January 12, 2025 • 17 mins
Discover the future of retail with Simon Shankster, Director of Sales for EMEA at Focal Systems. With a keen focus on computer vision and AI, Simon shares his passion for enhancing efficiency through cutting-edge tools such as battery-powered on-shelf cameras. Hear how these advancements are not only bridging stock gaps but also revolutionising inventory management, all while upholding privacy standards. Simon provides an insider's look into how Focal Systems is reshaping the retail landscape by addressing key challenges such as loss prevention and staffing, paving the way for a more efficient and productive retail environment
In a world where effective stock management is crucial, our conversation dives into the competitive edge technology can provide to retailers. Learn how savvy tech solutions can boost shelf availability and drive sales while minimising waste, as proven by successful implementations in UK supermarkets. Simon outlines a vision of streamlined operations and rapid scalability, offering a glimpse of a promising, tech-enhanced retail future
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:01):
Welcome to the Productivity Podcast.
Today, I'm delighted to bejoined by a returning guest,
simon Shankster.
Hi Simon.
Speaker 2 (00:09):
Morning Simon.
How are you?
Speaker 1 (00:10):
Yeah, good, thank you , but you are in a new role, so
you're now the Director of Salesin MIA for Focal Systems.
Speaker 2 (00:18):
I am, yeah, a bit of a change from when we last spoke
.
It was some time ago when I wasback at ITAB.
We talked about changes duringCOVID and new norm of the
operating model.
So yeah, it's a few years agonow since we last did this.
Speaker 1 (00:32):
It is so settling into your new role.
Do you want to tell us a bitabout?
I'll call them Focal from nowon.
About Focal yeah, sure.
Speaker 2 (00:40):
So Focal were founded in 2015.
So they're based in SanFrancisco, california, and their
mission is about applying thelatest advancements in computer
vision and AI to help andoptimize retail.
So we've been doing that forkind of the last 10 years.
Shelf intelligence is where ourfocus is and that's the key
(01:02):
thing really that we've beenworking on now and I think the
reason why I spent seven yearsat ITAB before this and 25 years
in operational retail rolesprior to that.
But I think making that changeto F're really solving the right
challenges for retail with theright level of support for
(01:26):
colleagues without kind of toomuch technology, which is really
interesting, because I thinkone key thing that I'm seeing at
the moment is that for the lastfew years, retailers have been
talking more about loss andshrink and the impact of that is
obviously massive.
But I think we're starting tocome to a point where being able
to tackle it relatively limited, that no one really likes
(01:49):
defensive merchandising andanything that you do is a
deterrent with limited timelineand the consequences are fairly
futile, and I think people arestarting to see the impact on
availability as being thechallenge.
And how do we look at stockstolen not being on the shelf
for the next customer andfocusing on availability as
(02:10):
opposed to loss applies a bit ofa different perspective that's
helping make shops better, notworse.
So it's quite an interestingtime really for me to make a
change and join something that Ithink is exactly right time.
Speaker 1 (02:24):
Yeah, it's always a perfect storm, isn't it?
But it's interesting that wholeloss prevention piece can
become sales prevention.
We've seen some figures onLinkedIn recently about people
locking up kind of beers, winesand spirits and, yes, loss has
gone down, but it's alsodecimated sales.
We've talked about it to deathon the podcast, but the whole
(02:45):
change is coming in april for niand national insurance and all
the other bits for retailers.
You know, as we're time ofrecording, we've just come out
of christmas and there's alreadypeople creaking about closing
stores and doing stuff different.
So having less colleagues onthe floor which again is
counterintuitive to the wholeshrink thing, because the best
(03:06):
thing you can do, and it'sproven is have people is the
biggest deterrent.
So having less people justopens up more opportunities.
So, yeah, interesting times.
So tell us a bit about thetechnology then.
Speaker 2 (03:18):
Okay.
So the focal operating systemis made of three key things.
So the first bit is tinyon-shelf cameras and those
cameras capture an image at apredetermined frequency, so
usually every hour, and thosecameras can cover 100% of the
store.
So if you take a grocer, we cando ambient fridges, freezers,
(03:39):
loose fruit and veg.
