RETAIL BUSINESS INTELLIGENCE ISSUE 3 / JUNE - AUGUST 2013
TECHNOLOGY IN RETAIL
Sailesh Savani, CEO/Founder of CompuLynx
FUTURE OF RETAIL PRIVATE LABEL TEAM BUILDING SELF CHECK-OUT QR CODES IN RETAIL
DELI EQUIPMENT FRYERS GRIDDLES TOASTERS PIE WARMER PRESSURE FRYER POPCORN MACHINES SHAWARMA MACHINES SHOWCASE ,DELIS & WARMERS
PIZZA ROLLER ROTARY OVENS DOUGH MOULDER CONVECTION OVENS DIVIDERS & SHEETERS CAKE & DOUGH MIXERS PASTRY COLD & HOT SHOWCASE
SLICERS BONE SAWS MEAT MIXERS COLD ROOMS MEAT MINCERS PATTY MACHINES SAUSAGE FILLERS DISPLAY CABINETS
Main mombasa Road Allbid house, Opp ASL, P.O. Box 49938, 00100. Nairobi. Tel: 020 2133076 / +254 - 727 246 209/+254 - 725 351 079 Email:email@example.com web: www.nkc.co.ke
PROJECT DIRECTOR’S NOTE
elcome to our third issue of Insight Retail Magazine, a quarterly publication whose aim is to offer the retail industry and other interested readers with insightful local and global news, trends and solutions on various industry topics.
This issue focuses on Automation in the Retail industry. The industry is facing sweeping and unprecedented change. Customers’ expectations growing higher, economic pressures require them to do more with less, and each day new competitors appear. Responding to that rapid pace of change is a retailer’s biggest challenge while at the same time an opportunity. Retailers who can adapt to change can make intelligent, fast decisions; find new markets to exploit; and constantly improve their products, services, and operations. But retailers do not have a switch to flip that turns them into super smart, super-adaptable businesses this hoping to find that switch, they often turn to technology, looking for some magic to help them navigate a changing business environment. Three key areas of retail business process innovation that can be transformed through business process automation are the; the point of service, supply chain management and multichannel integration. On the flip side, technology by itself is not the solution. Any discussion about generating a positive impact for the business should first center on how to empower people with effective solutions that deliver results. A “connected retailer” not only leverages a flexible, economical technology platform that drives results, but also focuses primarily on its greatest asset: people empowered by the right solutions to act on the right information at the right time. Considered as the only point of reference to all stakeholders in the retail industry, the Magazine will still be distributed for free to all retail outlets countrywide as well as other interested players via post. The soft copy of the magazine is also available through email for registered stakeholders as well as on our website http://www.insightretails.com/magazines. Finally, we thank the readers and the general retail industry stakeholders for your continued support. Keep Reading!
Titus Korir Project Director
Special Projects Editor Strategic Associates Contributors Various Publisher Insight Retail East Africa © 2013 Insight Retail All material is strictly copyright and all rights were reserved. Reproduction in whole or in part without the written permission of Insight Retail is strictly forbidden. The greatest care has been taken to ensure the accuracy of information in this magazine at the time of going to press, but we accept no responsibility for omissions or errors.The views expressed in the magazine are not necessarily those of Insight Retail or Retail Interchange Centre. Retail Interchange Centre Limited P.O. Box 36106 City Square 00200 Nairobi, Kenya +254 725 350 690 +254 735 350 690 email: firstname.lastname@example.org www. insightretails.com
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CONTENTS INSIGHT RETAIL | ISSUE 03 JUNE - AUGUST 2013
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THE FUTURE OF RETAIL STORE ASSISTANT INVENTORY MANAGEMENT SYSTEM ALIGNING TO CUSTOMER NEEDS TEAM BUILDING MOBILE RETAIL REAL-TIME SECURITY INFORMATION SELF-CHECKOUT TECHNOLOGY ADVANCES IN RETAIL
15 18 20 22 23 24 25 26
RETAIL GLOBAL TRENDS RETAIL BARCODES PRIVATE LABEL WHERE QUALITY SERVICE IS KEY KHETIA’S AWARDS SHOPPERS IN STYLE RETRAK TO ROLL OUT MASSIVE RECRUITMENT CAMPAIGN QR CODES IN RETAIL
RETAIL ECONOMIC SURVEY
THE FUTURE OF RETAIL
Global Powers of Retailing 2013
he retail industry is in the midst of a customer revolution. The collision of the virtual and physical worlds is fundamentally changing consumers’ purchasing behaviors. Consumers are seeking an integrated shopping experience across all channels, and expect retailers to deliver this experience. Failure to deliver puts retailers at risk of becoming irrelevant. The key drivers of this customer revolution are the rapid adoption of mobile devices, digital media and tablets equipped with shopping apps. Traditional retailers must find opportunities to seamlessly embed the virtual world into their retail strategy by developing in-store and online technologies that allow them to create and maintain meaningful and sincere connections with customers across all channels. THE ARRIVAL OF THE FUTURE The retail paradigm has shifted from a single physical connection point with customers to a multi-pronged approach that crosses both physical and digital channels. The traditional bricks-and-mortar retail store is no longer the dominant medium for purchasing goods. Instead, it serves as one of many potential connection points between customers and a retailer’s brand. However, many retailers are struggling to take advantage of the increasing number of channels available to them for connecting with customers. Further, they are neglecting to make appropriate investments in technology, operations and talent that would better equip them for seizing control of these channels. Retailers’ technology can be disparate and fragmented, and multiple physical locations can drive an unsustainable cost structure that is not flexible and often underperforms. Additionally, employees often lack the knowledge, training and tools necessary to facilitate a shopping experience that engages customers across a variety of channels and extends beyond the traditional shopping experience. As a result, many retailers are falling behind in the race to offer a unique and comprehensive experience with their brand that keeps pace with customers’ ever-evolving attitudes and expectations. Retailers are faced with the challenge of engaging customers on more than just price. They must make shopping across all channels a more
stimulating and satisfying experience, rather than simply a way to find the lowest price for a particular product. On the other hand, new competitors are disrupting the market and capturing valuable market share through innovative business models. Many companies are now seeking to become vertically integrated by controlling the whole supply chain. As a result of a vertically integrated value chain, a new generation of e-commerce players is bringing high-quality products from the warehouse directly to consumers at significantly lower prices. Hence, retailers must respond to new competition by enabling digital experiences that improve both
Business experts believe that one of the ways that entrepreneurs can raise to the occasion is by investing in various information technology solutions which could help them reduce some of the high operational costs as well as giving them a competitive edge. the store and virtual experience for the customer. Equally important, they must find a path to success that not only addresses the needs of their customers today but is also flexible enough to continually evolve with customer interests and expectations. The customer revolution and the future of retail have arrived. Retailers must respond now or risk facing obsolescence. PATH TO RELEVANCE Today’s consumer is increasingly connected to both the physical and digital space and able to interact with retailers through multiple channels simultaneously. To stay competitive in this everevolving landscape, it is imperative for retailers to deliver a seamless customer experience across all channels and provide the right services and products at the right time. Specifically, retailers must develop an integrated strategy that aligns talent, physical space, processes, marketing and merchandising to meet consumer demands. This strategy should be supported by emerging technologies and continually adapted to remain relevant to the customer of tomorrow.
