"These days, stockouts can cost you more than ever"

The combination of security systems with other solutions – for instance inventory management – is a topic that is increasingly being discussed in the retail sector. At the EuroCIS 2015, we spoke with Hans-Jürgen Nausch, Global Account Manager for Checkpoint Systems, about the integration of security elements into complete solutions.

Mr. Nausch, what was the main focus of the Checkpoint Systems‘ presentation at the EuroCIS 2015?

The theme of our trade fair presentation this year was ”From Source to Shopper“. Visitors at our booth could experience how complete inventory tracking from production to the store can be implemented with RFID solutions (software, hardware and labels). The retailer is very interested in customers always finding full shelves with the desired products at the store. These days, stockouts can cost you more than ever, since competitive pressure keeps increasing. A customer, who doesn’t find the product he or she wants switches to the competition more quickly than in the past and will no longer return to the store in question for some time.

To effectively avoid empty shelves, the retailer needs to know whether the produced and ordered merchandise arrives in his warehouse in the correct quantities. When he has an overview of the stock situation from the start, he is flexible enough to decide whether the merchandise should be sold at the brick-and-mortar store or online. This flexibility is essential to restock inventory on short notice or to always have a product that sells particularly well online in stock at the respective warehouse.

The topic of continuous inventory tracking was definitely one emphasis of our appearance at the EuroCIS. We show that all processes today continue to merge and precise control over logistics processes ultimately also leads to increased sales at the store.

How does all of this work in the real world?

One problem many retailers face in the real world is that even though the merchandise has already arrived at the warehouse according to the databank, it is actually already needed in the sales room at that very moment. Thanks to the inventory tracking solution I can monitor at any time whether the merchandise has already been put away in the warehouse or whether it has just been delivered. This way I can always find the respective product quickly and remedy emerging stockouts immediately. Since I also have an overview at all times of what items with what characteristics are still in the salesroom, I am able to refill them accurately down to the individual piece. This would be the case for instance if a fashion retailer is missing one clothing item in a specific size on the shelf.

What about the topic of security – what new items did you introduce in this area?

Needless to say, security was our second focal point at the trade fair. At EuroCIS, we introduced a wireless in-store network with our newly developed complete S3i solution. Retailers can track acutely vulnerable merchandise in the store in real-time.

When merchandise secured with respective tags is brought into predefined areas – such as dressing rooms or restrooms for example -, sales assistants receive an alarm signal on their mobile devices and are able to prevent shoplifting. An offensive alarm with light or audio signals in the store is also an option of course.

But the system is even more intelligent: it also recognizes certain motion patterns, for instance if three or four of the same items are taking into a specific area. Via a map on his/her mobile device, the sales associate can see exactly what product is located in what area. However, we are clearly focusing on securing premium and upscale merchandise with this solution – this kind of comprehensive security system doesn’t pay off for every 30 Euro pair of jeans in a fashion store.

The integration of retail security solutions with other in-store applications is currently a big topic. How do you rate the options that are being offered here?

That’s right and there are many areas in retail where you can achieve positive results of course. This is why for us as a company mere article surveillance is actually no longer the main focus. Our mission is complete inventory tracking from production via the warehouse to the store. Security is more of a – albeit still important – partial aspect of the complete solution.

It is crucial that the retailer knows where his merchandise is located at all times. This information influences a whole array of other aspects, for instance the planning of marketing campaigns. On the other hand, security tags are important to ensure lucrative sales. This blend of different applications didn’t previously exist in this way and definitely not with this kind of extensive requirements. This is why you can clearly state that security in retail increasingly merges with other applications, which improve the operating performance of retailers. In many cases, this results in measurable benefits for retailers.