailers rated their organisations as efficient, only half have specific productivity targets in place. Asked to nominate the area they think would have the greatest impact on productivity, 37% said flexible IT systems, followed by seamless integration (26%). Only 58% of retailers are currently measuring the return on investment from their IT systems.

Sarah Kellett, retail industry consultant at Fujitsu UK and Ireland said: “It is concerning to hear that a large number of retailers are still not focused on measuring the real business value of their IT systems or staff. In a tough economic climate, where budgets are being reduced, it is vital that retailers understand the value of every aspect of IT in order to appraise and identify the business critical systems and ensure any investment is targeted at these areas.”

The research also revealed that few retailers have undertaken significant business process transformations in the last 12 months and where they have, it has not been in the area of IT.

Sarah continues: “Our research shows that the majority of retailers are looking for ways to reduce their IT spend, however as few as 37% are aware of, or indeed utilising the principles of lean management to simplify their systems, remove bottlenecks and eliminate waste. Retailers who identify and invest in their business critical systems during this tough economic time, will reap the benefits in the long-term and will be ideally placed to develop and grow their businesses once the recession is over.”

About Fujitsu

Fujitsu is a leading provider of information and communication technology (ICT)-based business solutions for the global marketplace. With approximately 170,000 employees supporting customers in over 100 countries, Fujitsu combines a worldwide corps of systems and services experts with highly reliable computing and communications products and advanced microelectronics to deliver added value to customers. Headquartered in Tokyo, Fujitsu Limited (TSE:6702) reported consolidated revenues of 4.5 trillion yen (US$55 billion) for the fiscal year ended March 31, 2011. For more information, please see: www.fujitsu.com.

Retail Customers

In the retail sector, Fujitsu Services’ customers in the UK include The Co-operative Group, Vodafone, Mid-Counties Co-operatives, Royal Mail, Whitbread and Carpetright. In Europe its retail customers include La Rinascente (Italy), Auchan (France), The EDEKA Group (Germany) and Kesko (Finland).

About the research

Independent research commissioned by Fujitsu Services between January and April 2007, examined how the use of self-service technologies is impacting the customer experience. The first phase of the research consisted of 12 focus groups (six conducted with groups of 18 to 25 year olds and six in which participants were aged 50 or over), convened in the UK, France, Germany, Sweden and Spain. Feedback from the focus groups was then used to compile a quantitative questionnaire, which was completed online by 2,400 respondents living in the five countries previously mentioned and in the Netherlands.

Graham Goulden

Phone: Phone: + 44 (0) 843 354 9568
E-mail: E-mail: graham.goulden@uk.fujitsu.com
Company:Fujitsu UK and Ireland

Nikki Haine / Sally Lloyd

Phone: Phone: + 44 (0) 1425 472330
E-mail: E-mail: nikki@mckennatownsendpr.com
Company:McKenna Townsend PR

Date: 10 August, 2009