A robust retail strategy must include: • A strong vision of the experience the customer desires across all channels • A nimble operating model that can adapt as the retail environment changes • A deep understanding of how to support the vision through inventive digital solutions and retail technologies, such as playbooks to operationalize the omni-channel strategy. KEY ECONOMIC DRIVER Kenya’s wholesale and retail sector has continued to experience renewed economic performance optimism. The National Economic Survey 2013 places the sector as the second most important economic driver after posting a growth rate of 6.4 percent as at the end of 2012. Describing the sector’s growth as notable, Anne Waiguru, Cabinet Secretary for Planning and Devolution while releasing figures of the Economic Survey 2013 noted that the overall national economic performance had been supported by a stable macroeconomic environment, increased domestic demand and modest growth in credit. Despite the performance, Atul Shah, Nakumatt Holdings Managing Director calls for policy level recognition of the retail sector. Players in the industry lament at the government’s slow pace in formulating a Retail Development Policy to help guide the sector’s growth at the national and county level. Additional information: www.deloitte.com/consumerbusiness
Store Assistant Inventory Management System
ne of the major challenges that retailers are facing today is how to control and manage their inventory. This is a big problem as there have been no solutions to assist the retailers perform stock takes and its related activities in an easy and timely way. After an extensive market research, Vortex Solutions has developed a Store Assistant Inventory Management System that uses barcode enabled terminal device and a software suite that makes managing stocks and related activities in the stores effective and easy. The software is able to do the following: 1. CARRY OUT STOCK TAKE Store attendants will use the terminal to scan items and enter quantities available. The entries will be saved and either, verified first before they are updated to the ERP system alternatively the system can be configured to automatically update the ERP system with the quantities captured. 2. PERFORM STOCK REORDER Items reordering will be done easily by simply scanning and imputing the quantities to be re ordered. The reorder list will then be verified and then posted into the ERP system as a Purchase Order.
the price on the shelve and the pricing on the ERP system are compared, if there is a discrepancy the entry is logged into the system for later verification and updating ,so that the pricing on the shelves and the ERP pricing are the same.
3. PERFORM PRICE CHANGE VERIFICATION Sometimes the prices that are being pushed to the shelves are not updated, it is important to ensure that the pricing indicated at the shelves and the prices in the ERP system are the same. To verify this, the terminal is used to scan the item at the shelve, and
Vortex Solutions also offers an array of solutions for the retailer. The company offers an End to End fully integrated comprehensive Retail Information Management System that includes a Point of Sale, an Inventory, Customer Loyalty System, Promotions Management Kit, Voucher System, HR and Payroll and Financial and Accounting.
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Aligning to customer needs DINESH JAIN, CEO, Insync Solutions Limited
few years ago, the development and penetration of information technology (IT) among businesses was very minimal. Then, while automation among businesses in the developed world was reported to be transforming how operations are run, back home, businesses were still hooked up into what currently could be deemed as ‘traditional’. Today, thanks to automation of business processes, large and small local companies are now able to realize results effectively and efficiently. Insync Solutions Limited ensures that businesses achieve optimum results through automation and understanding its customers’ needs. For management of retail businesses, the company’s complete barcode point of sale (POS) solution enables the retailer to manage its suppliers, own operations, and its customers. “Using Insync POS users can stay current with the changing information of the outlet/store,” Dinesh Jain, the company’s chief executive officer explains. The POS is sold either as front-office and backoffice module. The front-office provides a complete retail solution that can be run as a stand-alone application in individual stores, as well as connected to the head office using Insync POS Back-Office. The back-office module equips retail chains or multi-store businesses to roll up and manage data for all stores from the head office. It can be further configured as a restaurant mode for use in restaurants, coffee shops, cafe and bars or used in supermarkets, warehouse and any other retail/ wholesale shops. In terms of managing employees, Mr. Jain explains that the company offers an integrated human Resource, payroll system and Biometric based time and attendance. The company is home to client/ server solutions on a wide range of HR functional areas through its iPayroll brand. He further notes that businessmen have become aware of how important it is to invest in an ERP solution able to integrate internal and external management information across an entire organization. “Our specialty is Retail & Accounting systems for small & medium companies and our popular web based Accounting system is a simple, but powerful system,” Mr. Jain notes. Among the
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areas it covers include purchase orders, goods receivable notes, supplier invoices/credit notes, payments as well items and inventory. Globally, retailers are engaging with their customers through their various customer loyalty programs, meant to keep the customer “locked” to a particular retailer by way of repeat and more frequent purchases and higher spend with the retailer. Insyc’s Loyalty Points Management system allows retailers to create their own points-based incentives, promotions and loyalty system to reward their visitors, customers and members for purchases, engaging in feedback, taking tests, and much more. Insync has formed a strategic business partnership with IDS Softwares Pvt. Limited, a global leader providing integrated IT solutions for the hospitality industry. Headquartered in Bangalore, the company has been very successfully, designing, developing, marketing and maintaining a comprehensive range of information management systems and end-toend hospitality solutions for large and mid-sized businesses that includes independent and chain of hotels, resorts and clubs, restaurants and cafes, bed and breakfast and serviced apartments. “We perceive technology with high spirit. Technology in mind and the enthusiasm in heart is what we mean, supported by state of the art infrastructure and highly skilled technical professionals,” adding that the company offers end to end solutions for hardware, software, security (CCTV), biometric access control and much more, hence giving the customer an opportunity to get all solutions at one stop including products in promotions,” says Mr. Jain.
He notes that Insyc’s software development tools and products implement object-oriented design and programming. This is further enhanced by the use of modern development tools and technologies available in the market today as the company seeks to stay on pace with the fast evolving software development capabilities. The company not only provides software for the retail and accounting industries but also utilizes its expertise for independent projects and special contracts. For those looking to start a daunting project and would like technical assistance or support, consider hiring Insync Solutions to help manage the project. “We generally stock most of the products relating to our business including accessories and spare parts for same,” Mr. Jain notes. Currently all the company’s operations are handled by its Nairobi office, apart from reseller’s across the region.
