How DiscoveryIoT’s Asset Tracking Solution helps the Retail Industry
Valued in trillions, retail is one of the biggest industry sectors in terms of its market size. It was reported that the retail sales in the US grew to $3.53 trillion in 2017, whereas for the same year, China experienced a near eight per cent growth rate to hit $5.78 trillion. The combined retail market value of just these two countries amounts to $9.3 trillion so it would be reasonable to assume the global retail market size to be at least twice or thrice the size jointly represented by US and China. Although the retail industry is undoubtedly growing, the associated losses that retailers incur are also going higher. In 2015, it was estimated that retailers experienced a whopping $1.75 trillion in losses due to understocking, overstocking and returning of inventories. While there are no recent estimates of the number, it is probably safe to assume that it is around $2-3 trillion now. Besides, retailers also experience a common problem of retail shrinkage that is attributed to shoplifting, employee theft, frauds and administrative error. The Smart Supply Chain solution that DiscoveryIoT proposes, therefore, has the potential to address a trillion dollar problem that has been plaguing the retail industry. In essence, DiscoveryIoT is looking to provide an asset tracking and analytics solution by leveraging technologies such as the Internet of Things(IoT), the Blockchain and Artificial Intelligence (AI) to create a network. The network will comprise three layers, namely- an IoT tag called ‘Cliot’, a community of smartphone users and cloud analytics. Cliot will act as a passive GPS that is compatible with WiFi and Bluetooth communication protocols.
Moreover, it is being developed to contain multiple sensors capable of giving insights into parameters such as a product’s state and temperature. A smartphone community registered on the network forms DiscoveryIoT’s second layer. Cliot can pair up with these phones that are in its proximity, via private key authentication and transmit location or other relevant data to the phones. The data is processed in these phones and are stored in a blockchain based application that will render any hacking attempts futile. This data is then uploaded to the Cloud using the phone’s data network, where analytics tools will be employed to extract relevant insights into the Big Data, thus forming the third layer of the network.
Asset tracking allows retailers to get a clear stock on the inventories and to effectively manage them. In addition, it enables minimisation of the losses faced by them, whilst giving clarity to distributors and manufacturers on the market reception of the products for effectively planning production. Following are some of the benefits that the DiscoveryIoT’s tracking solution provides:
Preventing Understocking and Overstocking situations
Every retailer wants to strike the right balance between overstocking and understocking inventories. However, till date, finding that equilibrium is next to impossible. While out-of-stock results in lost sales, stock obsolescence or overstocking amounts to losing money. With DiscoveryIoT’s solution, products can be affixed with Cliot tags which will allow retailers to accurately assess stock of the inventories. Asset tracking essentially provides visibility into procurement to end sales which help in deciding when to replenish and when not to overstock.
Effective trade marketing
Trade marketing refers to the activities carried out at the retail stores to increase sales such as discounts or other attractive offers. When products are attached with a tracker, the data received from trackers can be analyzed with analytics tools to extract insights into how well the product is selling out. Based on the sell-out data, effective marketing tactics can be employed to drive more sales. For instance, with the analytics of product sell-out available, a brand operating multiple retail outlets can receive deep insights into the products that perform well in specific outlets. This information can be utilized to come up with effective marketing strategies and further give a boost to the sales.
Improved customer satisfaction and brand recognition
It is found that when customers experience stock outs, they are more likely to walk out of the store. This can leave customers frustrated and it will also cause them to be less loyal to brands. With DiscoveryIoT’s solution, as seen above, stock-outs can be prevented, thus augmenting the customer satisfaction. This, in turn, can result in customers spreading a positive feedback about the experience, which will ultimately amplify the brand recognition.
To conclude, as the retail industry continues its growth, retailers will continue to grapple with the problems of stock outs, stock obsolescence and retail shrinkage, unless a decisive step is taken to mitigate them. Much of the problems arise as a result of poor management of inventories. Thus, it is high time that the retail industry embraces technologies such as IoT and Blockchain for the solutions they have to offer.