But what's good is the camerasare battery powered so the
batteries last about two yearsand we operate focal as a
service so we can maintain thatand manage that uptime.
But it means that installationis super easy.
So to give you an example,we'll install typically about
500 cameras in a single store inusually one, maybe two nights,
(04:01):
because we haven't got loads ofcomplicated wiring and it's just
a wi-fi connection.
But the way that the cameraswork is that they're asleep for
most of the time.
So we're not into gdpr andidentifiable information.
The cameras are asleep.
They wake up at their allottedtime slot, capture an image,
upload that optimized via wi-fiback to sleep and that's why the
(04:24):
batteries last so long.
So the first part is thecameras.
The second part is the cleverbit, the deep learning platform.
So we translate those imagesinto GDPR compliant actions for
store colleagues, so we don'tcapture any images of people.
The first thing that we do is,if someone happens to be stood
in the way at the point thatcamera captures the image, all
(04:46):
of the pixels drop.
So we do not process or storeanything that sees a person.
And I think you kind of talkabout putting 500 cameras in a
supermarket and everybody panicsand says it's Big Brother
watching you, and it reallyisn't that at all.
But the platform, then, becausewe have a direct feed to store
(05:06):
inventory file and an hourlysales data, we can accurately
measure gaps, lows and planogramissues and we present them back
to the colleague via theirexisting handheld device.
So what it means is, if youhave a gap on the shelf and your
stock file suggests that youhave that stock is, if you have
a gap on the shelf and yourstock file suggests that you
(05:27):
have that stock, we only presentthe things that you can do
something about.
So the store colleague on theirhandheld, whatever they've got,
will have something called thefocal action tool and what that
does is it comes up and sayshere are the jobs that you
should do in a priority order.
So, for example, it defaults byvalue, so it applies a value,
but what it could do is say,actually these top 200 lines are
(05:49):
the most important lines for mycustomers.
Therefore we solve thoseproblems first.
It might be followed bypromotional activity that have a
higher value so that's what youdo next.
But we're able to really helpthe colleague know what to do
and where to go.
So, for example, if somethingis a gap on shelf but it's
available on a promotionalfeature, our system will be able
(06:13):
to steer the colleague to sayit's a gap here, but I can see
it is in stock there.
So your task is to spread thatstock out or merchandise that
stock on the shelf.
So we're only giving thecolleagues activity that they
can really do something about.
So at the moment in a store youwould have a gap scan process
(06:33):
of some type, whether that'sonce a day.
Some retailers do it twice aday, three times a day,
depending on who they are, buttypically a once a day gap scan.
We're replacing that with anhourly gap scan, so 15 gap scans
a day.
But we're only thenhighlighting the tasks that you
can do something about, andthat's where it becomes really
clever.
Speaker 1 (06:53):
Yeah so presenting those actionable insights is an
important part, isn't it?
Speaker 2 (06:57):
Completely, because at the moment, you'd scan a gap
not knowing whether you can dosomething about that or not,
whereas we ignore all of that.
We do that work for the store.
So we're saying, actually, thisis what you've got, these are
the things that you can dosomething about.
And the third and final part isthe reporting and dashboards.
Never before has a retailerbeen able to see availability in
(07:19):
the same way that the customeris seeing it.
This is true on-shelfavailability.
So not a supply chain metric,but uh, what is your customer
seeing in terms of gaps?
And we measure that by hour, byday, by store, by region, by
group.
So, using specific store salesdata, we can also present the
value of lost sales or, moreimportantly, recovered sales, so
(07:43):
that data can then be used tosupport supply chain layout,
range colleagues, scheduling, aswell as making it better for
shoppers.
And we gamify that as well in away that sort of allows you to
celebrate great colleagues, soyou're able to say, look, well
done today, simon, you've done agreat job and you've recovered
two thousand pounds worth ofsales through your activity and
(08:05):
a task that you've completed andthat becomes really powerful to
.
It's the first time I've everseen a gap related to a physical
pound note applicable to thatstore, which is quite
interesting yeah, no, it is.
Speaker 1 (08:18):
And again I suppose you then get into all the
nuances of retail for those thatwork in it.