Our specialty is Retail & Accounting systems for small & medium companies and our popular web based Accounting system is a simple, but powerful system. OFFICE RE-LOCATION Insync solution ltd has moved from 3rd flr Sound plaza to Reliable Tower, 11th Mogotio Rd,6th floor,6A wing within the westlands business hub. T.+254.731.222 999 /+254.735.222 555 email@example.com www.islkenya.com
Its importance in the workplace
n every workplace, people talk about building the team, working as a team, and my team, but few understand how to create the experience of team work or how to develop an effective team. Belonging to a team, in the broadest sense, is a result of feeling part of something larger than yourself. It has a lot to do with your understanding of the mission or objectives of your organization. At the same time, team building is one of those ambiguous subjects that people end up describing it differently. To some it refers to those activities rolled out by organizations, these include drama, dressing up and acting out scenarios from work-life, games, sporting competitions, war game amongst others all in an attempt to get people working together effectively. While these explanations could pass as valid, team building is a continuous process that helps gel a group of distinct and separate individuals into the process from a group to a team, working for common goals, and defending common values. For the success of any organization, the ability to work together as a team is integral we believe that people learn best when they can “do” and not just hear information. This is what is referred to as the interactive approach to team developmentExperiential Learning IMPORTANCE OF TEAM BUILDING a) Team building enhances values that an organization needs to function effectively, as a team. These get created, shared and signed-up for by everyone. If an employer wishes for employees to work together, while fighting for a common cause and care for each other, they need strong values, built, upheld and recognized by the team and not imposed from outside. b) Team building helps in organizational transformations; when team members
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communicate clearly, understand one another and cultivate trust by working together to creatively solve problems. Each challenge provides the opportunity to discuss applications at a personal and professional level, providing each individual firsthand experience enabling them see how they can utilize their strengths to help them go further. Most successful team building events are clearly linked with professional and personal development efforts undertaken both in the organization and by the team members. If there is no link there could be a chance that the team building event is viewed as just a jolly day out. c) Effective team building strikes a good balance between the delicate issues of results versus relationships. Result driven organizations tend to sideline the importance of good working relationships, a recipe for a conducive working environment for greater innovations, healthy competition, open door policies et al which actually increase the productivity of the members. On the other hand, a largely pro relationships approach at the expense of results can have far reaching implications on the organizational health. Laxed attitudes at work make people not feel the need to meet their targets because their boss is “laid back”, if you will and since he/she values those relationships they are not as stern or firm as should be. d) Team building also brings about greater selfawareness and a realization of the strengths, assets and weaknesses of others in the team forming a strongly motivated cohesive unit that shares and learns values that help the team, individuals and the organization move forward together. Fun and games are not always able to guarantee any of this. Team building in essence, cannot necessarily be bought out of a catalogue but the effectiveness is always going to be questionable.
e) Great organizations know that leadership skills must be developed within each employee. ‘Lead Better’ is an experiential leadership program that teaches the SERVE model of leadership. Strong leaders exhibit both skills and character. The SERVE model develops both as a team learns to: See and Shape the Future, Engage and Develop Others, Reinvent Continuously, Value Results and Relationships, and Embody the Values. BlueSky Adventures guarantees positive and tangible outcomes for any organization at any and all levels that goes through our programs. Our motto is “Have fun, play safe & experience change”. Welcome to BlueSky Adventures…changing the face of Team Building!
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BlueSkyKenya.org Admin@BlueSkyKenya.org t. 020.230.9855 6th Floor, Lulu Center, Diamond Plaza, Parklands
How convenience scores higher than price in mobile retail
hile most retailers are aware that mobile web use and purchasing is growing, it is important for them to realize that to succeed in online retailing today, merchants must enable shoppers to buy easily with a mobile device.
Retailers need to realize that if one does not have his web site tuned for mobile devices, he is missing major sales opportunities. Today, consumers are not only using these devices to get information whenever and wherever they want, but also but also to buy. Consumers are using these mobile devices to access online retailers more than ever before. Statistics indicate that the amount of time consumers spent on retail sites via their smartphones has grown 385 percent over the past three years. This is compared to 17 percent growth over the same time period for visits to retail sites via computers. And 48 percent of total time spent on retail sites come from smartphone and tablet users. At the same time, not only are shoppers visiting retail sites via these devices they are buying from them as well. Mobile commerce grew 31 percent year over year in Q1 2013 to reach $5.9 billion. E-commerce meanwhile grew about 13 percent and total retail grew 1 percent. Perhaps surprisingly, consumers are buying more via smartphones than they are tablets. In Q1 consumers spent $139 on average via smartphones and $91 buying goods and services via tablets. As retailers continue to up their investments in mobile, they need to be prepared for consumers who increasingly expect to do more than price check via their smartphones and tablets. Convenience, the big factor Although the threat of show rooming is causing some retailers to significantly alter their pricing strategies, convenience is also a big factor in why consumers shop from their handsets. Nowadays, retailers are challenged to target two different types of mobile shoppers that each characterized by different behaviors.
Convenience is all about creating a one-on-one relationship with shoppers, and the more personalized and contextual that a mobile experience is, the more likely a consumer is to come back to a mobile site or app to shop again. Additionally, a convenient mobile experience means that the shopping experience is consistent across all screens. As retailers begin to move forward to second-generation mobile strategies, contextually-relevant features will play a critical role in how consumers use their smartphones and tablets to research, price check and shop.
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To keep experiences consistent and convenient, some retailers are embracing omni-channel marketing, which is aimed at creating similar experiences across all marketing channels. The concept of integrated shopping experiences between online, bricks-andmortar and mobile is so far being seen as the best approach for retailers.
DIFFERENTIATED In addition, retailers need to understand their consumers when it comes to picking between convenience and price to build their mobile strategies around even though price is often a subset of convenience.
Statistics indicate that the amount of time consumers spent on retail sites via their smartphones has grown 385 percent over the past three years.
Nowadays, consumers are buying everything from their mobile devices. At the same time, consumers’ expectations about their mobile experiences are also increasing. Therefore, retailers need to align their mobile strategies to focus on more than price differentiation.
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Targeted deals based on a consumer’s past buying behavior, mobile alerts and in-store mapping are all examples of features that retailers can tie into their mobile Web sites and apps to take the user experience to the next level.
