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Retailer picks Linux for point-of-sale system

Burlington Coat Factory is a pioneer among large retailers that have turned to Linux-powered point-of-sale systems for their security, stability, and cost savings.
Written by Karen D. Schwartz, Contributor
Thirty years ago, Burlington Coat Factory was just another small, off-price clothing retailer ringing up purchases with old-fashioned cash registers.

By last year, sales had reached $2.4 billion at the Burlington, N.J.-based company's nearly 300 stores in 42 states. The company's rapid growth, coupled with a plan to add as many as a dozen new stores each year, led to a serious strain on Burlington's internal systems.

The strain was perhaps greatest on the company's aging, overloaded DOS-based point-of-sale (POS) environment. The software, which had been written in C by the company's in-house staff in the late 1980s, originally ran on 286-based PCs.

"We've added about a dozen services to our POS system since we originally developed it, with things like check readers, signature capture pads, and check authorization," says CIO Mike Prince. "The program had gotten so large and complex that it just didn't fit the older DOS-based platform anymore. We reached the point where squeezing more complexity or functionality out of the current register system wasn't feasible." The in-store processing environment also lacked the ability to handle Web-centric computing.

Prince decided to upgrade to Wincor Nixdorf's Linux-based BEETLE/S POS system, running under Red Hat Linux 7.1 on a box with a 566MHz processor, 128MB of RAM, and a 4.3GB hard drive. The Linux boxes will connect via an 802.11b wireless LAN to an in-store server on which employees will be able to look up prices, transmit transaction data, and store data. Eventually, all POS systems in the stores will run Web browsers, allowing employees to access the company's gift registry, look up stock information, and access a self-service system to check benefits, vacation time, and perform other personnel-related functions. For procurement and expense needs, Prince's team plans to install Oracle Internet Procurement and Internet Expenses on an IBM NUMA-Q server at headquarters, and make it accessible via a browser from Linux-based terminals at the store level. Through this application, "we can empower employees to requisition [supplies] through a browser," Prince says.

Beginning in 2001, Burlington Coat Factory began installing the Linux POS platform in its new and remodeled stores (less than 15 percent of its total number of stores). Eventually, all the DOS POS systems, typically with eight to 16 terminals per store--will be replaced with the new Linux systems, though budgetary issues may cause the full rollout to take another year.

The new platform lets the company extend the functionality of its POS system without concerns about hardware limitations, Prince says. Prince also says the Linux-based system is more stable, easier to maintain and administer, and more secure than Windows-based options. "It's an [economical], stable, efficient, secure operating system, and all of those things are good to run your POS on top of," he says.

The PC-based system is also faster and less expensive than the alternative of dedicated POS systems. "We didn't want to spend $4,000 on a box that would be worth $1,000 the day it arrived at the store," says Percy Young, Burlington Coat Factory's director of store systems. "This way, we spent considerably less on state-of-the-art Pentium architecture."

Prince estimates that the Linux-based POS system will save at least 25 percent over the older system, due to improved ease of administration, better security, the lack of operating system licensing and upgrade fees, simpler software maintenance, and better platform stability. "A typical Linux box will sit on the network and run for months without rebooting, and it's very difficult for someone to mess it up," he says.

Once the Linux POS system is installed in all Burlington Coat Factory stores, the company's technology team will begin integrating them with the packaged ExtendYourStore software from 360Commerce, a move Young says will further modernize and Web-enable the POS environment.

Burlington Coat Factory is one of only a handful of large retailers turning to Linux at the point of sale today. However, according to IHL Consulting Group, a Franklin, Tenn., retail consultancy, Linux use at the point of sale is growing, from 2 percent in 2000 to 6 percent in 2001, and could rise as high as 12 percent by 2004. For comparison, 34 percent of POS systems in the United States still ran DOS at the end of 2000, while 17 percent ran Windows NT, 23 percent ran Windows 9x, and 21 percent ran the IBM 4690 platform.

Still, IHL President Greg Buzek says Linux may not be the best choice for a companywide POS environment. "The question is whether you want to be in the retail business or the IT business. You have to recruit more staff and more support people for a Linux installation. You can outsource more of it with Windows," he says.

"Linux POS systems are a good choice if the retailer is willing to own its own application and process," he says. "They either feel they can lower their total cost of ownership--something Microsoft disputes--or have more flexibility to design the system to maximize their business. In essence, they view their front end as a key to their competitive advantage and feel they can do a better job of development than vendors."

For Burlington Coat Factory, though, the switch to Linux fit right in with the infrastructure already in place in its stores and data center.

"For us--and other large retailers like us--this is a natural progression," says Young. "For other, usually smaller, organizations, other options may make more sense, but for us it was a 'no-brainer.'"

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Karen D. Schwartz is a freelance writer specializing in technology and business issues. Her work has appeared in numerous publications, including CIO, InformationWeek, Business 2.0, and Mobile Computing & Communications.

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