So dual locations, promotionalends where we might have the
stock in one place, so it showsstock on hand, not necessarily
the warehouse, and I suppose inthis day and age overstock
shelves as well, and then thatthen transposes into a gap
somewhere else and againpotential lost sale yeah, and
(08:40):
that's the difference is wedon't just say, oh, by the way,
you have this stock and it's ona promotional feature somewhere.
Speaker 2 (08:46):
We say we have this stock, it's on promotion feature
seven.
Here's a store map that showsyou where it is, and I can see
that that stock is there now.
So it becomes really targeted,because if it's a gap on both,
it's a gap on both.
That's the supply chain issues.
No point in a store colleaguerunning around.
And back to your point aboutshrink.
(09:06):
What this does is keepcolleagues on the shop floor and
the right place that they'redoing.
And this isn't about well, itcould be about saving hours, but
it could be about redeployinghours to say, make you visible,
to give great service, asopposed to running backwards and
forwards to the warehouse tosee if something's there when a
customer asks you.
So it's just really aboutimproving the efficiency of
colleagues and putting them inthe right place, where the
(09:27):
customers need them to be.
Speaker 1 (09:28):
Yeah, one of the things we're looking to prove
out this year is the cost oftouching stock.
So you know, I'll give theexample you, your delivery,
comes in at the back door, letsyou supermarkets, because we all
go there.
Tray of beans comes in, sothere might be I don't know 24
tins on a tray.
Tray goes out, shelf is full,goes back in the warehouse two
(09:48):
days later goes out.
Shelves fall back in thewarehouse two days later goes
out.
Six tins go out, go back in thewarehouse.
Because of the cost pressures.
You come to a point, with thehourly rate and all the on costs
that are coming, that it'sprobably a negative.
It's not worth you selling thatproduct because you've spent
more labour putting it out thanthe cost of the product.
Speaker 2 (10:09):
Now yeah, and we've started to see similar where
we're working with someretailers in the US where,
because we know shelf capacityand case sizes, we're able to
walk the warehouse scan andit'll say whether that whole
case will go out or not.
Which means, instead of pickingone and saying, don't bother,
just pick it when a case goesout and let's be really
(10:31):
efficient, because there's nopoint in taking one.
It adds no value.
So it's being able to translatethe least amount of moves that
a colleague needs to do tocreate the best availability
that you can give to yourcustomers throughout the trading
day.
Speaker 1 (10:45):
Yeah, that makes sense.
So there's lots of kind of keybenefits you've talked about
productivity shrink and then allthese halo benefits around
sales.
So in any retailer, the moresales you can drive, you
typically then get the benefitof maybe having more colleagues
in the next budget round and itmeans that your waste numbers
aren't as aggressive, et cetera,because it's all a volume game,
(11:06):
right.
Speaker 2 (11:07):
Definitely definitely .
And, I think, the key benefitsobviously look, productivity is
the key one, the operationalsaving element.
If you're taking away a processthat takes you four or five
hours a day and you don't haveto do that any day at all, all
of a sudden all of those hoursbecome available to do something
else with.
But actually the second key bitis the sales increase.
(11:28):
So largely the measurement isabout 1% increase in
availability is about half apercent increase in sales and
we're seeing uplifts of 2%, 3%,4% in availability in many, many
stores and we've nowimplemented this shelf edge tech
across 15 retailers on threecontinents.
We've got a national UKsupermarket rollout, so we're in
(11:51):
500 stores that we deal with insix months and that's resulting
in a 2% on shelf availabilityimprovement and the savings that
go with it.
So we know that they're thebenefits that are helping.
But then you start to get addedones, like if your stock falls
more in order, then your back ofhouse starts to drop.
So we're typically seeingaround a third reduction in
(12:14):
those stores in the UK and storemanagers are reporting waste
reductions of up to about athousand pounds a week to say
you know, I'm throwing less awaybecause I'm getting the right
stock in the right flow.
So and then when you start tolay out, to say, okay, you can
see this stuff, what else couldyou do?
But actually we're looking atthings like theft reporting.
So we saw a product, then wedidn't see a product, but we
(12:37):
didn't see a sale, which is wedidn't see a sale, which is
quite interesting.