Each retailer’s audience is often unique when it comes to mobile thus measuring their customers’ experiences on mobile – and how that may impact behaviors in other channels – retailers can better serve their customers and prioritize changes that improve financial performance.
Although mobile holds a promise to retailers for more differentiated shopping experiences, not all retailers are getting it right. For example, research from ForeSee, a company which is into customer experience analytics has found that task-completion rates on mobile average around 70 percent. This means that the average mobile shopper is only completing what they set out to do on a mobile site or app 70 percent of the time. “It is important that retailers measure the impact of their online and mobile experiences, so they can maximize satisfaction and engender brand loyalty,” suggests ForeSee.
Providing real time security information
ecurity has become a major concern among Kenyans. Even as various government agencies have put in place measures to tackle the spate of thefts, carjacking, robberies and other forms of insecurity that have plagued the country, the private security industry has had to come in to supplement efforts already put in place to curb the insecurity menace.
The positive feedback received from its clients has further seen the company go an extra mile and launch an interactive social media platform where security incidents are reported as they happen. This investment has resulted to Securex being considered as the leading security company when it comes to the use of social media.
Securex Agencies Kenya Limited is one of the companies that have come in to reduce the high insecurity levels that the country is witnessing. Securex, popular for its role in the provision of security solutions for some of the largest shopping malls and corporate organizations has further gone beyond the provision of general security services. According to Tony Sahni, Securex Managing Director, prevention of crime starts from making people more aware of what is happening around them. “Once someone knows the areas to avoid and have become more conscious of the new tricks being employed by criminals including crime trends, it becomes easier for him to plan accordingly and hence be safer,” he explains.
Mr. Sahni notes that the private security industry, best preferred for offering guard and cash in transit services, security gadgets such as metal detectors and closed-circuit television need to consider embracing and investing in modern technology with an aim of providing value added services to clients.
Mr. Sahni adds that they have studied various needs of their existing and potential clients noticing that customers are in need of real time security information. It is against this background that the company rolled out a value addition security information service that gives all its clients email security briefings every morning. The briefings contain incidents that have taken place within Nairobi. “This has been made possible since the company is composed of a workforce of almost 4000 employees in Kenya and a state of the art communications center located at the company’s headquarters along Parklands Road thus able to receive massive amount of data with regards to security,” he says.
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He also encourages clients to share the information with family and friends in a bid to ensure that more Kenyans are safe.
The company go an extra mile and launch an interactive social media platform where security incidents are reported as they happen. This investment has resulted to Securex being considered as the leading security company when it comes to the use of social media
etailers and consumers continue to embrace self-checkout – the technology that enables shoppers to scan, pack and pay for goods themselves. Even though the concept is yet to set foot in Kenya, self-checkout; first introduced in the UK in the 1990s, provide shoppers of all ages with an opportunity to feel comfortable with the technology, which they use to purchase goods ranging from food and clothes to pet supplies and electronics.
Terminals popular with both retailers and customers
Where self-checkout is widely used, shoppers perceive these terminals to offer faster service and create shorter queues – important service priorities in view of the increasingly busy lifestyles and congested towns and cities. Other shoppers cite privacy as a reason for using the technology. Research reveals a clear trend amongst consumers on a global basis towards top-up shopping. For instance, in Britain, the average shopper passes a supermarket at least once during a typical day and shops for groceries three or more times a week. “Shoppers are buying more fresh food as they would like to avoid waste. They want to be able to ‘grab, pay and go’ and many feel that checking out the goods themselves is the best means of doing this,” the research further indicates.
DEMAND For retailers, there are compelling business reasons for deploying self-checkout terminals. For instance, they more than double the number of tills that can be made available within the same space as an assisted-service checkout. The terminals also enable retailers to operate more cost-effectively meaning that one attendant typically oversees four or more terminals while other employees can be redeployed to improve customer service elsewhere in the store. There is also increasing demand for terminals which offer shoppers a choice of two or more languages – especially from retailers in areas that are popular with tourists or have high concentrations of immigrants. Some terminals can be equipped to ‘speak’ many different languages. Languages currently deployed on them include Danish, Dutch, English, U.S. English, Finnish and French. Others are Canadian French, German, Italian, Japanese, Korean, Lithuanian, Polish, Spanish, Swedish, Turkish and Welsh. It is for these reasons that self-checkout terminals are spreading to more countries. Additionally, those retailers which have already deployed self-checkout terminals are making an increasing number of them available in each store.
JOBLESS The self-checkout concept has its supporters and detractors. Convenience is the reason more and more retailers are using them. Some industry analysts believe that the terminals reduce labor costs and improve customer service for quick shopping trips even though can backfire when the technology does not live up to the claim. Another school of thought believes that thanks
to increased investment in automation thereby accelerating growth in the retail sector, the same could hamper efforts aimed at bringing down the global unemployment rate. Self-checkout machines take jobs away from able-bodied workers. Whenever the terminals are introduced to a store, retail clerks subsequently get replaced by the machines. As the wholesale and retail sector continues to become as important to Kenya’s economy, this can only negatively affect our country. Other risks they pose to the public, is access to liquor and other alcoholic beverages by minors since they are able to purchase alcohol through self-checkout machines without showing identification most of the time. In stores with these machines, it has been noted that minors use the lax supervision of self-checkout registers to steal alcohol or scan a 6-pack of soda and put beer in the bag. Despite these reservations, the self-checkout seems destined to grow. While theft may be a reason to eliminate self-checkout, most retailers see cost savings outweighing the losses. And while it seems ironic to use staff at a self-checkout, deterring theft and providing customer service to those who have problems with the technology is a big reason to do it. The ideal solution seems to lie in a compromise of using both staffed “human” checkouts and the self-checkout, giving customers a choice as there will be shoppers who prefer the convenience and speed of self-checkout and those who like the human interaction and customer service that a human cashier can provide. Chains which base their success on customer service might do well to retain the staffed checkout idea, elevating skillsets of the register people to create engaging last-minute experiences with their shoppers, making the shopping trip more personal.
