An Introduction To SAP CAR: Karl Bend Retailsolutions AG (UK) LTD 1/1/2019
An Introduction To SAP CAR: Karl Bend Retailsolutions AG (UK) LTD 1/1/2019
An Introduction To SAP CAR: Karl Bend Retailsolutions AG (UK) LTD 1/1/2019
Karl Bend
retailsolutions AG (UK) Ltd
1/1/2019
SAP CAR - What exactly is it?
You might be wondering if SAP have gone mad and ventured into the motor industry in a bid to put
Tesla in their place? Fortunately for the retail industry, SAP is continuing to develop innovative retail
solutions to deal with the ever-changing behaviours of customers and the need for real-time insight
to support decision making throughout the entire supply chain.
One of SAP’s biggest innovations to date is the introduction of the Customer Activity Repository or
CAR for short. Taking advantage of SAP HANA’s in-memory computing it’s capable of providing real-
time inventory visibility, POS data transfer, sales analytics and demand forecasting in real time.
SAP CAR is the foundation that collects transactional data that was previously spread over multiple
independent applications. The repository facilitates a common foundation and a harmonized multi-
channel transaction data model for all consuming applications. As a result, this provides businesses
with one version of the truth and supports aligned decision making based on the same set of data.
At a glance it;
➢ Collects multichannel customer and POS data;
o Multichannel sales repository (MCSR) – The MCSR is the basis for multichannel
transaction and inventory visibility analysis. It helps to define order channels such as
retail stores, call centres, and online stores.
o POS Data Transfer and Audit (POSDTA) – An extended version of SAPs software
component for point-of-sale data management (POSDM).
➢ Accurately forecasts demand to optimise processes, decisions, and the shopper experience
➢ Creates more effective promotions and product assortments – and use customer insights to
personalise marketing
➢ Improves customer satisfaction with a real-time view of inventory, including on-shelf
availability and omnichannel article availability
➢ Minimises data replication and simplify your IT landscape with a single, unified data
repository
This powerful data platform prepares cross-channel data by collating, cleansing, and centralising
your customer and point-of-sale (POS) data in real time for analysis and prepares it for consumption
by other applications. Accelerate retail analytics and planning, improve demand forecasting,
maximise promotion and assortment effectiveness, and more.
To summarise, it’s a repository for storing and analysing data in real-time and prepares this for
sharing with other consuming applications and external systems.
SAP CAR – The basic components
First and foremost, as a pre-requisite, you must have an instance of SAP HANA installed, SAPs new
in-memory database solution. The reason for this is CAR utilises the HANA platform to provide the
real-time analytics and data processing etc. The below breaks down each component within CAR;
➢ Unified Demand Forecast (UDF) is a module in SAP Customer Activity Repository and
provides demand modelling and demand forecasting services for SAP for Retail applications
driven by demand prediction. UDF also provides insight into shopper behaviour, enabling
retailers to perform predictive analytics on customer demand.
➢ For input, UDF uses near-real-time information about multichannel customer transactions
collected in SAP Customer Activity Repository. UDF can also use historical demand data from
different time series (such as consumption data, point-of-sale data, or sales orders). Taking
advantage of SAP HANA capabilities, UDF provides a unified prediction of future daily
demands.
➢ For output, UDF generates a daily demand value plus an accompanying decomposition of
demand by demand influencing factors (such as baseline demand and promotional uplifts).
The demand forecasts can then serve as the basis for various cross-industry planning use
cases.
➢ Part of SAP CAR and provides a homogenised view of article availability across all channels or
‘silos’, app, web, bricks-and-mortar etc. As part of this, it provides facilities for Rough Stock
Indicators (RSI), Inventory Visibility and Availability.
➢ The new Omnichannel Article Availability and Sourcing (OAA) solution is based on a new
common cross-channel availability module in SAP CARAB Feature Pack, that consists of
different data sources for distribution centres (DC’s), stores and vendors:
➢ Pre-calculated DC stock availability information as ATP stock with time series, determined
via a periodical parallel ATP Run in ECC.
➢ Store inventory (out of CAR, continuously mapped with incoming POS documents).
➢ Vendor Stock (as of CAR 3.0).
