wiki supermarket service innovation combined_final
TRANSCRIPT
Supermarket Operation and Service
Innovation
Billy Leung Dickens Chow
Kevin Kan Marcus Yeung
Rachel Yu Ricky Au
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Agenda
Supermarket shopping Shoppers’ Survey Wish list The Wiki Model - What is it? - Process flow (purchase, payment and collection) - etc Challenges and Limitations What’s Next?
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Supermarket Shopping
Combination of grocery stores into a place Customers choose and buy from a variety of products
Current Process
Shop Select Collect Pay
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Findings on Shoppers’ Survey
Frustrated with queues at pay points 84%
Walk away from a store with long queues 74%
Frustrated by out of stock product 84%
Frustrated by change of store layouts 76%
Frustrated by too few staff on the shop floor 71%
Frustrated by unclean stores 77%
Source: Kronos Survey 20084
Wish List
Customer
• No queue at checkout• More customer oriented
services• Pleasant supermarket
shopping experience
Supermarket
• Cost reduction: rent, labor etc.
• Profit maximization: turnover, patronage etc.
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NO QUEUE GUARANTEE
Objectives
Shorten customers’ shopping time Serve more customers and increase sales volume Provide more convenience to customers in supermarket shopping Increase product varieties Provide add value services to customers during their supermarket
visits
How?
A trolley-free supermarket shopping environment, offering express checkout service with
The Wiki Model
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Stocking Process Shopping Process
Warehouse
Table 1 Supermarket Business: Inventory Flow Cycle
WarehouseSupermarket
(in-storewarehouse)
Up-shelf(supermarket)
Off-shelf(shoppers)
Cashier Checkout
Purchase Ready-to-go
Supermarket(in-store
warehouse)
Checkout Point/ Cashier
Purchase Ready-to-go
Automated inventory Categorization Systemto bag purchase orders
• long queue • slow checkout• time consuming• trolley jam for homedelivery orders
• labour intensive
Current Inventory Flow
Proposed Inventory FlowOctopus card purchase
Manually off-shelf to trolleys
• warehouse direct deliveryfor homedelivery order
Supermarket: Inventory Flow
Video: Journey of a supermarket trolley
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Process Work Flow
Customer selecting items • Octopus card
Customer pay & confirm the order
Moving items from shelves to collection areaOption 1: conveying belt
Option 2: moving basket
Ordered items shifted to collection
Collection• Display order
number on a board
• Verify order number
• Customer collect goods
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Ordering Device: Octopus Card
Select commodities on
screenWave card Confirmation
kiosk
Payment kiosk/Check out
counterPick up number
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Octopus card reader installed for each of the commodities OR touch screen reader for selection of item wave card
No charge, only record unique number of Octopus Card
Octopus Card: Pros & Cons
PROS CONS
Almost everyone has an Octopus card**95% penetration in Hong Kong**** >17 million cards in circulation**
Process for ordering same items for multiple quantities
Well established and stable Octopus card system
Not able to check list of shopped items handy but at confirmation kiosk
Minimal R&D and testing costs Potential queue at confirmation kiosk
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Payment
Confirmation slip at confirmation kiosk Conventional methods of payment i.e. Cash/EPS/Credit
cards/Octopus card
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Back-end logistic system starts moving the ordered items to the counter for collection
Option 1: Conveyor Belt Option 2: Moving basket
Customers confirm order at confirmation kiosk (POS terminal)
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Back-end Logistics
Option 1: Conveyor Belt
Main controller trigger the relay at the respective shelves Selected items drop to “Smart Container” at the
conveyor belt Items per order to be collected via “Smart Container” to
the basket at goods collection area
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Option 2: Moving Baskets
Goods drop to the same collecting basket on the conveyor belt
Baskets start from the beginning of the belt and go through the circle
Customers collect ordered goods at the end of the conveyor belt
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Conveyor Belt vs Moving Baskets
Conveyor Belt WINS!!
More efficient: shorter route Avoid stacking Avoid overloading Easier to monitor
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Display board showing order number ready for
collection
Customers collect items by presenting
confirmation slips
Collection
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How does it benefit to customer and supermarket?
More product varieties
Less trolley traffic & queues
Tracking of expiry dates
Consumers & Patronage More $$$
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Less rental space Less rental cost More $$$
Challenges and Limitations
Consumer Behavior Logistics
Cost Implication Environmental Friendliness
Changing “shopping
experience” Last-minute change Consumer adaptability Bulk purchase & home delivery?
Bottleneck at check -out point during peak hours: another queue?
Sophisticated automated back-end system
• BYOB vs Packaging
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What’s next
Get the idea patented Build a prototype Develop software and source hardware Write up a business plan Study other options – Smartphone and QR Code
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Our Ideal Plan
A
B
C
A = High-end supermarkets
B = Regular supermarkets
C = Market expansion
HK Market
Overseas Markets
Year
Growth
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Q&A
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Future Ordering Device: SmartPhone
Allow user to install and run advanced applications Customers install specified Apps Feature phone could do the same via WAP technology Current penetration rate of smartphone:
80% in US by 2012
48% in Hong Kong in Q4 of 2009, not yet a mature media for making orders
Huge potential growth with expected penetration rate of 80% in 3-5 years
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Future Ordering Device: SmartPhone
Open App Take picture
Select quantities
Confirm order
Payment via
internet
Pick up number
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Ordering Device: SmartPhone
PROS CONS
Unlimited possibility for system development
Low penetration rate of smartphone
Easy information push to customers Stability of App in question
Save queue time by payment online
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QR Code (Appendix)
Matrix code (or two-dimensional bar code) Storage of more information, more character types that
could be printed in a smaller space Capability in handling all types of data (e.g. numeric and
alphabetic characters, symbols, etc…Up to 7,089 characters can be encoded)
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