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Technology Advances in
The last two decades have seen a quantum leap in the use of technology by retailers in all aspects of their operations. By Sailesh Savani, CEO/Founder of CompuLynx Limited
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am rushing to the supermarket before it closes,” Many are the times this phrase was used by many a shopper in the early 90s. Before the year 1995, supermarkets in Kenya would close for the day’s business by 6pm and 2pm during weekdays (including Saturday) and Sundays respectively. Today, the above timings will easily pass as outrageous or reverting to such hours of operations is close to impossible and would even culminate to shoppers taking to the streets to demand for the flexible convenient shopping hours that many continue to enjoy. Then, leading retailer Nakumatt became the pioneer in revising its opening and extending the closing hours. The retailer’s opening hours shifted to 8:30am from 9 am while closing at 8:30pm. Currently, retailers have further embraced the 24-hour concept giving shoppers the convenience to shop at whatever time. Revising the operating hours was just the beginning of the ever increasing demands on the entire local retail value chain-from the consumer to the retailer as well as the retailers’ service providers and the suppliers indicating that the market has gradually transformed from “seller is king” to “buyer is king”. All this could and will still not be achieved without retailers embracing technology. The last two decades have witnessed a quantum leap in how technology usage among retailers in all their aspects of the business leading to a transformed sector. This includes core retail functions such as inventory management and customer service to non-core retail functions like traffic or footfall monitoring and in-store security.
CUSTOMER FACING SYSTEMS: When we entered the retail technology space in the early 90s, there was hardly any technology being used in customer facing systems by retailers in the true sense of the word. There were diverse machines; mainly manually operated being used by different retailers ranging from manual adding machines, to mechanical cash registers and electronic cash registers (ECRs). At the POS after purchase, a customer would get a thin slip of adding machine roll with a line of numbers then, in comparison to today the same would make no sense to the customer. Even with the relatively less “intelligent” machines, it is amazing how the cashiers were smart by cramming the products’ prices especially of the fast moving ones. Needless to say, in those days, the memory faculty of a cashier was better challenged and utilized. At the same time, some of the products, particularly the imported ones, bore an inherent barcode which, with our limited knowledge at that time, represented the price of the product from the origin country. ELECTRONIC POINT OF SALE (EPOS) REPLACES ECR: This was a major milestone for retail in embracing technology at the POS. The shift brought about complimentary changes on the shop floor. Here, the traditional price tags printed from “price guns” were replaced with computer printed labels comprised of a product code, product description and, optionally,
a product price. Still, we were a couple of years away from producing our own barcodes.
BARCODING: The next major milestone was for retailers to start producing in-house barcodes for products that did not bear any barcode and adapt the inherent international barcodes (EAN codes) on imported items to identify products at the point of sale. The barcodes would reference the product in terms of data; product name and price. CUSTOMER LOYALTY: As the POS had fast transformed, the country’s retailers chose not to celebrate and relax on the above milestones as they continued to respond to the ever increasing demands of a more knowledgeable and informed customer thanks to his wide exposure through his travelling experiences. As the TESCO’s and the Sainsbury’s of the world were evolving their customer retention strategy by way of customer loyalty programs, Kenyan retailers too started introducing and launching their loyalty programs as a way of attracting and locking in more patronage while at the same time increasing revenues. Some retailers also saw the real benefit of a loyalty program in form of the highly valuable customer data. INTEGRATION WITH 3RD PARTIES: Soon the very demanding Kenyan retail customer started demanding more from the retailers in terms of non-traditional retail services like payment of utility bills. This posed a new challenge to retailers to integrate their customer facing systems with 3rd parties in order to make retail sale and provision of non-traditional services a seamless customer experience. POS systems soon started talking to various external systems including debit and credit card acquiring systems (for processing of card payments as a single pass transaction), utility service providers (for payment of water, electricity and telephone bills), Mobile Network Operators (for dispensing of Electronic Airtime as compared to sale of scratch cards), to mention but a few.
market has gradually transformed from “seller is king” to “buyer is king” RETAIL SHRINK CONTROL: The retail theft dilemma in Kenya is no different than any other part of the world. Retailers are faced with this menace thanks to the enemy within and without. Retail theft by employees and customers alike is as much a big problem for Kenyan retailers as it is for their global counter parts. Kenyan retailers soon followed the global trend of installing Electronic Article Surveillance (EAS) Systems to control retail theft by tagging most theft prone items with EAS tags. Although this has not helped in completely eliminating this challenge, it has certainly reduced retail theft and continues to act as a big deterrent.
TOUCH POS TERMINALS: Globally, retail POS terminals are becoming touch screen enabled to remove the clutter of multiple peripherals and cables from the POS counter as well as make the service at the POS more hands-free, quick and least interfering. In line with global trends, Kenyan retailers have started converting their POS terminals to touch ones too. This has challenged local software providers to scale up their POS software. Touch POS terminals are beginning to emerge at POS counters in some retail outlets and others will soon join the band wagon. GLOBAL TRENDS: Moving forward, there is a lot of proven global retail technology that Kenyan retailers can quickly adapt to as they seek to make their businesses more profitable, achieve better visibility of inventory and improve the customer experience. Some of these technologies include Source EAS Tagging, People Counting & Traffic Monitoring, Near Field Communication and Radio Frequency Identification (RFID & NFC), Customer Self Check Out, Predictive Data Modelling and Analysis as well as Electronic Shelf Labelling. In the near future, the next big thing that Kenyan retailers should start thinking about is omni-channel retailing where the customers will interact and transact with retailers across multiple channels; the brick and mortar store, web stores, online catalogues, mobile commerce, the customer care centre to social media. Across all these channels, the customer should expect a seamless and consistent experience however, preparing for an omnichannel presence will require a heavy investment of both time, and money. Communications between the IT department, marketing department, and sales staff will need to be as smooth as possible with little confusion about goals and strategies. A clear and thorough understanding of the customer, or target market, is required to be able to make appropriate decisions about channel integration and usability. Needless to say, technology would be a big component of this seamless customer experience. For more info, contact: e: firstname.lastname@example.org
INSIGHT RETAIL | ISSUE 03
RETAIL GLOBAL TRENDS
Consumers who rely on digital platforms to help with purchase decisions are also the shoppers most likely to use their mobile devices to do so
ccording to a study by GroupM Next dubbed “The Digital Consumer Journey” there are motivating behaviors behind six types of digital shoppers – the basic digital consumer, the digitally-driven shopper, the calculated shopper, the retail scout consumer, the brand scout shopper and the eternal shopper. The study also examines how Amazon is playing a role in show rooming and price comparison. “Of the six segments of digital shoppers identified in the study, the one which was the most mobile was the digitally-driven segment,” reveals the study. These shoppers use every tool in the digital toolbox and were the most likely to use their mobile device in the purchase process. GroupM notes that the people in this segment value convenience above all else, including brand loyalty. They will take their business to whichever brand the smoothest, most convenient shopping experience has. In the survey, their top motivations for shopping digitally were to avoid salespeople and crowds. They want to control the shopping experience, and any company that has a smooth, safe and convenient mobile strategy will earn their business. Basic digital consumers represented 29 percent of the study’s sample. These consumers rely on search and retail and brand Web sites to aid in the shopping experience and do not consider mobile as a primary digital tool. The most mobile-heavy group – the digitally-driven group – represents 16 percent of the study’s sample group of consumers. These consumers are early adopters of technology, most likely to find digital advertising as valuable and shop online primarily for convenience. Calculated shoppers, who also consider mobile as a primary tool for shopping, represent 11 percent of the study’s sample. Compared to the digitally-driven consumers, these shoppers are most concerned with the most information available to them and also tend to be show roomers.
