Electronic Shelf Labeling – What is it all about?
An electronic shelf label (ESL) system is a tool used by retailers to display specific product pricing on shelves. Electronic display modules are fixed to the front edge of the retail shelving.
These use E-paper or liquid-crystal displays (LCD) to show the product price to the customer. A communication network allows the price display to be automatically updated whenever a product price is changed. The wireless communication must have a feasible range, reliability, speed and battery life. The means of wireless communication can be based on radio, infrared or even visible light communication. Automated ESL systems reduce time and cost for pricing management, improves pricing accuracy and allows dynamic pricing. Dynamic or demand pricing is a concept by which retailers can modify pricing for a myriad of reasons, such as: to match demand, because of online competition, inventory levels, shelf life of items or to create promotions.
Maintaining correct inventory levels is essential to a business. Too much inventory leads to overstocks. Not enough inventory leads to items being out of stock. Retailers can use technology to manage the inventory management process and alert store staff when certain items are low in stock and it is time to restock.
Despite the sophistication of software, it is still an imperfect process and there will always be the capacity for human error. By understanding the full capabilities of technology available, retailers can help reduce these inaccuracies.
Electronic shelf labels (ESLs) are gaining popularity as a means of displaying and managing product pricing and information. One of the many added benefits of ESLs is the ability for shop managers and staff to use the technology behind them to help manage and control inventory levels.
Below are six ways retailers can utilise ESLs to manage stock in store.
1. Identifying Inventory Information for Customers
Initially the in-store shopper may just see an ESL as a fancy price label. But ESLs hold useful information for the customer, including showing current inventory levels without the shopper needing to find a shop assistant. When an item is out of stock, the label can display the next expected delivery date. Also, ESLs may display quick response (QR) codes; this allows shoppers to easily find the product online to order now, or make the consumer aware of availability at other nearby shops.
2. Showing Inventory Details to Retailers
For retailers and shop assistants, the small colourful digital labels contain additional essential information that may not mean anything to the shopper. Showing current inventory levels, both in store and in the backroom or warehouse, the labels may contain codes to alert shop assistants about promotions to sell a specific product, to add on items or suggested-selling and cross-selling strategies. ESLs can also identify alternate locations in-store for a product to avoid a lost sale if there is no product on the shelf.
3. Establishing Correct Inventory Levels
Adopting an ESL solution, retailers are able to react immediately to relevant inventory levels. Retailers can place slower moving products on sale earlier, they can control inventory levels for high demand and rapidly move products within departments. The technology behind ESL has so many benefits; for instance, it can indicate when to run promotions on seasonal items, thereby decreasing losses on items about to expire before they pass their sell-by-date.
4. Helping the Assistant at the Shelf Edge
With ESL, retailers can show stock information directly on the displays to help shop assistants while dealing with a customer. For example, in a shoe department, shoe-size information and availability can be displayed on the ESL at the shelf edge, allowing a shop assistant to see if a certain size is available in the back room without having to leave the customer’s side. If the size is unavailable the shop assistant can easily help the shopper find out if that product is available online or in another store close by.
5. Highlighting Inventory Levels
Data and color coding functionality on ESLs can be used to draw attention to stock that needs to be updated, that has changed location, or has been removed or replaced. This can reduce the time spent finding inventory, enabling shop assistants to focus on selling products and the requirements of shoppers and reducing labor costs associated with manually checking inventory.
6. Dealing with Products Out of Stock Before they Happen
The majority of products out of stock happen at the store level, not at the inventory management level. This may transpire from a fairly simple mistake, for instance staff not responding quickly enough to decreasing inventory levels on shelves. By linking point of sale (POS) data and inventory management tools, ESLs can alert staff when stock is running low or when it needs to be replenished before it becomes a problem. This frees up staff time to focus on selling products and delivering great customer service.
ESL technology is one way retailers can help reduce the costs associated with poor stock management. In addition to stock management and pricing display management, there are other numerous uses currently available through ESL technology and others soon to be identified. Because the technology behind ESLs has the ability to accept multiple data streams and present that data at the shelf edge in a meaningful and dynamic way in real-time, the possibilities are wide ranging.
Accurate inventory management implemented with ESL technology can be an extensive cost and time saver for both retailers and their shoppers.