Retail Automation: A Complete Guide To Level Up Your Business
TL;DR: Retail Automation is an advanced digital solution that has opened up horizons to more secure, efficient, and scalable operations. It combines advanced technologies like AI, AR, RPA, etc., to design a solution that improves the current workflow while making the business ready for the future. From its various benefits to actual examples, there are many factors evidencing its positive impact on overall functionalities.
People thought that digitalizing the retail industry was limited to just eCommerce platforms or building a digital shopfront. But no! When it comes to digital transformation, the scope is almost endless, and now it is shifting towards retail store automation.
What Is Retail Automation?
Automation is an approach in which multiple technologies, programs, and tools are combined to create a singular solution. The main objectives are to improve operational efficiency and reduce manual labor.
Automation in retail comprises using innovative tools to streamline operations and speed up processes. The target departments are those with repetitive, rule-based, or tedious, highly labor-intensive tasks.
For example, customer queries and services, inventory management, marketing campaigns, and data-driven strategies are some of the many departments that retail automation can optimize.
Benefits Of Automation In Retail
Improved System Security
All the manual processes make retailers easy targets for fraud and deceit. Many have even become victims of such fraudulent activities and have lost a fortune. But with digital integrations like currency detection, multi-step authentication, and more, you can easily encrypt your data and make it more secure.
Additionally, an automated system to track orders and check daily revenue and customer data collection will ensure that all the data is well-organized and isn’t tampered with by anyone.
Enhanced Customer Experience
With every business taking the customer-centric services path, it’s time for retail services to follow suit. Retail automation can leverage many benefits, such as shorter queues, faster assistance, custom marketing campaigns, and more.
Powered by modern tech, automation streamlines the work and, at the same time, increases customer satisfaction with your convenient services.
Reduction In Operational Costs
With retail automation, operational costs can be reduced by a significant margin. You or your staff don’t have to spend hours and hours filling out sheet after sheets of customer data, inventory details, and countless emails to customers. The machine can do that for you.
What’s more, when done by machine, the data entered isn’t biased, incorrect, or misleading. Thus, not only does it reduce the cost, but it also improves the quality.
Improved Efficiency
Process automation helps you identify the best possible route to maximize resource utilization and reduce wastage. Streamlined workflow and longer resource lifespans reduce manual burden and improve productivity.
Other aspects of an efficient working system are consistent services, faster order management, extensive customer support, and more.
Better Agility And Scalability
Integrating your business with advanced technology improves the overall functionality and makes it adaptable to future advancements. Not just that, automating operations also implies seamless upscaling as and when needed.
With business process automation in retail comes optimal agility and effortless upscaling across multiple departments and functionalities.
Top Use Cases Of Retail Automation
Inventory Management
Challenge
Difficulty in maintaining the proper inventory records at regular intervals. Requires a lot of employee time and is prone to errors.
Solution
The ideal solution for this would be an automated AI/ML-powered inventory management system and barcode technology. By integrating that, you can scan the products and get real-time updates on the current status of product stock.
The system automates the data entry and maintenance process, thus saving time and resources. Additionally, it can also become the converging point for multiple sales channels and get better revenue generation.
Example
Many grocery stores, such as IKEA, Walmart, Target, etc., simplify shopping with inventory management systems. Customers place their orders on mobile apps and pick them up at their convenience, reducing the crowd and speeding up the process. This also helps them converge all of their sales points in one place.
Related Read – Orderhive – A comprehensive SaaS-based inventory management product that allows retailers to fully automate different aspects of their inventory management.
Marketing Campaigns
Challenge
Difficulty in assessing the large volumes of data to build the right marketing strategy, leading to tedious and ineffective marketing campaigns.
Solution
A combination of IoT and retail automation is the perfect choice for this, as the former identifies customer patterns, and the latter helps curate the ideal marketing strategies. With such targeted marketing campaigns, you increase user engagement, maintain brand value, and thereby increase revenue.
AI-driven solutions also help design personalized campaigns, such as sending relevant emails and informing users about new collections, offers, etc., which further improves user experience.
Example
Retail apparel brands like H&M, Zara, etc., promote their new launches, relevant(limited-time period) offers, and promotion codes to encourage users to engage with their content and purchase their products.
Order And Return Management
Challenge
Fulfilling an order or managing returns takes a lot of time due to third-party involvement in shipping, delivering, and other logistics processing.
Solution
The best approach to streamline and quicken the process would be to first reduce the points of contact between different parties to a single platform and then implement automation strategies.
