The Latest Tech That Will Help Improve Retail Efficiency
19th April 21
Despite the innovative technology enabling retailers to fine tune marketing, loyalty schemes, ranging decisions and supply, there has been relatively little innovation in physical stores since handsets for stock management and self-checkout tills were introduced years ago.
That looks set to change as more retailers are introducing tech to improve productivity and free up resource from routine tasks to extend the customer offer. It could just be that retail investment is cyclical at the best of time, the big jump in online shopping volumes. Or the competitive pressure of the innovation that Amazon is bringing to UK high streets. Most likely it’s a mix of all three. Whatever it is, big changes are coming to high streets near you and we at ReThink are spending more of our time helping retailers track the time savings.
The two technologies we see creating the biggest change for retail operations are Radio Frequency Identification (RFID) and Electronic Shelf Labels (ESL)
RFID Innovation Will Decrease Time Spent With Stock
RFID requires a small tag to be attached to every item. Once attached the system knows how many of each item are in the supply chain and exactly where they are. The technology was first conceived in the 1950s and the first commercial patent was granted in 1983. It’s a tried and tested technology that is starting to get more traction after years of waiting to be the next big thing.
From a store operations perspective, RFID means deliveries are zapped once and every item is added to the stock file. There are no counts to do, fill up lists can be generated automatically based on known stock on the floor and in the back and typically excess stock holding is eliminated from stores too. Given that stock management is often one of the major chunks of work in a store, RFID can transform how time is spent and eliminate stock counting. While this is a huge change for stores it also enables online shopping systems to know where everything is. Many retailers provide stock level information via their website and RFID makes it easy to accurately know how many of an item are available and where they are. So, it means I can check the stock levels of an item I want in my local high street before I make the journey. And accurate local stock level info enables the fulfilment of online orders directly from stores. RFID also makes the sell through of discontinued lines easier, because while ever there is just one item left, it can be offered to every customer online.
There are some downsides to RFID. If a tag becomes separated from its item, it means the data is no longer 100% accurate, whether that’s due to theft or simply falling off the item. You need to make a significant one-off investment in the technology to read the tags and then buy and attach tags ongoing.
It is easiest to implement RFID for retailers that sell their own brands, and so can reconfigure their production processes to add the tags at the most efficient stage of manufacture. Fashion retailers including Gap, Superdry and Marks & Spencer have successfully used RFID for several years and look set to have more retailers joining their ranks. We all know that technology gets cheaper over time and perhaps RFID is now at the stage where the payback adds up for more retailers.
New electronic shelf edge labelling technology will save retailers time and money
Ask anyone in a shop and they will tell you that time spent ensuring there is a paper ticket in front of every item is a never-ending task. Every routine price change, promotion and range change means a new batch of tickets are needed and old tickets must be removed. That’s a big job that is only added to by the mountain of promotional shelf edge labels that are needed too.
Imagine every price ticket and every promotional barker was updated by magic overnight – well that’s what having shelf edge labels is like. There is some work to make sure there is an ESL in front of every line when a display changes, but it is tiny compared to the hours spent on price tickets. The huge ticketing workload for many retailers’ promotional programmes means that colleagues strip the displays a day early and take at least half a day of the new promotional period getting the new tickets out. How many sales are lost in not having your full promo offer out for at least one day of every promotional cycle? And you can be confident that your pricing is always accurate and stop price checks too. Don’t forget the added benefit of pick-to-light to speed up your online order picking process
ESL does require some one-off tech set up and the labels are more expensive than paper. However, the real operational test is that store managers who trial the technology in their store beg their head offices to let them keep it because it makes such a difference for them.
Falling label unit prices as volume manufactured increases mean that the cost benefit ratio is slowly tipping in the favour of SEL over spending money on colleague hours, paper, and ink. Perhaps 2021 will be the year of SEL.
If you’d like external validation of savings you are making on retail tech investments, we’d be glad to help. We can quantify savings and often identify ways for you to get even more return on your investment. Contact [email protected] or call 07983 427670