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Stock in Trade

By Gary Bolles  |  Posted 06-13-2002 Print

Stock in Trade

Even when it's built on an existing wired system that's functioning well, large-scale wireless rollouts can require near-military precision. Take Longs Drug Stores Corp. Each of the firm's nearly 450 retail locations throughout the western U.S. and Hawaii stock an average of more than 100,000 items each year, so lots of computer power is a necessity. And until recently, each store sent point-of-sale information over high-speed data lines to the company's central inventory database in Walnut Creek, Calif. Store managers kept on top of the dozens—and sometimes hundreds—of pricing changes, and stocked items by scanning every single item each week.

But that was the problem: The retail system was far from the store floor, and keeping up with changing prices meant filling up a shopping cart with every product sold, wheeling it into the back room, scanning them all, then returning them to the shelves. Then the system would print out problem lists, which employees had to go back and resolve in the aisles.

And what problems there were. Any change in pricing—manufacturer price increases, temporary price reductions, promotions in ad circulars, product recalls—required new labeling on the shelf, and sometimes even on the items themselves. Regular changes in stocking—holidays, changing seasons, and back-to-school promotions—meant a constant cycling of products on and off the shelves. "It's a very dynamic environment," says Carl Britto, Longs' director of store technology planning. "That's what's so exciting about retail."

Exciting, yes. But for a store manager, exhausting. The answer was the "mobile manager 1,000," a pushcart with a wireless laptop from Symbol Technologies Inc. built-in. Employees could simply wheel the cart to the shelf, scan products effortlessly, and transfer the stocking information automatically to the store's retail information system. Once the system was designed and tested, says Britto, Longs had all its locations up and running within seven months. "The rollout was one of the fastest we've ever done," says Britto.

He points to several critical steps that smoothed the process. The first was to develop a complete rollout plan "so you don't have to double back," says Britto, and repeat any steps that might have been missed. And Longs rolled out the application to be used by employees before it installed the wireless hardware, giving local managers time to learn the software.

As to the return on investment, Britto says a beta evaluation was initially conducted in five Longs stores. Analysts clocked the amount of time it took to perform a variety of tasks using the old bar-code system, then compared the same tasks once the wireless system was installed. Based on estimated reduced labor costs of at least 10 to 15 hours per week at each store, the wireless system was estimated to provide complete payback within 12 to 18 months. And Britto says the company is "pretty close" to being on track to delivering on that commitment.

Not everything went smoothly. Britto was pleased that Symbol and Cisco developed a partnership to integrate Symbol's mobile devices with Cisco's wireless networking just as Longs was installing its system, but he wasn't happy with the speed at which Cisco kept its promise to deliver enhanced security for the system. "The vendor needs to put its money where its mouth is," cautions Britto.

Still, Longs has ambitious plans for the system. The next step is to use smaller handheld devices that would allow store personnel to process customer returns and perform store audits quickly. The company is also experimenting with connecting store equipment not currently on the local network, such as photo lab processing and video rental machines. Some cash registers will be converted to wireless, allowing stores to hold sidewalk sales more easily.

Britto's satisfaction with the business value of the wireless network is clear. "We want to compete, so we have to do things faster, cheaper, and the technology has to roll out faster, cheaper," he says.


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