RETALIX LTD.

effectively manage customer management initiatives which are designed to foster customer loyalty and promotion strategies;
integrate enterprise and in-store systems to enable rapid implementation of customer management initiatives;
efficiently manage their supply chain to facilitate optimal inventory stocking at each location;
quickly and efficiently implement pricing, product and marketing decisions; and
support a wide variety of retail formats and services to increase customer convenience and satisfaction.
The food and fuel software opportunity
Many food and fuel retailers and distributors have historically relied upon a complex set of fragmented and poorly integrated legacy information
systems. Such systems are the byproduct of years of delaying implementation of a coherent enterprise-wide IT strategy, favoring patchwork upgrades over
comprehensive system revitalization. As a result, most food and fuel retailers and distributors operate information systems that are difficult to adapt to
today’s intensely competitive retail and distribution industries. Typically, these retailers’ and distributors’ existing information systems consist of standalone
POS systems with little or no integration with their back-office and with no enterprise-wide information system. These systems generally cannot be
easily modified to provide cross-enterprise visibility, collaboration and integration, nor can they support the information capture and analysis necessary for
reliable forecasting and coordinated purchasing decisions. In addition, in continuing to rely on these legacy systems, retailers and distributors face an
increasing frequency of breakdowns and system failures, exposing them to the ongoing cost of expensive maintenance.
In order to remain competitive and avoid the ongoing costs associated with maintaining their legacy systems, many retailers and distributors are
seeking to replace their legacy systems with modern, integrated food and fuel-specific retail information systems that can provide them with visibility
across the entire scope of their operations, support collaboration among retailers, distributors and their suppliers, allow enterprise-wide information flow
and enable implementation of sophisticated customer loyalty and promotion strategies. We believe that these replacement systems typically will be based
upon a modular, open-systems architecture, or non-proprietary software that can be easily integrated into a retailer’s existing IT infrastructure. Systems
meeting such criteria provide retailers and distributors with the flexibility to modify their information systems to respond to and manage their changing
business environment. Data compiled by a large industry provider indicates that North American retailers across all industries continue to rely upon legacy
POS systems that have an average age of eight years, with some retailers using systems that are as much as 10 to 20 years old. Consequently, many
retailers and distributors are considering replacing their outdated legacy systems in the near to medium term. Several industry surveys indicate that a
significant percentage of food retailers plan to make decisions regarding the deployment of new POS software systems during 2006 and that 2006 is
expected to be characterized by a significant increase in POS projects resulting in large volumes of rollouts throughout 2007 and beyond. These surveys
also predict a relatively high average annual growth rate of software spending within the global retail and wholesale industries during 2006 to 2009.
Our Solutions
Our software solutions provide a robust and comprehensive suite of applications for global food and fuel retailers and U.S. grocery and convenience
store distributors, addressing all three principal divisions of the retail and distribution channel – retail stores, headquarters (also called the enterprise level),
and warehouses and distribution centers, and enhancing the close relationship and collaboration between retailers and distributors. Our solutions are
designed to deliver “synchronized retail” where data and applications are communicating real time between the point-of-sale and supply chain to deliver
the greatest cost advantages and revenue generation capabilities to our customers. We believe that our solutions differentiate us from other providers of
software solutions to the retail and distribution food and fuel industries because they combine the following attributes:
Our integrated solutions span the retailers’ and distributors’ entire organization
We believe that our integrated suite of software solutions is unique among retail and distribution food software solutions, in that it combines all
essential elements of an enterprise-wide information system – stores, headquarters and warehouses – in a well-synchronized suite of solutions. Our Retalix
InSync Solution Portfolio tightly integrates our enterprise solution portfolio with our in-store back-office solutions and synchronizes the flow of
information between the two. Such an integrated solution permits retailers and distributors to generate substantial supply chain operating efficiencies and
cost savings through efficient management of inventory, purchasing and merchandising.
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