And we're just starting to workon that now to be able to say
how do we translate that into anaction, as well as things like
scanning back of house soimmediately know if that product
will go out, or whether we dothings like emergency product
withdrawal, so these mince pieshave to be removed immediately.
(12:58):
Well, not only can we force thecompliance, but we can also
then see that these tasks havebeen done.
So the dashboard allows headoffices to be able to sit and
literally store walk any storeon the estate within the last
hour to have a look at how wellit's presented and what their
real availability and what theircustomers see.
And we put my regional managerhat on.
(13:21):
It's kind of brilliant and alittle bit scary at the same
time, but it's powerful to beable to really see.
You know what the stores looklike and what are we showing
customers every single hour ofthe day and you know some of the
figures we're seeing at end ofday out of stocks, you know 5pm,
6pm, 7pm are so much less thanwhat they've ever been before,
(13:43):
because you're not leaving ittill overnight, you're tackling
it through the day.
So, yeah, it's, it's as I say.
I think we're starting totackle the things that are
really topical at the momentwith retailers that you know we
can help them do things a littlebit easier, which is always a
big thing for me.
Speaker 1 (14:00):
Yeah, and with that ease of install kind of low-tech
overhead points of view, makesa massive difference because if
it becomes some big install jobwith lots of contractors and
lots of wires and cables goingeverywhere we all know back to
my days at Boots every shot wasdifferent and it becomes a
project within a project.
Speaker 2 (14:20):
Yeah, I think there's two things.
I think there's the tech thingand I think there's a property
thing.
I think the property thing youget into the world of of various
regulations and this buildinggot asbestos and all of those
things.
But from a tech point of view,you know, we, we aim to be the
lightest possible touch to try,because as soon as you try and
get on any kind of tech roadmap,it's two, three years.
(14:41):
You know, this is kind of going.
We can try this withoutdisturbing anybody or anything
and let's see what this does andthat that's that's what's
really helping us accelerate.
You know the retailer in the uk.
Speaker 1 (14:53):
They did one store, six stores, 500 stores within
six months, and that's, that'swhat's exciting yeah, amazing
good stuff and again widerbenefits, so lots of electronic
shelf edge labels and those typeof things.
So there must be a benefit oflinking the two so you can do
some fancy stuff yeah,definitely we've.
Speaker 2 (15:14):
We've started to do that quite recently where, if we
can combine what a shelf edgelabel sees with our data, we're
able to do a couple of things.
So one is we can enable pick bylight, so if a colleague has a
task, we can flash the edgelabel to help the colleague find
that gap quicker.
But also we can automate thingsthat automate messaging.
(15:36):
So, for example, we confirmthat that product is not
available.
Therefore, we can translatethat to a message to the
customer that says it'stemporarily unavailable, or tell
them that it's availablesomewhere else in the store.
So we can start to use thatmessaging to say your customer
sees the price, but we can thenlayer on some of the messaging
(15:56):
that they weren't able to havebefore.
So I think there's definitelysome interlock between at-shelf
tech, whether that's ESLs orcameras.
I think the two things do startto fit together in some way.
Speaker 1 (16:09):
Yeah, the whole universe of connected things.
It's just getting stronger andstronger, isn't it?
And then you get clearly thehalo effect of all the
additional benefits because thetech's already there.
Actually, how can you work withothers to provide those deeper
insights?
Speaker 2 (16:23):
yeah, and I think we have a responsibility, I think
when we work with retailers, Ithink it shouldn't be up to the
retailers to try and work outall of the different
complementary bits of tech, andI think you know I've always
worked in the same way.
The same as you have is to beable to sort of say, well, how
come what we do complement otherthings that are already
available and take some of thatlegwork away for the retailers.
So it's a good way to work, Ithink yeah, absolutely.
Speaker 1 (16:47):
And on that point then, if people are interested,
it's sparked some kind of umquestions in their minds what's
the best way for them to get intouch with you?
Speaker 2 (16:56):
um, so there's a couple of things.
We we're doing a number of themain shows, so, depending on
timing of when this goes out,but we'll be at NRF.
We're also at Eurosys inFebruary, but if anybody wants
to kind of contact me direct,you can find me very easily on
LinkedIn.
Just drop me a message.