One aspect is employing automated logistics processes to track shipments, manage warehouse inventory, and fulfill orders. The second is improving customer experience by automating returns and faster refunds.
Example
Amazon, one of the biggest global eCommerce platforms, is known for its faster order delivery and returns. The vast network of buyers and sellers is handled via numerous connections of automated systems that converge in a single order management system. This is where all the different processes come together and collaborate to create a streamlined process.
We created a warehouse management application for Mover Storage, which has a custom warehouse to accommodate large-scale production and offline sync for streamlined operations.
Outlet Automation
Challenge
Rush hours at retail stores make shopping a hassle. Long queues and crowded lanes hamper the overall flow of the store and negatively affect the customer experience.
Solution
With a few technological integrations, your store can be transformed to obtain optimal functionality and improve user experience. For example, you can identify busy aisles via sensors and determine the best product placement to prevent crowding and ensure effective handling.
Similarly, you can reduce the lines during rush hours by allowing your customers to purchase online and pick up their stuff from the store or by allowing self-checkout and contactless payments (via QR codes, wallet payments, etc.).
Example
Many stores, such as Target and Home Depot, have self-checkout systems, so customers don’t have to wait in long queues. These systems also free up employees to complete other tasks. However, they still require the presence of a staff member to help customers when they scan their products to avoid errors during the procedure.
Central Management Systems
Challenge
Inadequate documentation makes maintaining accurate records of employee information, attendance, shifts, leaves, and salaries challenging.
Solution
Establish a proper CMS system to manage all staff-related information in one place. The best part is that it can be customized per your requirements and will act as a single official communication system. All it requires is creating an employee ID and a navigational portal in the form of a web or mobile app.
Add an automated salary system to provide on-time payments and sanction automated bonuses (if applicable). You can also automatize attendance by adding biometric sensors. What’s more? This system can be beneficial for both you and the employees as it helps them keep track of working shifts and leaves.
Example
Many large-scale retailers have employed these automated management systems to maintain their huge workforce and establish a better working environment through retail automation.
Retail Automation Implementation Strategies
While automated retailing finds use cases in many sectors of the industry, the key to successful integration is to proceed step-by-step and with thorough consideration. To explain them in detail:
Steps To Implement Retail Store Automation
Automation is already a complicated process. So let us simplify the process for you with these five steps that can help you get started:
Step 1: Roadmapping The Process
Analyze your process and identify the scope of automation in repetitive tasks like customer service, inventory management, etc. Based on the acquired data, the proper automation strategy will be designed.
Step 2: Choose The Right Technology And Process
The next step is to find the technology that resolves your problem statements from step 1. Then, look through different integration processes to see what would be best for you—an off-the-shelf approach or custom solutions.
Step 3: Partner With A Good Service Provider
Okay, so the analysis is done, the digital solution is shortlisted, and you have decided whether to go with custom or off-the-shelf services. Now, you need to connect with a service provider who understands your requirements and optimal & secure solutions.
Step 4: Invest In Employee Training
While the development service providers design excellence for your business, you need to include your workforce in the process, inform them about the upcoming changes, and provide relevant training. This will help them get familiar with the changes and ensure a streamlined integration.
Step 5: Monitor, Evaluate And Upgrade
Once integrated, these retail automation solutions will be tested by actual users. Be open to reviews and monitor how it is improving your overall business workflow. This data will help you understand what requires updates and what works in sync with you for an optimal solution.
For In-Depth Insight, Check Out – Digital Transformation In Retail
What Must You Keep In Mind When Implementing Automation In Retail?
While the steps might simplify the integration, a few strategies can further assist you in maximizing the investment benefits of retail automation.
First is the cost; digital solutions command a fortune and thus require thorough research and discussions, especially if it is a large-scale project. So, you must connect with multiple software vendors and get different price quotations along with the services they are offering before you make a decision.
Second, do not follow trends. The beauty and complexity of these advanced technologies is that they do not follow a one-size-fits-all approach. So don’t spend your resources on automation technology just because your competitor has done that. However, when your business demands technical assistance, go forward with experts in the field.
Next is security since the automation solution will collect and store a lot of data, including customer details, the store’s financial and operational data, and other critical information. Ensure that all the required security measures are implemented during development.
Lastly, thorough testing. Make sure that all the designed solutions are tested well enough to eliminate any bugs, security concerns, or performance-related issues. This will improve the longevity and quality of the final product, ensuring there’s no immediate repair/upgrade expense.
