Leroy Merlin: Gaining a more flexible ecosystem by migrating SAP to the cloud
About Leroy Merlin
For over 25 years, Leroy Merlin has been known as a leading retail chain in Brazil. It specializes in comprehensive home solutions and boasts a workforce of 10,000 employees. Using an omnichannel approach, it maintains 51 brick-and-mortar stores nationwide along with a variety of digital platforms, including ecommerce, telesales, WhatsApp, and its own app.
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Contact usBy moving its SAP systems to Google Cloud, Leroy Merlin managed to cut down on costs, boost agility, and create a solid foundation to improve the experience for both customers and employees.
Google Cloud results
- Zero infrastructure-related incidents more than one year after migration
- New servers released in just one day, compared to one month before implementation
- Reduced execution time for several SAP transactions
Around R$1.6 M cost savings per year
With over 51 brick-and-mortar stores throughout the country, Leroy Merlin is well-known for offering comprehensive solutions to Brazilian households since its first store opened in Brazil back in 1998.
The firm sells over one million items categorized into 15 categories: building materials, wood, electrical, tools, tiles, bathroom, plumbing, garden, hardware, organization, paint, decor, laminate and vinyl flooring, lighting, and kitchens.
Besides its physical stores, Leroy Merlin also has a strong digital presence, operating through platforms such as e-commerce, telesales, Whatsapp, and its own app.
To guarantee a consistently smooth, strong, and impactful customer experience, the firm's Brazilian team is constantly investing in streamlining its internal processes, and technology is a critical partner in this ongoing improvement process.
During its digital transformation journey, Leroy Merlin strategically opted to replace its enterprise resource planning (ERP) systems for SAP in 2016. This implementation took place within the on-premises infrastructure of its former service provider, with whom the company had a longstanding partnership.
Although this was the first step in a success story for the company, it was not long before the IT team realized major challenges lay ahead.
Building a solid and scalable cloud-based foundation
The first few months after adopting the new technology were challenging for Leroy Merlin. "IT challenges inevitably turned into business challenges because of repeated downtimes, lack of capacity, and how long it took to develop new services and functionalities," explains Orlando Tereza, Director of Infrastructure and Operations at Leroy Merlin.
In addition, given the demanding nature of retail, especially during peak seasons like Leroy Merlin's "Festa da Bricolagem" (DIY Party), when customer traffic surges for nearly 15 consecutive days across both physical and online stores, relying solely on contract-based models rather than on consumption models became increasingly untenable.
"We wanted scalability: paying for what we use, when we use it, and if we use it," says the Director of Infrastructure and Operations.
Driven by these challenges, Leroy Merlin's IT team embarked on the "Move to Cloud" project at the end of 2021, opting to migrate its SAP workload entirely to Google Cloud, which took place in 2022.
This nine-month initiative, involving 100+ collaborators for its implementation, revolved around Compute Engine, the application that now serves as a bedrock for the company's whole SAP infrastructure and guarantees minimal disruptions to data operations.
"Today, our entire data strategy resides within Google Cloud. Technically, pricing flexibility is crucial as it allows us to explore several machine learning, infrastructure, and data connectivity features on a single platform."
—Orlando Tereza, Director of Infrastructure and Operations, Leroy MerlinSAP's high availability on Google Cloud, with an impressive 0% infrastructure incidents in over a year, is a critical aspect for Leroy Merlin, especially in light of the system's pivotal role in managing inventory, logistics, and finances.
This journey has not only helped the company cut down on costs by R$1.6 million through expense optimization, but also attain a sizeable reduction in the execution times for several SAP transactions, such as inventory inquiries, legal and tax reporting, and technical demands, for example server provisioning times, which were reduced from nearly a month to one single day.
Data integration and connectivity as pillars of the data strategy
Now that the most complex technical aspects have been eliminated from the SAP infrastructure, Leroy Merlin's IT team can now focus their time and efforts on projects that create far more value for the business.
"Google Cloud tools are so user-friendly and intuitive that we can now focus on the value of what we are developing rather than on the architecture—often overly complex—to deliver the solution our customers need."
—Orlando Tereza, Director of Infrastructure and Operations, Leroy MerlinOne of the main Google Cloud tools the company is using is BigQuery, which allows employees to develop performance indicators and produce sales forecasts based on uploaded user event data.
Leroy Merlin is also using Google Kubernetes Engine as the platform to create, set up, and manage complex application instances to expand the features of its own APIs and several other in-house systems.
Utilizing the committed use discount (CUD) recommender in Cloud Storage also helps the company save even more resources.
A connected and omnichannel future with Google Cloud
As part of its vision for the future of business in Brazil, Leroy Merlin is committed to building an increasingly omnichannel retail environment by integrating all its points of contact with its customers.
Migrating the SAP workload to Google Cloud was a key step in this direction.
"We're sure we made the right call in migrating our SAP system to the cloud. Our initial idea was to boost the growth of our business, and this has been happening ever since: we've opened five new stores and completed several IT projects. And our Google Cloud environment is constantly growing."
—Orlando Tereza, Director of Infrastructure and Operations, Leroy MerlinThe company's next step is to migrate the infrastructure of its physical stores, moving processes such as user authentication, guest network, and printing to the cloud. The goal is to make the customer shopping experience the same across all channels, whether physical or digital.
With SAP in the cloud, Leroy Merlin now has the flexibility and scalability needed to offer a rewarding experience to its customers, leaving the management of the infrastructure to Google Cloud.
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About Leroy Merlin
For over 25 years, Leroy Merlin has been known as a leading retail chain in Brazil. It specializes in comprehensive home solutions and boasts a workforce of 10,000 employees. Using an omnichannel approach, it maintains 51 brick-and-mortar stores nationwide along with a variety of digital platforms, including ecommerce, telesales, WhatsApp, and its own app.