Now SAP in China

SAP kicks off the week this week comfortable in the knowledge that they’ve sold China’s Wumart Group on their product.

Friday had SAP inking a deal with Wumart Group, one of the largest and fastest-growing private supermarket chains in China, to employ mySAP ERP and SAP for Retail to upgrade company information systems. SAP claims Wumart now holds the distinction of first Chinese supermarket chain to implement an international enterprise resource planning and retail package “from a top global enterprise software provider.” Usage of selective modifiers aside, Wumart’s implementation is symbolic of the changing face of Chinese IT infrastructure.

Like Western firms that The Chump hears about every day that finally make the jump to CRM, Wumart saw geographic growth, which in turn made the legacy IT system insufficient, which in turn messed with the company’s development, etc.

Unlike most Western firms, Wumart began a process typical of huge Chinese firms. After forming a selection team in November 2005, chairman of the board Dr. Zhang Wenzhong brought them to 20 international companies that had successfully implemented ERP systems in China, France, Switzerland, Canada, the United Kingdom and the United States. Most companies like to pump themselves up in PR by announcing they won such and such a bid over their fierce competitors. SAP’s got some serious bragging rights here.

Post-installation, Wumart expects to roll out an ERP and retail system connecting headquarters with its over 500 outlets in areas such as category management, internal supply chain management, commodity planning and chain store management.

The first phase of the project includes SAP for Retail at the Wumart headquarters and Tianjin branch; a logistics system for the distribution centers in Beijing; an interface to Wumart’s point-of-sale system; and the SAP retail outlet system. SAP China Consulting will provide the implementation on this project, and the overall implementation has been given a timeframe of approximately one year.

Founded 12 years ago, Wumart has become a dominant retailer in China with more than 700 hypermarket, supermarket and convenience store outlets; last year, annual sales were posted at approximately US $2.52 billion. This year, Wumart has gone Oracle in China, acquiring several fourth-largest and fifth-largest Beijing supermarket chains Chaoshifa and MerryMart; northwestern China retailer Xinhua Stores; and eastern China retailer Times Supermarkets.