As a retail business, one of the biggest decisions is what to stock on your shelves. It sounds so simple, doesn’t it? A shoe retailer sells shoes. But what shoes? Brogues, boots, formal shoes, sneakers, and many other varieties are one set of choices to make. Then there are choices of brand, color, sizes, and all of the other variations that go into setting an inventory for a store.
In the past, this was a matter of personal selection. A matter of trial and error. This leaves so much to the imagination. Perception of what might sell – or what is selling – isn’t always closely aligned to the truth. But we can embrace technology to allow this to happen. Using the right tech observes buying signals in real-time to assess how to decide what to sell or what not to sell. Both of these (what to sell or what not to sell) are viable ways of looking at the same problem. Let’s take a look in more detail at how to use tech to improve a retail store.
The benefits of knowing what to sell
Having the right stock at the right time for the right customers does many things for a retail enterprise. Money is at the core of many of the decisions we make as a business. And in retail terms, so much money is tied up in stock. It is one of the reasons why discount retailers do so well. They don’t have vast sums of money tied up in their inventory. They know what sells, they stock large amounts of it and sell it through really quickly. As many retailers operate on 90-day terms with their suppliers, this brings huge value. And knowing what sells (as well as what doesn’t sell) means that any savvy retailer can make the best decisions. Rather than having stock that sits there unsold, the retailer can sell through at the full price if only they knew what sold and what didn’t.
Another benefit that might not be as easy to measure is customer satisfaction. Nobody wants to wade through stacks of products that don’t mean anything to them in order to get to the ones they turned up for in the first place. Having a thorough knowledge of the products that your customers want enables you to have a store that is set up for their needs. This drives customer loyalty and attracts new customers too.
And all of this adds to the fine margins that we often operate in when running a retail business. The cost of opening and operating a store means that margins are under pressure all the time. Customers want the best value and the best service at the same time. We can only give them this if we’re able to manage costs effectively. Knowledge is power in retail, and technology can allow access to knowledge if it is used in the right way. We’re going to look at how this technology can be applied to great success with a wine retailer.
Case study: A wine retailer and stock
The journey of a buyer in terms of the wine they purchase is a defined one –
- Customers gain information about a wine
- They make a purchase decision
- The purchase is made
This is pretty much set in stone because wine buyers want to know what it is they are buying. It needs to have a certain taste, come from a certain country or region, certain grape varieties, go with a certain food, etc. Think of any wine store you have visited and the way it is laid out. Wine is a pleasurable thing made even more pleasurable by purchasing the ‘perfect’ solution for the occasion.
There are three things happening here in terms of the retailer –
- Which wines to stock
- The quantity of each wine to stock
- The security of that stock, as wine is generally a high-ticket item
So, they need to know what to stock, how much of it to stock, and that it isn’t going to walk out of the door under the coat of a shoplifter. And this is where the right technology answers all of these questions in one go.
Shelf intelligence gives the wine retailer absolute knowledge of everything that’s happening in their store. HLDS’s shelf intelligence allows wine retailers to have information at their fingertips about what products sell, where people congregate and what works in terms of sales promotions. In addition, it takes the potential of theft down to a minimum due to the fact that it tracks every bottle of wine in real-time.
One interesting development for wine retailers is what is known as a ‘hand detection service.’ Looking at the customer journey, information can be displayed on or near the shelf based on which bottle of wine the customer has picked up. This negates the need to have detailed descriptions for wines situated next to every single bottle. A database of information is stored, linking to the shelf intelligence systems, displaying information about the specific wine that the customer has handled. This also allows promotions or price reductions to be displayed at that very second in time – increasing sales.
Intelligent decisions on what to sell / not to sell
All of this leads to better decisions. Knowing exactly what is going on in any store every second of the opening hours is an impossible task for the human eye. It would take intuition far beyond what we have developed. But intelligent systems can track not only the movement of stock but the movement of people in any store. This makes every decision based on the ultimate level of intelligence. We know where people walk, stop, look and handle products. Wouldn’t your retail store benefit from this? If you want to have a conversation about how we could help, then please get in touch today.