Published in The Australian, July 21 2003

CONVENIENCE store chain 7-Eleven is preparing a major rollout of a portal-based retail tracking system to its 298 stores - but it won't bring former communications partner Telstra along for the ride.

The privately owned chain plans to spend $12.5 million on creating a system that allows each of its stores to access its central SAP enterprise resource planning (ERP) system. As part of that project, it put its communications requirements out to tender earlier this year.

"To be honest, Telstra didn't seem that interested," said Michael Peck, 7-Eleven's general manager for information systems. A high-speed ADSL network is now being rolled out to the company's stores by Fujitsu and Nextep, which produced a "far better" tender offer, Mr Peck said.

7-Eleven's head office ERP system has been in place since 1998, when it was one of the first businesses in the world to implement SAP's retail package. The company now wants to make that retail data accessible to each of its stores to more effectively manage inventory.

"The technology in our stores is fairly old," Mr Peck said. "We need to move it forward. The infrastructure's in place, but we need to leverage it."

The system is scheduled to go live in December.

As part of the project, 7-Eleven is also planning to consolidate its current store system development platform of 19 IBM servers into a single IBM iServer, which is already being used to run its core SAP system. A recent IDC study suggested server consolidation could reduce costs by more than 50 per cent over a three-year period.

7-Eleven, which began its Australian operation in 1976, has announced plans to expand to 500 stores by 2005. It has introduced smaller stores to compete with the growing number of CBD-based convenience stores.

Its suburban sites, which typically sell fuel as well as convenience and grocery items, are also facing increased competition as Woolworths and Coles jostle in the petrol retailing space.