Think of a new instore technology and chances are it will be found at Metro’s Future Store in Rheinberg, Germany. Self-scanning checkout systems, trolley-mounted PCs for shoppers, handheld personal digital assistants for staff, radio frequency identification (RFID) tagging, intelligent weighing scales, plasma display screens and information terminals abound.
Supported by an impressive team of IT companies, Rheinberg has been a valuable testing ground for back-office solutions and customer-facing technologies, to integrate them and provide an electronic ‘dashboard’ to monitor store activities in real time.
The trial has brought Metro worldwide plaudits and more publicity than this rather anonymous mega-retailer had hitherto encountered.
“New technology leads to more efficient processes in retailing,” says chairman and CEO Hans-Joachim Körber. “It enables us to see and respond to changing customer needs as early as possible. Rheinberg has been an important test phase for us.”
It has also proved profitable: sales at the store have increased by up to 30% since the start of the trial. Nine months into the experiment, Metro is selecting the most successful technologies and plans to roll out some of these across the group this year.
First to be implemented is the NCR FastLane self-scanning system. “This is an established product which customers readily use,” explains chief information officer Zygmunt Mierdorf. Four FastLane checkouts were installed alongside the 13 conventional checkout lanes at Metro’s Real supermarket in Ratingen shortly before Christmas. Metro says customer acceptance has been high.
Mierdorf expects all Metro’s supermarkets to offer some FastLane checkouts within the next 12 months. The company will then consider installing the self-checkouts in the 2,000-plus stores it operates in 28 countries.
Metro is also extending its use of RFID technology and aims to have 300 suppliers using it by the beginning of 2006. And in the light of consumer fears over privacy, in January the group introduced a deactivator that enables shoppers to cancel tags once they have left the store.
“We take privacy very seriously,” says Mierdorf, “but RFID is the technology that will enable a quantum leap for retailing because it allows us to cut inventory while ensuring we are never out of stock of particular lines.”
Metro is continuing item-level RFID trials in its Kaufhof department store division and is undertaking instore trials with fashion house Gerry Weber. It is also likely to turn its attention to item-level tagging in grocery, which will be particularly important when the EU’s General Food Law comes into force in 2005. This will require operators in the food supply chain to provide traceability data for their products that can be accessed by the European Food Safety Agency.
The third technology to be rolled out is an intelligent weighing scale developed in association with Bizerba. The system incorporates a digital camera that identifies the fruit or vegetables the shopper places on the scales and prices them automatically. If the system cannot identify the goods in one glance it provides a series of prompts to simplify identification. This eliminates the need for the shopper to identify their purchases from an assortment of images stuck on push-button scale displays, as happens in many UK supermarkets.
The intelligent scales at Rheinberg have been used by 62% of customers - the highest uptake of any of the new technologies. Metro plans to implement the system throughout its German supermarket operations this year.
“We have some issues to resolve in maintaining the database,” says Mierdorf. “This is easy for a single store, but becomes more complex when we want to keep a central database of the fresh fruit and vegetables that are available in all our stores and then distribute this across a powerful network.”
The aim is to link the scales in every store to the central database to give shoppers an instantaneous response.
Mierdorf adds: “The technologies we have elected for roll-out are not too futuristic. They serve the consumer most and provide us with process efficiency.” However, any further roll-outs or extensive deployment of some of the other technologies it is testing are likely to be some way in the future, perhaps a decade, says Mierdorf.