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The retail scout group also relies on mobile, but primarily uses their handsets at home. Retail scouts represent 22 percent of the consumers surveyed. There is also a group of shoppers that are grouped into a category called brand scouts. These consumers rely on search and a brand’s site to help in their shopping experience, are brand-loyal and are swayed by perks such as free shipping. Forty-eight percent of all of the purchase decisions were heavily influenced by digital media and advertising, pointing to the increasing need for marketers to tie mobile and digital into all aspects of marketing campaigns. Increasing steps Pointing to the use of mobile as an aid in the shopping experience, the average digitally-driven consumer took five steps in the path to purchase. Compared to some of the other types of consumers, the digitallydriven consumer is taking fewer steps into consideration when shopping. For instance, calculated shoppers took 14 steps in the path to purchase, likely from checking prices across multiple marketing mediums. Even further, the study’s group of eternal shoppers took 35 steps in buying a product. These consumers are primarily in research mode and are not looking for price or promotions yet. Generally, the mobile users are used to getting the best deal. “Some shoppers may take the price of a product they want to buy at face value, mobile shoppers are highly likely to try and find a better price or a coupon,” indicates the study. Three of the six segments in the study had significant mobile usage, and those three segments were some of most motivated by finding the best deal. The mobile-heavy digitally-driven group in the study was also most likely to use social media to influence their purchases. Twenty-nine percent of the group said that social played a role in their purchase pathways.
customer loyalty programs, Kenyan retailers too started introducing and launching their loyalty programs as a way of attracting and locking in more patronage while at the same time increasing revenues. Some retailers also saw the real benefit of a loyalty program in form of the highly valuable customer data.
Additionally, roughly 14 percent of the group visits a branded social site after buying something online. The digitally-driven group’s reliance on social media is significantly higher than the overall role of social across all six groups observed. According to the report, branded Facebook and Twitter pages only appear in 4 percent of purchase paths. THE AMAZON EFFECT Amazon is an online retailer of books, movies, music and games along with electronics, toys, apparel, sports, tools, groceries and general home and garden items. According to the report, Amazon is included in 17 percent of digital pathways leading to a purchase. Every other retailer site made up a combined 34 percent of traffic. This means that one out of every three consumers that visit a retailer’s site go to Amazon.
agencies including Maxus, MEC, MediaCom, Mindshare, as well as Catalyst Online and Xaxis. guns” were replaced with computer printed labels comprised of a product code, product description and, optionally, a product price. Still, we were a couple of years away from producing our own barcodes. Barcoding: The next major milestone was for retailers to start producing in-house barcodes for products that did not bear any barcode and adapt the inherent international barcodes (EAN codes) on imported items to identify products at the point of sale. The barcodes would reference the product in terms of data; product name and price.
Forty-eight percent of all of the purchase decisions were heavily influenced by digital media and advertising, pointing to the increasing need for marketers to tie mobile and digital into all aspects of marketing campaigns. As mobile continues to be used primarily for price comparison – much of which is likely taking place on Amazon – simplicity will be key to retailers’ mobile initiatives going forward. GroupM Next is the new, forward-looking, innovation unit of GroupM, the world’s largest global media investment management operation that serves as the parent company to WPP media
Customer Loyalty: As the POS had fast transformed, the country’s retailers chose not to celebrate and relax on the above milestones as they continued to respond to the ever increasing demands of a more knowledgeable and informed customer thanks to his wide exposure through his travelling experiences. As the TESCO’s and the Sainsbury’s of the world were evolving their customer retention strategy by way of
Integration with 3rd Parties: Soon the very demanding Kenyan retail customer started demanding more from the retailers in terms of non-traditional retail services like payment of utility bills. This posed a new challenge to retailers to integrate their customer facing systems with 3rd parties in order to make retail sale and provision of non-traditional services a seamless customer experience. POS systems soon started talking to various external systems including debit and credit card acquiring systems (for processing of card payments as a single pass transaction), utility service providers (for payment of water, electricity and telephone bills), Mobile Network Operators (for dispensing of Electronic Airtime as compared to sale of scratch cards), to mention but a few. Retail Shrink Control: The retail theft dilemma in Kenya is no different than any other part of the world. Retailers are faced with this menace thanks to the enemy within and without. Retail theft by employees and customers alike is as much a big problem for Kenyan retailers as it is for their global counter parts. Kenyan retailers soon followed the global trend of installing Electronic Article Surveillance (EAS) Systems to control retail theft by tagging most theft prone items with EAS tags. Although this has not helped in completely eliminating this challenge, it has certainly reduced retail theft and continues to act as a big deterrent. Touch POS Terminals: Globally, retail POS terminals are becoming touch screen enabled to remove the clutter of multiple peripherals and cables from the POS counter as well as make the service at the POS more hands-free, quick and least interfering. In line with global trends,
INSIGHT RETAIL | ISSUE 03
efore the barcode technology came into widespread use, cashiers manually keyed in the price of every item a customer purchased. These days, a cashier more likely will swipe a product label’s barcode in front of a scanner and touch the keypad only minimally. The use of barcodes in the retail industry can be traced back in the late 1940’s and early 1950’s when the head of a grocery store chain wanted a technical college to figure out a way to acquire product information when a customer checked out groceries. This company president wanted to find a simple way to track his inventory. Two technical students took the idea and ran with it. The two students came up with a working prototype using drawn patterns made from special inks that could only be seen by an ultraviolet light. The concept worked but was riddled with problems. Later, a code made out of a series of lines was implemented next. It was based on Morse code and movie equipment. Next, the technical duo built the very first bar code reader which was big and bulky and used an incandescent light bulb, photo multiplier tube from movie equipment and an oscilloscope, a type of an electronic test instrument that allows observation of constantly varying signal voltages. A piece of paper with lines drawn was passed over the incandescent light source and the oscilloscope “read” the lines and thus, a barcode was born. Unfortunately, this very first barcode technology was unwieldy and not practical to reproduce on a grand scale. It was not until the 1960’s when lasers were more common and the integrated circuit was born that the barcode idea really got off the ground. A barcode represents numbers or letters in a machinereadable format that can be decoded, recorded and processed by a computer system when read by a bar code scanner. The data in the barcode can automatically identify their physical things like trade items (products and services), assets, logistic units, shipments, and physical locations and relationships, parties and locations at any point in the supply chain. The benefits of barcodes to the retail industry include:
• Saving time at checkout counter to the customer • Accurate information due to minimal human intervention thus right price for right product
• Capturing sales data for forecasting, loyalty programmes and replenishment
• Automating pricing and removing the need to
apply pricing labels • Improving supply chain efficiency on using scanning model for front office(POS) and back office (Warehouse stock management) • Making your business processes faster and more accurate back office information for management use which can use for decision making.
