The Way Business Is Moving published by
Issue Date: June 2007

Massmart gets a rebate edge from open source

14 June 2007

Massmart, a retail giant and the third largest distributor of consumer goods in Africa and the leading wholesaler of basic foods keeps its portfolio of wholesale and retail chains on the cutting edge of competitiveness by running its rebate solution system on open source technologies.
Nikki Swain, business system and process manager at Massmart says the company’s original rebate solution application was specifically developed for Massmart some time ago. The system has regularly been updated over the years as different areas of the rebates department required new functionality. Consequently, the system growth was pushed by demand and ended up as a large and unwieldy piece of code.
“In 2005 we therefore decided to replace the rebate solution,” says Swain. “Although there are commercial applications available, Massmart found none of these matched our specific requirements for the local market.”
Massmart operates in a very competitive industry. The organisation is a managed portfolio of 10 wholesale and retail chains, each focused on high volume, low margin, low cost distribution of mainly branded consumer goods for cash, through 228 outlets, and one buying association serving 478 independent retailers and wholesalers in 11 countries in sub-Saharan Africa. Ensuring its rebate system is operating optimally is therefore a business-critical function handled by a team of over 40 people who are responsible for all rebate negotiations and administration tasks.
“We have over 30 Gigabytes of rebate information that has to be analysed and reported on each month,” adds Swain. “We therefore needed a stable system able to handle the data load quickly and reliably.
The team currently at Edge Consulting was chosen to create the system according to Massmart’s specifications and to provide support for Actuate. Edge provides business solutions through a focus on sound ethics, customer obsession and embracing a collaboration perspective.
Through a careful process of business consulting and analysis, the team designed the application and recommended Massmart deploy it on open source technologies.  After investigating the open source solutions proposed – namely the J2EE architecture together with the Java development language, the Linux operating system and the PostgreSQL database – the team was given the go-ahead.
There is some concern in the market as to whether open source systems can handle business critical computing and whether there are enough skills available to support these systems. Edge is able to prove to Massmart that it has the skills and capabilities to develop and support open source solutions customers can rely on”, explains Yusuf Salejee, director of Edge.
The project was completed and implemented early in 2005. The company now runs its rebate solution on a new Web-based system that provides employees with easy access to reports. Specific people within the rebates department are also able to request ad hoc reports when needed.
Edge Consulting is still involved at Massmart to support the product and assist with ad hoc reporting requirements. It will also take responsibility for developing and implementing a number of enhancements to the solutions Massmart has identified. To ensure it provides service consistent with its ethic of customer obsession, Edge has IT staff operating at Massmart’s premises on a fulltime basis.
“We now have 10 chains on the system, which has proven itself to be very stable,” concludes Swain. “Edge Consulting continues to be involved in terms of business analysis and development on the enhancements Massmart has identified, and as a strategic solutions partner for our day-to-day needs.”

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