Although electronic shelf label (ESL) systems offer many benefits and South African retailers are generally beginning to see the need for them, not all ESL systems are born equal.
ESLs take care of price discrepancies at retailers, which can be a headache for both the retailer and its customers. Retailers lose revenue, customer loyalty, and incur additional costs over their competitors through labour inefficiencies when they maintain their traditional, paper-based pricing systems.
One of the greatest factors driving adoption of ESLs across the globe is the return on investment, which promises a full return within 18 to 24 months from implementation; local retailers have reported a 10% revenue improvement. In addition, lost sales are reduced due to improved stock keeping and better re-ordering information, ESLs provide absolute price consistency between regions, promote rapid and frequent micro price changes and the ability to comply with corporate promotions, and centralise pricing processes.
But not all ESL systems offer those benefits; not all will achieve that return on investment for retailers who use them. One of the primary problems is unidirectional or one-way communications.
Sending information to the shelf labels is a great idea, but being able to receive a message saying that the information was received correctly and displayed is absolutely critical to return on investment. Without that capability, retailers have to send someone to the label to check that it updated properly. And why pay for such an expensive ESL system that simply automates existing processes, but still requires a manual check of the new, automated system? It`s not good business practice because it incurs extra expense, disrupts operations, requires employee training and there`s little, if any, material gain.
The ability to do so quickly is highly beneficial, particularly in hypermarket environments where there are around 60 000 labels. Being able to update a few thousand labels in a few minutes is important, especially when it involves only one person and not a platoon of shelf packers.
The Pricer ESL system is the preferred global leader, with the top global retailers all rolling out with the two-way communications Pricer system as it ensures a robust system. The two-way communication provides full visibility, for example, to the support teams to enable them to know about a problem in the store even before the store workers know. Regional managers can pull reports on each Pricer ESL system to gather information on the status of the system, the number of updates that have been sent through, label status, and they can have it in real-time on their status screens.
These efficiencies and controls ensure better price control from the top down and lead to cost savings and reduced downtimes.
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