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It was not until the 1960’s when lasers were more common and the integrated circuit was born that the barcode idea really got off the ground.
DISADVANTAGES Pricing Discrepancies and Scanning Problems: When discounts apply to bar-coded merchandise, store employees may forget to code in the discount price. This, in turn, can lead to confusion and delays at the checkout counter, inconveniencing the customer, the checkout clerk, and other customers waiting in line. If a barcode cannot be scanned, for any reason, the clerk must then read the corresponding numeric code and enter it manually. Because clerks have become used to scanning barcodes quickly and automatically, without any additional effort on their part, their lack of practice in manual code entries may potentially cause them to be slow and/or inaccurate in entering the information, further delaying the checkout process. Label Damage: Barcodes that are printed on a torn section of packaging, or that have been smeared, smudged or otherwise damaged, will present additional scanning problems. If the corresponding numeric code is also illegible due to damage, the checkout process can be significantly delayed while another package of the same merchandise is located and brought to the checkout counter for scanning. Costly: For businesses that are not already equipped for barcode checkout, the cost of the equipment necessary to implement the new system can be prohibitive. Other delays can occur in training employees to adapt to new equipment, and expensive printers must be purchased to print coded labels for any merchandise that do not come prepackaged with a barcode already on it. It is important to note that Dot matrix and ink jet printers are generally incapable of printing finelydetailed barcodes. SOLUTION
• Check the barcode quality after every six months for each of your products in the stores
• Retailers should carry out barcode cum product audit regularly
• Choose the right adhesive labels for right product depending on the shelve life of the brands either fast moving or slow moving
• Use the right printer for generating the labels. For more information and support on your retail store contact: Retail Consultants t: +254.732 759248 e: email@example.com
Afrique Consult Creating a Customer Service Culture
s there any proven link between customer satisfaction and sales performance? What makes the customer want to stay loyal to your brand and come back again, and again, and again? It all boils down to how your organization makes a customer feel. How then does your organization ensure that it consistently makes customers want to come back for more? Create a culture of customer delighting. An organizational culture impacts the general customer experience. It is more than just hiring the right people or even taking them for training. It is simply about setting an example of customer service behaviour at the top and pushing its way through the employees towards the customers. The organizational leadership and management must set the tone on how they want to treat their customers. At this point, I wish to emphasize that we have both internal and external customers. Internal customers are staff working within an organization while the external customers would refer to the buying clients. In this context then, the top leadership must treat employees like they want the employees to treat their customers. Once an organizational appreciates this concept then a customer service culture begins to take root. It begins with people who want to do the rights things, consistently. At this point then, customer service training can be used to sharpen the skills and create an amazing place to work. So how does an organization create a customer service focused culture? Here are a few tips to help you get on the right path
1. Incorporate customer services as a basic part
of everyone’s work experience. Avail information to ensure that staffs understand what is expected of them irrespective of their level in the organizational hierarchy. The organization must be obsessed with what the customer wants.
2. Be very clear about specifying the behaviour
that employees are expected to deliver, both with internal [coworkers] and external customers
3. Explain why giving excellent customer service is important, not only for the company, but for the staff too. What does your company do that makes life easier for everyone? What does your product or service add? Be sure to include this in the reasons for achieving customer service excellence.
4. Create ways to communicate excellent
examples of customer service both within and outside the company. Institute celebrations, recognition ceremonies, logos, and symbols of the customer service culture and its values. This is where you want the mugs, buttons, and banners. Have a customer service bulletin board to feature service incidents that were special. Seize every opportunity to publicize the times when employees do it right.
5. Indoctrinate and train everyone in the culture
as soon as they are hired. Disney is famous for this. It puts all newcomers through a “traditions” course that details the company history with customer relations and how it is the backbone of Disney. Your orientation program is a key part of the ultimate success of your customer service efforts. Make sure that it contains more than an explanation of benefits and a tour of the facilities. It can be an important element in planting the customer service culture of the company so it can flourish and grow.
6. Encourage a sense of responsibility for group
performance. Help employees see how their performance affects others. Emphasize the importance of “internal customer service.” Help everyone to see that if you don’t serve each other well, you can never hope to serve your ultimate customer.
Afrique Consult Limited is a human resources management consultancy firm offering business solutions to its clients that help align the human capital within the organizations to their business strategy. Afrique’s services are categorized as
1. CONSULTANCY • Strategy Formulation • Systems and Policy development • Institutional surveys • Competency Mapping and Development • Job Evaluation • Advisory Services
2. TRAINING • Customer Delighting • Operations Management • Retailing Management • Supervisory skills • Soft skills [negotiation, decision making, presentation skills, effective communication] • Financial management and planning
7. Establish policies that are “customer friendly” and that show concern for your customers. Eliminate all routine and rigid policies and guidelines. Knock yourself out to be a company that is easy to do business with. Never let your customer service representatives say, “Those are the rules I have to follow; there’s nothing I can do about it.” There is always a way to satisfy the customer. You must give your employees the power to do so.
8. Remove any employees who do not show the
behavior necessary to please customers. Too many companies allow frontline service representatives to remain on the job when they are not suited to a customer service position. If employees don’t want to serve the customer in the best way possible, document their behaviors and use this information to help them change or to move them to areas away from customer interaction.