Key Technologies That Power Retail Automation
As mentioned in the “What is retail automation?” section, automation is a combination of technologies pieced together to design a complete solution. While the list of technologies can go on endlessly, there are some crucial ones without which automation is almost impossible to achieve.
The top technologies that drive retail automation are:
Artificial Intelligence
Artificial intelligence is driving the whole digital transformation at the moment, and automation in retail is just a small aspect of this drive.
It automates processes like product recommendation, inventory management, customer service, etc., allowing retailers to provide 24/7 customer support (using a chatbot). Moreover, AI-powered cameras and sensors can improve security and provide useful insights into store layout.
Robotic Process Automation
RPA software is designed to automate repetitive tasks such as order processing, inventory management, etc. The technology can free your resources from tedious and time-consuming tasks. Thus, it saves time, improves accuracy, and enhances overall efficiency.
Additionally, it can reduce operating costs by digitalizing resource and time-intensive tasks, making them more efficient, faster, and accurate.
Internet of Things
IoT is a network of connected devices that helps retailers collect user data to understand customer behaviors and monitor store traffic.
Using the data gathered from these various devices, retailers gather important information related to customer preferences (what they do and don’t like), hours with maximum footfall, inventory monitoring, etc. This data is also used to personalize customer support and services.
Augmented Reality
Are you wondering how AR can assist in implementing automation in retail? Well, by helping the customers visualize things in their space.
Retailers, especially those in the furniture industry, can use this tool to create an immersive shopping experience. Customers can leverage AR and see for themselves how things/furniture will fit into their existing floorplan. They can also see all the related details, improving the shopping journey.
Blockchain
Last but not least is Blockchain, a technology that helps retailers reduce intermediaries, costs, and transparency in the system.
Blockchain’s advanced data management and supply chain management tools can significantly reduce risks and improve transparency. This further ensures that product quality and authenticity are maintained, which improves your reliability as a service provider.
Retail Automation Examples: Real-World Applications
Many big companies have already adopted automated retailing. They are automating customer services, optimizing business operations, and completely transforming their operations. These companies are revolutionizing the retail industry through their automated channels of operations.
These automation solutions aren’t just about taking the business online but optimizing the retail store functionality. Some examples of automated retail stores are:
Walmart’s Streamlined Checkout Process
Walmart designed an automated checkout system that provided real-time updates on checkout lane availability. This eliminated long queues, as customers could easily navigate to free lanes instead of waiting.
Additionally, the option of self-checkout or employee-aided checkout further reduced the dependency on the cashier. This allowed staff to host and interact with customers, adding to their overall experience.
Cashierless Shopping With Amazon
Amazon sits at the top of automated retail with its Amazon Go store. The fully automated store doesn’t have any cashiers and is powered by AI-based sensors and cameras that track customer activity.
Customers can scan the QR code or credit or debit card when checking in, grab what they need, and go. The bill is charged to their account or card when they leave, and there is no checkout queue.
Starbucks AI-Bot To Order Coffee On The Go
Starbucks understood the morning rush and designed an AI app (My Starbucks Barista) specifically for office workers who do not have time to wait in long queues.
The app accepts commands in both voice and text format. Once an order is placed on the go, it is ready for the customer to pick up at the nearest Starbucks outlet.
Zara’s Streamlined Order Pick-Up
We all are aware of the “buy online and pick up from store” option that many retail stores follow. However, the fashion retailer Zara introduced robots to streamline the pickup service further.
It operates by having the customer enter a pickup code that triggers the robot. The robot then starts looking for packages in the warehouse. Once found, it delivers the package to the customer via Dropbox.
Our Final Thoughts On Retail Automation
Automation in retail industry is not just a concept but a real solution that has actualized in many forms and shapes in various sectors of the industry. To navigate the current tech-savvy world, one must embrace change and implement the required upgrades.
Today, people prefer relevant, efficient services that require less than a few clicks to conclude. So, if you do not match the pace, stability, and business will be compromised. Regardless, while advancements are welcomed, their complexity requires not just expertise but also reliability.
For the retail industry, IT solutions are secondary business operations. Thus, outsourcing the services is the most cost-effective and practical solution. Partnering with the ideal service provider is the key to successful solutions that add value to the current operations.
And at OpenXcell, that’s precisely what you will get. Our team of industry experts works tirelessly to design the exact retail automation solutions that reflect your ideas and optimize your workflow as seamlessly as possible. So connect with our experts today and transform your retail business with the latest technology.