Retail businesses can operate in hundreds, even thousands, of dispersed geographic locations and be staffed by employees with little, if any, IT training. But slim profit margins force IT directors to keep costs as low as possible.
Some retail operations are turning to Linux, the open-source operating system that, unlike commercial operating systems, comes with no license fee.
In addition to the lower upfront cost, retailers such as Papa Johns International Inc. have found that Linux can give them control of development costs.
Papa Johns is rolling out Red Hat Inc.s Red Hat Linux distribution on POS (point-of-sale) systems in its 2,900 restaurants, according to a report released last month by International Data Corp., of Framingham, Mass. Terry Foster, director of field systems development at Papa Johns, told IDC that he expects the Linux-based systems to recover faster from crashes. Foster said he plans to install the Red Hat operating system and new applications on existing equipment and thereby get more mileage from hardware.
By upgrading from its Unix-based systems, the company, based in Louisville, Ky., said it expects to see significant savings in capital expenditures and provide a platform that can be remotely upgraded to meet changes in operations and marketing.
Papa Johns has set up its POS devices so that they are extensible to personal digital assistants, touch-screens and other new technologies.
Papa Johns is not alone. IBM late last month announced it had signed up two new retail customers to Red Hat Linux: movie theater chain Regal Entertainment Group Inc. and Brazilian retailer Casas Bahia.
“The state of the economy means that retail firms are increasingly looking at cost as a vital component of their IT decisions. The costs are generally lower for Linux implementations than with any other environment, and the reliability and uptime is better,” said John Sarsgard, IBMs vice president of Linux Solutions, in Somers, N.Y. “The total cost of a Linux implementation is, in my opinion, also significantly lower than for other competitive solutions.”
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This is borne out by Regal executives, who said they chose Linux because it is an open, affordable operating system that gives them a lower cost and relative ease of programming with the Java projects they already have in place.
Regal unit Regal Cinemas, which was previously running old electronic cash registers that were not tied to the system or to the back end, is now using 2,400 IBM SurePOS 500 systems running Red Hat Linux at concession stands, which are linked to an IBM eServer iSeries server at its headquarters, in Knoxville, Tenn.
Regal is also testing a new, in-theater, Linux-based kiosk that enables movie patrons to buy tickets or retrieve tickets purchased from an online service.
For its part, Casas Bahia, the largest nonfood retailer in Brazil, is moving to more than 1,500 IBM 4694-207 and 205 POS systems running Red Hat Linux in its 320 stores. The company was previously running a DOS system but said it believed this lacked an upgrade path, was difficult to grow and had outdated user interfaces.
The POS screen is also used to display advertisements, but the DOS system did not have the necessary resources to update the screen images. The company also wanted a system that would allow them to implement all POS functions, officials said.
Linux also gives Casas Bahias developers the possibility of using an agent made by IBMs Tivoli division in the POS systems to optimize the management and software distribution, company officials said.
Despite the promise of this cost savings, Linux-based POS systems have yet to gain widespread use. Although the number of such devices running Linux grew 80 percent last year, according to IHL Consulting Group, the retail industry market research company earlier had forecast 300 to 400 percent growth. Officials at the Franklin, Tenn., company blamed the results on changes of heart at Musicland Group Inc. and Home Depot Inc., both of which had planned Linux POS deployments but changed course.
IHL reported that various Windows versions were installed on some 69 percent of total POS terminals sold last year, while Linux accounted for 2 percent.
But IHL does see a future for Linux.
“We expect to see more use of Linux in [the drugstore] segment and in the pharmacies of larger supermarket chains because of the easy interaction with many of the more popular pharmacy applications that run on Sun [Microsystems Inc.]s Solaris and SCO-Unix,” said a recent report from the company.
In addition, the age of many POS systems means that many are coming to the end of their usable lives.
“Our existing point-of-sale database did a good job for many years, but our needs have grown,” Papa Johns Foster said in the report.