C-Store Advantage with New Shelf Label Tech

Many states have gotten serious about shelf label accuracy and Missouri Walgreens stores have a clear understanding of that now, as they have come to a costly agreement.  In 2013, the Missouri attorney general (AG) sued Walgreens after the state claimed that investigators found 43 out of 205 items purchased at various Walgreens stores to be mismarked. The price displayed on the shelf tag did not match the price at the point of sale.

Convenience stores have a significant advantage in dealing with this problem as they simply have fewer items that need prices to be maintained, updated and changed.  This makes electronic shelf labels (ESLs), not only the best solution, but an affordable alternative.  

A grocery store or drug store can have between 40,000 to 60,000 items on the shelves. A convenience store, on the other hand, will have between 2,800 and 3,500 items, making this solution affordable.  

In the Missouri case, the attorney general said the reasons for the inaccuracies include outdated price displays, different pricing on items in multiple locations throughout the store and clearance items not clearly tagged.  Unfortunately, that is no big surprise.  The system that many chain stores employ is to send the individual stores a price update for both the shelf tags and the point of sale system.

The manager updates the point of sale system or it is done automatically from the home office and prints or gives the shelf tags to diligent employees to change prices in between other duties.  When the timing does not match up, the shelf tags are deemed wrong.   

California, Missouri and Wisconsin have led the way by filing lawsuits against claimed transgressors costing retailers tens of thousands of dollars. The Missouri settlement, announced on June 7, 2014, requires Walgreens to pay for independent auditors selected with the approval of the AG’s Office for a period of three years. Stiff penalties will be assessed if shelf tag problems persist.  Each store must maintain a 98% accuracy level.

ESL's can easily combat this shelf tag problem and also give other significant benefits. They can allow POS and shelf tag prices to be adjusted from a central location, thus making all pricing more accurate.  Prices can be changed based upon market forces and updated as often as needed.  ESL's will eliminate printing for shelf tags as a business expense and they cut labor costs for hanging tags.  These savings give a quick return on investment. Just the savings on printing costs over time will create a return.

For more information on shelf tags and the investment required to put them in place at your store, contact us at info@pos-plus.com.