Feeds

MFI gets caught in SAP trap

Inventory woes lead to profit warning

  • alert
  • submit to reddit

Remote control for virtualized desktops

Furniture retailer MFI has ditched two board members after serious problems with its SAP inventory system forced it to make a profit warning .

The £50m system was supposed to turn things round for the troubled retailer but it is now facing an additional £30m bill to sort out problems with customer orders and fix the system. MFI became aware of the problem in July but said it was dealing with the symptoms rather than the causes. A review of August Bank Holiday sales revealed the true scale of the problem.

A spokeswoman for MFI told Computer Weekly that the firm is now going through each of its 8,000 product lines to check orders and distribution channels.

A spokeswoman for SAP would only tell The Register that MFI was a customer and that "this is not an SAP software related issue".

The man responsible for the supply chain, Gordon MacDonald, and chief finance officer Martin Clifford-King are "leaving the company by mutual agreement". Chief executive John Hancock will take on responsibility for the supply chain.

MFI told the Stock Exchange late last week that profits for the second half of the year would be materially below those for the first half because of significant problems with its inventory system.

But major shareholders are unhappy with how the announcement was made and blame senior management for not getting a grip on the problem earlier. MFI shares are trading today at 107.5p, down from a year high of 190p. They have fallen more than 20 per cent in a week.

Goldman Sachs has downgraded the retailer, to "under-perform" from "in-line", because it believes supply chain problems will take longer to fix than expected. ®

Related stories

HP users decry Itanium, SAP issues and bad English
HP's order system chaos to continue throughout August
SAP hits the numbers

Choosing a cloud hosting partner with confidence

More from The Register

next story
That dreaded syncing feeling: Will Microsoft EVER fix OneDrive?
Microsoft's long history of broken Windows sync
Mozilla, EFF, Cisco back free-as-in-FREE-BEER SSL cert authority
Let’s Encrypt to give HTTPS-everywhere a boost in 2015
SLURP! Flick your TONGUE around our LOLLIPOP – Google
Android 5 is coming – IF you're lucky enough to have the right gadget
Nokia's N1 fondleslab's HIDDEN BRILLIANCE: The 'Z Launcher'
Sugarcoating Android's Lollipop makes tab easier to swallow
Bug fixes! Get your APPLE BUG FIXES! iOS and OS X updates right here!
Yosemite fixes Wi-Fi hiccup, older iOS devices get performance boost
Microsoft: Your Linux Docker containers are now OURS to command
New tool lets admins wrangle Linux apps from Windows
Facebook, working on Facebook at Work, works on Facebook. At Work
You don't want your cat or drunk pics at the office
Soz, web devs: Google snatches its Wallet off the table
Killing off web service in 3 months... but app-happy bonkers are fine
Meet Windows 10's new UI for OneDrive – also known as File Explorer
New preview build continues Redmond's retreat to the desktop
prev story

Whitepapers

Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Choosing a cloud hosting partner with confidence
Download Choosing a Cloud Hosting Provider with Confidence to learn more about cloud computing - the new opportunities and new security challenges.
New hybrid storage solutions
Tackling data challenges through emerging hybrid storage solutions that enable optimum database performance whilst managing costs and increasingly large data stores.