➢ On various levels (e.g. product hierarchy, merchandise category, article), thresholds for a
traffic light availability status can be defined in SAP CAR (using the SAP HANA rules
framework) that can be used to populate a rough stock indicator.
For SAP CAR to perform all its wizardry it must regularly be supplied with both transactional and
master data. To achieve this, data is either sent or replicated from various systems at regular
intervals throughout the day. The below describes the various inputs;
SAP CRM
SAP also provides standard integration to SAP Customer Relationship Management or CRM, from
this customer insight data can also be shared with SAP CAR for further advanced analytics on
customer behaviours and shopping habits.
What outputs are available to utilise the processed data from CAR?
So, we have a high-level overview of what SAP CAR offers but where does it fit within a typical
system landscape and how can I use the information that’s being collated and analysed?
There are several standard outputs of the forecast data and these are typically called by the relevant
applications using standard Remote Function Calls (RFCs) from the target system. Examples of target
applications have been listed below;
Fiori Apps
As part of CAR, SAP provides a list of standard Fiori applications to help visualise and interpret the
forecast data calculated by the Unified Demand Forecast (UDF) function module. An example would
be the ‘Analyse Forecast’ application that enables the end user to have a detailed view of the
forecast and analyse all the contributing factors that were considered during its creation.
One of the use cases of the UDF forecast is to replace the forecasting solution within SAP F&R
through standard integration. The forecast from UDF is pulled into SAP F&R using ‘Remote Function
Call’ or RFC functionality and it’s possible to define if the UDF forecast should be called at Article and
Site level. This enables F&R to continue functioning without any disruptions to existing processes
and merely bases its replenishment calculations on a forecast generated from within UDF.
Essentially nothing changes apart from a far more sophisticated and granular forecast, providing
forecasts at a daily level as opposed to weekly within the standard F&R forecast.
SAP Hybris is the next generation cloud-based CRM (customer relationship management) suite from
SAP. It is a fully digital CRM suite which integrates with SAP ERP. It has omnichannel capabilities and
can communicate with customers via all touch points like phone, email, online web shop, in-store
etc for a 360-degree customer view. It primarily analyses sales, services and marketing data using
advanced analytics capabilities of which address the CRM shortcomings present in traditional CRM
systems. To support this, SAP Hybris Marketing can also call the unified demand forecast from CAR
providing a more detailed analysis of sale patterns in relation to customers.
All the below consuming applications have been developed to utilise UDF and perform ad-hoc
iterations of the ‘what-if’ forecast based on parameters defined within the requesting application.
For example, the ‘Promotion Management’ consuming application provides the ability to execute
what-if forecasts on intended promotional activity before promotions are created within the system.
For example, before confirming the price reduction for a promotion you can run the proposed
pricing mechanic through the what-if forecast to get a view of how this will potentially influence the
sales.
The consuming applications are as follows;
➢ Using the forecast data from UDF a planner can create a company-wide merchandise plan at
all levels of the merchandise hierarchy, for all selling channels, to build a purchasing budget
by month and week that is used for Open-To-Buy (OTB) purposes.
➢ You can develop sales, margin, inventory, and receipt flow for the upcoming fiscal year and
seasons at various levels of the merchandise, channel and time hierarchies.
➢ Model product groups across selling channels to propose assortments by using predictive
algorithms.
➢ Plan sales and purchase quantities by location clusters.
➢ Provide initial allocation instructions using approved purchase quantities.
➢ Review proposed product counts by location cluster when developing and assigning
products to the assortment plan.
➢ Define the parameters on the level of product groups and either stores or distribution
centres to provide business users with system-proposed allocation plans.
➢ Enhanced functionality allows for automated allocation processes at a level defined by the
business.
➢ Launch new fashion articles for the first time in your retail brick-and-mortar channel based
on defined target stocks.
➢ Facilitate automatic fill-in during seasonal periods.
➢ Set up the organizational structure of one or multiple market units that are relevant for
allocations.
What is the future of CAR?
With SAP having a vision of centralising many business functions and systems into one platform,
eliminating the need for complex system integrations and replicating data, the importance of CAR
for retail businesses will continue to grow. SAP has laid the foundations for years to come with
several planned innovations that are due to be included as part of CAR over the next couple of years
and CAR is heavily embedded within SAPs development roadmap going forward.