I'd be more than happy to chat.
Speaker 1 (17:17):
Perfect Good.
Well, it's great to catch upagain.
Glad you've settled into yournew role.
Speaker 2 (17:21):
it sounds like there's some exciting
developments ahead absolutely,absolutely, yeah, and it's been
really good, really good to talkto you again.
I appreciate your timebrilliant thanks, simon.
Speaker 1 (17:29):
Catch up soon, cheers .
Thank you.
Welcome to the Productivity Podcast.
Today, I'm delighted to bejoined by a returning guest,
simon Shankster.
Hi Simon.
Speaker 2 (00:09):
Morning Simon.
How are you?
Speaker 1 (00:10):
Yeah, good, thank you , but you are in a new role, so
you're now the Director of Salesin MIA for Focal Systems.
Speaker 2 (00:18):
I am, yeah, a bit of a change from when we last spoke
.
It was some time ago when I wasback at ITAB.
We talked about changes duringCOVID and new norm of the
operating model.
So yeah, it's a few years agonow since we last did this.
Speaker 1 (00:32):
It is so settling into your new role.
Do you want to tell us a bitabout?
I'll call them Focal from nowon.
About Focal yeah, sure.
Speaker 2 (00:40):
So Focal were founded in 2015.
So they're based in SanFrancisco, california, and their
mission is about applying thelatest advancements in computer
vision and AI to help andoptimize retail.
So we've been doing that forkind of the last 10 years.
Shelf intelligence is where ourfocus is and that's the key
(01:02):
thing really that we've beenworking on now and I think the
reason why I spent seven yearsat ITAB before this and 25 years
in operational retail rolesprior to that.
But I think making that changeto F're really solving the right
challenges for retail with theright level of support for
(01:26):
colleagues without kind of toomuch technology, which is really
interesting, because I thinkone key thing that I'm seeing at
the moment is that for the lastfew years, retailers have been
talking more about loss andshrink and the impact of that is
obviously massive.
But I think we're starting tocome to a point where being able
to tackle it relatively limited, that no one really likes
(01:49):
defensive merchandising andanything that you do is a
deterrent with limited timelineand the consequences are fairly
futile, and I think people arestarting to see the impact on
availability as being thechallenge.
And how do we look at stockstolen not being on the shelf
for the next customer andfocusing on availability as
(02:10):
opposed to loss applies a bit ofa different perspective that's
helping make shops better, notworse.
So it's quite an interestingtime really for me to make a
change and join something that Ithink is exactly right time.
Speaker 1 (02:24):
Yeah, it's always a perfect storm, isn't it?
But it's interesting that wholeloss prevention piece can
become sales prevention.
We've seen some figures onLinkedIn recently about people
locking up kind of beers, winesand spirits and, yes, loss has
gone down, but it's alsodecimated sales.
We've talked about it to deathon the podcast, but the whole
(02:45):
change is coming in april for niand national insurance and all
the other bits for retailers.
You know, as we're time ofrecording, we've just come out
of christmas and there's alreadypeople creaking about closing
stores and doing stuff different.
So having less colleagues onthe floor which again is
counterintuitive to the wholeshrink thing, because the best
(03:06):
thing you can do, and it'sproven is have people is the
biggest deterrent.
So having less people justopens up more opportunities.
So, yeah, interesting times.
So tell us a bit about thetechnology then.
Speaker 2 (03:18):
Okay.
So the focal operating systemis made of three key things.
So the first bit is tinyon-shelf cameras and those
cameras capture an image at apredetermined frequency, so
usually every hour, and thosecameras can cover 100% of the
store.
So if you take a grocer, we cando ambient fridges, freezers,
(03:39):
loose fruit and veg.
But what's good is the camerasare battery powered so the
batteries last about two yearsand we operate focal as a
service so we can maintain thatand manage that uptime.
But it means that installationis super easy.
So to give you an example,we'll install typically about
500 cameras in a single store inusually one, maybe two nights,
(04:01):
because we haven't got loads ofcomplicated wiring and it's just
a wi-fi connection.
But the way that the cameraswork is that they're asleep for
most of the time.
So we're not into gdpr andidentifiable information.
The cameras are asleep.
