A botched ERP software implementation at Spar Group is still dragging down the Durban-headquartered retailer’s financial results.

Spar said in a trading update on Thursday that the SAP enterprise software system it installed to manage its KwaZulu-Natal distribution centre will impact severely on its full-year performance.

It attributed an expected full-year loss of turnover of R1.6-billion to the project’s failure.

“The operational impact amounted to an estimated R720-million in loss of profits for this region,” the group added.

“As a result of the change in approach towards the SAP implementation roll-out for the foreign regions, a write-off of R94-million in respect of the SAP ‘asset under construction’ has been recognised,” it added, without providing details.

Spar said in September that SAP – the German-headquartered enterprise software giant – had “remained a supportive partner throughout the project”.

“After months of collaboration to resolve the issues and drive success, management is satisfied to report that the KZN distribution centre is once again servicing all stores in the region. The SAP solution is stable and performing consistently,” it said on 28 September.

Read: Spar CIO resigns amid botched SAP project

The retailer’s share price fell 4.1% on Thursday following the release of its latest trading statement.  – © 2023 NewsCentral Media

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