They wake up at their allottedtime slot, capture an image,
upload that optimized via wi-fiback to sleep and that's why the
(04:24):
batteries last so long.
So the first part is thecameras.
The second part is the cleverbit, the deep learning platform.
So we translate those imagesinto GDPR compliant actions for
store colleagues, so we don'tcapture any images of people.
The first thing that we do is,if someone happens to be stood
in the way at the point thatcamera captures the image, all
(04:46):
of the pixels drop.
So we do not process or storeanything that sees a person.
And I think you kind of talkabout putting 500 cameras in a
supermarket and everybody panicsand says it's Big Brother
watching you, and it reallyisn't that at all.
But the platform, then, becausewe have a direct feed to store
(05:06):
inventory file and an hourlysales data, we can accurately
measure gaps, lows and planogramissues and we present them back
to the colleague via theirexisting handheld device.
So what it means is, if youhave a gap on the shelf and your
stock file suggests that youhave that stock is, if you have
a gap on the shelf and yourstock file suggests that you
(05:27):
have that stock, we only presentthe things that you can do
something about.
So the store colleague on theirhandheld, whatever they've got,
will have something called thefocal action tool and what that
does is it comes up and sayshere are the jobs that you
should do in a priority order.
So, for example, it defaults byvalue, so it applies a value,
but what it could do is say,actually these top 200 lines are
(05:49):
the most important lines for mycustomers.
Therefore we solve thoseproblems first.
It might be followed bypromotional activity that have a
higher value so that's what youdo next.
But we're able to really helpthe colleague know what to do
and where to go.
So, for example, if somethingis a gap on shelf but it's
available on a promotionalfeature, our system will be able
(06:13):
to steer the colleague to sayit's a gap here, but I can see
it is in stock there.
So your task is to spread thatstock out or merchandise that
stock on the shelf.
So we're only giving thecolleagues activity that they
can really do something about.
So at the moment in a store youwould have a gap scan process
(06:33):
of some type, whether that'sonce a day.
Some retailers do it twice aday, three times a day,
depending on who they are, buttypically a once a day gap scan.
We're replacing that with anhourly gap scan, so 15 gap scans
a day.
But we're only thenhighlighting the tasks that you
can do something about, andthat's where it becomes really
clever.
Speaker 1 (06:53):
Yeah so presenting those actionable insights is an
important part, isn't it?
Speaker 2 (06:57):
Completely, because at the moment, you'd scan a gap
not knowing whether you can dosomething about that or not,
whereas we ignore all of that.
We do that work for the store.
So we're saying, actually, thisis what you've got, these are
the things that you can dosomething about.
And the third and final part isthe reporting and dashboards.
Never before has a retailerbeen able to see availability in
(07:19):
the same way that the customeris seeing it.
This is true on-shelfavailability.
So not a supply chain metric,but uh, what is your customer
seeing in terms of gaps?
And we measure that by hour, byday, by store, by region, by
group.
So, using specific store salesdata, we can also present the
value of lost sales or, moreimportantly, recovered sales, so
(07:43):
that data can then be used tosupport supply chain layout,
range colleagues, scheduling, aswell as making it better for
shoppers.
And we gamify that as well in away that sort of allows you to
celebrate great colleagues, soyou're able to say, look, well
done today, simon, you've done agreat job and you've recovered
two thousand pounds worth ofsales through your activity and
(08:05):
a task that you've completed andthat becomes really powerful to
.
It's the first time I've everseen a gap related to a physical
pound note applicable to thatstore, which is quite
interesting yeah, no, it is.
Speaker 1 (08:18):
And again I suppose you then get into all the
nuances of retail for those thatwork in it.
So dual locations, promotionalends where we might have the
stock in one place, so it showsstock on hand, not necessarily
the warehouse, and I suppose inthis day and age overstock
shelves as well, and then thatthen transposes into a gap
somewhere else and againpotential lost sale yeah, and
(08:40):
that's the difference is wedon't just say, oh, by the way,
you have this stock and it's ona promotional feature somewhere.
Speaker 2 (08:46):
We say we have this stock, it's on promotion feature
seven.
Here's a store map that showsyou where it is, and I can see
that that stock is there now.
So it becomes really targeted,because if it's a gap on both,
it's a gap on both.
That's the supply chain issues.
No point in a store colleaguerunning around.
And back to your point aboutshrink.
(09:06):
What this does is keepcolleagues on the shop floor and
the right place that they'redoing.
And this isn't about well, itcould be about saving hours, but
it could be about redeployinghours to say, make you visible,
to give great service, asopposed to running backwards and
forwards to the warehouse tosee if something's there when a
customer asks you.
So it's just really aboutimproving the efficiency of
colleagues and putting them inthe right place, where the
(09:27):
customers need them to be.
Speaker 1 (09:28):
Yeah, one of the things we're looking to prove
out this year is the cost oftouching stock.
So you know, I'll give theexample you, your delivery,
comes in at the back door, letsyou supermarkets, because we all
go there.
Tray of beans comes in, sothere might be I don't know 24
tins on a tray.
Tray goes out, shelf is full,goes back in the warehouse two
(09:48):
days later goes out.
Shelves fall back in thewarehouse two days later goes
out.
Six tins go out, go back in thewarehouse.
Because of the cost pressures.
You come to a point, with thehourly rate and all the on costs
that are coming, that it'sprobably a negative.
It's not worth you selling thatproduct because you've spent
more labour putting it out thanthe cost of the product.
Speaker 2 (10:09):
Now yeah, and we've started to see similar where
we're working with someretailers in the US where,
because we know shelf capacityand case sizes, we're able to
walk the warehouse scan andit'll say whether that whole
case will go out or not.
Which means, instead of pickingone and saying, don't bother,
just pick it when a case goesout and let's be really
(10:31):
efficient, because there's nopoint in taking one.
It adds no value.
So it's being able to translatethe least amount of moves that
a colleague needs to do tocreate the best availability
that you can give to yourcustomers throughout the trading
day.
Speaker 1 (10:45):
Yeah, that makes sense.
So there's lots of kind of keybenefits you've talked about
productivity shrink and then allthese halo benefits around
sales.
So in any retailer, the moresales you can drive, you
typically then get the benefitof maybe having more colleagues
in the next budget round and itmeans that your waste numbers
aren't as aggressive, et cetera,because it's all a volume game,
(11:06):
right.
Speaker 2 (11:07):
Definitely definitely .
And, I think, the key benefitsobviously look, productivity is
the key one, the operationalsaving element.
If you're taking away a processthat takes you four or five
hours a day and you don't haveto do that any day at all, all
of a sudden all of those hoursbecome available to do something
else with.
But actually the second key bitis the sales increase.
(11:28):
So largely the measurement isabout 1% increase in
availability is about half apercent increase in sales and
we're seeing uplifts of 2%, 3%,4% in availability in many, many
stores and we've nowimplemented this shelf edge tech
across 15 retailers on threecontinents.
We've got a national UKsupermarket rollout, so we're in
(11:51):
500 stores that we deal with insix months and that's resulting
in a 2% on shelf availabilityimprovement and the savings that
go with it.
So we know that they're thebenefits that are helping.
But then you start to get addedones, like if your stock falls
more in order, then your back ofhouse starts to drop.
So we're typically seeingaround a third reduction in
(12:14):
those stores in the UK and storemanagers are reporting waste
reductions of up to about athousand pounds a week to say
you know, I'm throwing less awaybecause I'm getting the right
stock in the right flow.
So and then when you start tolay out, to say, okay, you can
see this stuff, what else couldyou do?
But actually we're looking atthings like theft reporting.
So we saw a product, then wedidn't see a product, but we
(12:37):
didn't see a sale, which is wedidn't see a sale, which is
quite interesting.
And we're just starting to workon that now to be able to say
how do we translate that into anaction, as well as things like
scanning back of house soimmediately know if that product
will go out, or whether we dothings like emergency product
withdrawal, so these mince pieshave to be removed immediately.
(12:58):
Well, not only can we force thecompliance, but we can also
then see that these tasks havebeen done.
So the dashboard allows headoffices to be able to sit and
literally store walk any storeon the estate within the last
hour to have a look at how wellit's presented and what their
real availability and what theircustomers see.
And we put my regional managerhat on.
(13:21):
It's kind of brilliant and alittle bit scary at the same
time, but it's powerful to beable to really see.
You know what the stores looklike and what are we showing
customers every single hour ofthe day and you know some of the
figures we're seeing at end ofday out of stocks, you know 5pm,
6pm, 7pm are so much less thanwhat they've ever been before,
(13:43):
because you're not leaving ittill overnight, you're tackling
it through the day.
So, yeah, it's, it's as I say.
I think we're starting totackle the things that are
really topical at the momentwith retailers that you know we
can help them do things a littlebit easier, which is always a
big thing for me.
Speaker 1 (14:00):
Yeah, and with that ease of install kind of low-tech
overhead points of view, makesa massive difference because if
it becomes some big install jobwith lots of contractors and
lots of wires and cables goingeverywhere we all know back to
my days at Boots every shot wasdifferent and it becomes a
project within a project.
Speaker 2 (14:20):
Yeah, I think there's two things.
I think there's the tech thingand I think there's a property
thing.
I think the property thing youget into the world of of various
regulations and this buildinggot asbestos and all of those
things.
But from a tech point of view,you know, we, we aim to be the
lightest possible touch to try,because as soon as you try and
get on any kind of tech roadmap,it's two, three years.
(14:41):
You know, this is kind of going.
We can try this withoutdisturbing anybody or anything
and let's see what this does andthat that's that's what's
really helping us accelerate.
You know the retailer in the uk.
Speaker 1 (14:53):
They did one store, six stores, 500 stores within
six months, and that's, that'swhat's exciting yeah, amazing
good stuff and again widerbenefits, so lots of electronic
shelf edge labels and those typeof things.
So there must be a benefit oflinking the two so you can do
some fancy stuff yeah,definitely we've.
Speaker 2 (15:14):
We've started to do that quite recently where, if we
can combine what a shelf edgelabel sees with our data, we're
able to do a couple of things.
So one is we can enable pick bylight, so if a colleague has a
task, we can flash the edgelabel to help the colleague find
that gap quicker.
But also we can automate thingsthat automate messaging.
(15:36):
So, for example, we confirmthat that product is not
available.
Therefore, we can translatethat to a message to the
customer that says it'stemporarily unavailable, or tell
them that it's availablesomewhere else in the store.
So we can start to use thatmessaging to say your customer
sees the price, but we can thenlayer on some of the messaging
(15:56):
that they weren't able to havebefore.
So I think there's definitelysome interlock between at-shelf
tech, whether that's ESLs orcameras.
I think the two things do startto fit together in some way.
Speaker 1 (16:09):
Yeah, the whole universe of connected things.
It's just getting stronger andstronger, isn't it?
And then you get clearly thehalo effect of all the
additional benefits because thetech's already there.
Actually, how can you work withothers to provide those deeper
insights?
Speaker 2 (16:23):
yeah, and I think we have a responsibility, I think
when we work with retailers, Ithink it shouldn't be up to the
retailers to try and work outall of the different
complementary bits of tech, andI think you know I've always
worked in the same way.
The same as you have is to beable to sort of say, well, how
come what we do complement otherthings that are already
available and take some of thatlegwork away for the retailers.
So it's a good way to work, Ithink yeah, absolutely.
Speaker 1 (16:47):
And on that point then, if people are interested,
it's sparked some kind of umquestions in their minds what's
the best way for them to get intouch with you?
Speaker 2 (16:56):
um, so there's a couple of things.
We we're doing a number of themain shows, so, depending on
timing of when this goes out,but we'll be at NRF.
We're also at Eurosys inFebruary, but if anybody wants
to kind of contact me direct,you can find me very easily on
LinkedIn.
Just drop me a message.
I'd be more than happy to chat.
Speaker 1 (17:17):
Perfect Good.
Well, it's great to catch upagain.
Glad you've settled into yournew role.
Speaker 2 (17:21):
it sounds like there's some exciting
developments ahead absolutely,absolutely, yeah, and it's been
really good, really good to talkto you again.
I appreciate your timebrilliant thanks, simon.
Speaker 1 (17:29):
Catch up soon, cheers .
Thank you.
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