Anne Wafula Wanyonyi Afrque Consult Telposta Towers, Kenyatta Avenue P.O. Box 10812 GPO 00100 Nairobi, Kenya T:+254.20.2510376/2025822 M: +254 722 817262 E: firstname.lastname@example.org www.afriqueconsult.com
We’re DIT registered:
INSIGHT RETAIL | ISSUE 03
Nakumatt unveils private label to boost local industries
ccording to an online research by Questia, the most impressive brands found in supermarkets of developed countries such as United Kingdom today, are no longer those from globally renowned manufacturers; a new order has emerged-and the growth of the supermarket own brand is responsible. The research further indicates that nearly 22 percent of shoppers plan to buy more own-brand foods and drinks in 2013. With more own-label products launched than branded ones, these products, once aimed at those on low income have moved from the margins to become the rising star of the supermarket shelves. In addition, the leveling effects of grim economies means that own-labels have continued to become popular among many a shopper. Private/own label products are typically those manufactured or provided by one company for offer under another company’s brand. Private label goods are available in a wide range of industries from food to cosmetics. They are often positioned as lower cost alternatives to regional, national or international brands, although recently some private label BLUE LABEL:
Nakumatt Holdings Group Business Development Manager Neel Shah (left) introducing Nakumatt Mega shopper Ruth Kimani (right) to a pack of the new Nakumatt Blue Label Home Baking Flour. Nakumatt Holdings has embarked on a pilot project to introduce the range of Nakumatt Blue Label products as part of a strategy to develop a comprehensive range of private label products.
brands have been positioned as premium brands to compete with other existing at times renowned brands. Back home, supermarket chain Nakumatt Holdings recently started selling basic home commodities bearing its brand- Nakumatt Blue Label. These include household cleaning products, sugar, wheat flour, maize flour and selected grains which are available in its stores across the region. The retailer revealed that it had invested KShs. 200 million into the private label brands venture which it will carry out through contract-manufacturing model. The manufacturers retained by Nakumatt have been selected from a panel of industrialists with experience in contract manufacturing for multinational and local Fast Moving Consumer Goods marketers. “As a regional retailer, we have in the last few years watched helplessly as local manufacturers’ are driven out of business through rising imports of hitherto locally produced goods due to the overall high cost of production for most multinationals locally,” explained Atul Shah, Nakumatt Holdings Managing Director. The venture will also be reaching out to local small and large manufacturers providing them with an alternative opportunity to manufacture and retail quality products under its brand name. Riding on a ‘Trusted Quality at Real Value’ brand promise, Mr. Shah explained that Nakumatt’s private label products are part of supporting local industrialization efforts while providing a lifeline for local manufacturers. The products which are progressively been introduced on Nakumatt shelves are geared at providing the retailer’s shoppers with a range of quality, value for money products. “The products are distinctively branded with an iconic blue band to reflect Nakumatt’s commitment to deliver quality and reliable products,” added Mr. Shah. The Power of Private Labels Globally, private label brands have clearly become a more instrumental priority for today’s retailers as they continue to emerge as a powerful source of competitive strength for retailers. No longer relegated to commodity products, private label brands are competing head-to-head with national brands. This is because retailers have made their own-store brands more relevant to shoppers while offering comparable quality at significantly lower cost translating into a wider choice for customers and higher margins for retailers. ACNielsen, a global marketing research firm indicates that two thirds of global consumers consider them as good alternative to other brands. While there are several drivers of the general increase in shopper demand for private brands, three of the most important include:
The challenging g economy combined with high food price inflation is encouraging shoppers to look for ways to avoid stretching their budgets and private brands provide such money saving options
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The quality of private brand products continues to improve and is now typically as good as that offered by national brands. Shoppers are finding that they can trade to private brands without sacrificing quality and,
Retailers are becoming strong marketers of their stores and unique product offerings. They are actively positioning their private brand programs as an important component of their value offerings; that is providing a key way for consumers to be smart shoppers and save money in their stores ACNielsen further notes that private labels show indication of creating store loyalty. Retailers are beginning to recognize that they cannot simply rely on national branded products to draw consumers into their stores and sustain loyalty. This is due to the fact that manufacturers’ product brands often have the ability to transcend geographic location, distribution channel or even the retailer. The research firm notes that private label awareness and acceptance in developing markets such as Kenya will in part go hand in hand with the growth of the modern trade. Nakumatt plans to unveil a line of spring water, ready to eat snacks, detergents and spices under its Blue Label. The retailer is also in talks with a number of Ugandan, Rwandan and Tanzanian manufacturers to provide a regional manufacturing and retail platform for products’ from the East Africa region including Rwandan coffee.
ince its inception in October 2009, Rivanas Supermarket has been striving to excel in the service it provides to its esteemed customers.
The Nakuru town based supermarket currently operating three (3) branches along Kanu Street, Race Course and Shabab/Kaptembwa areas has become a household name among shoppers from the county and beyond with the management declaring its commitment to ensure that it will stop at nothing to ensure efficiency in service delivery as we plan to expand our chain of retail stores. Simon Mungai, the Managing Director reveals that part of the strategy is to expand Rivanas’ branch network within Nakuru County by December 2013 giving customers a chance to enjoy unrivaled services. “We plan to introduce more than 1000 line items in terms of product variety that will include electronics, mini bakeries, butcheries and vegetables as we seek to meet the high standards we have already set,” he adds. Customers, he says would continue to receive quality services at affordable and friendly prices as well as eco-compliant in line with the Environmental policies of a carbon free country. Apart from delivery service, the management also ensures that the shopping atmosphere within the outlets allows room for prompt service.
INCENTIVE Last Easter, Rivanas run a promotion that gave shoppers a chance to purchase goods at a discounted rate; most of these were consumer goods. Mr. Mungai points that
Where Quality Service is Key We plan to introduce more than 1000 line items in terms of product variety that will include electronics, mini bakeries, butcheries and vegetables as we seek to meet the high standards we have already set
the customers’ response was encouraging adding that such incentives would be introduced from time to time taking into consideration the tough economic times that most Kenyans are undergoing. “We are aware that the hard times have really affected people’s purchasing power thus such incentives should be encouraged to enable them access some of these essential goods” he explains.
CSR ACTIVITY Within the county, Rivanas Supermarket continues to engage in various corporate social responsibility programs (CSRs) aimed at giving back to the society among the underprivileged. Among the activities undertaken by the supermarket annually is giving sanitary towels to women at the Nakuru GK prisons (Women’s day) and also providing food to the inmates’ children during Christmas festive season. “It is only by giving back to the society that our role becomes recognized and appreciated,” Mr. Mungai says. The supermarket is hoping to have this as its annual CSR program. Rivanas is in the process of upgrading its point of sale system to ensure that its customers can use their automated teller machines cards or all other major cards i.e. Master cards, Visas cards as additional mode of payment. Simon Mungai CEO, Rivanas Supermarkets
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RETAIL CSR ACTIVITY
Khetia’s K awards shoppers in style
hetia’s Supermarket, the leading retail chain store in Western and Upper RiftValley awarded its winning customers of the just concluded ‘Sherehekea Ushinde na Khetia’s’ promotion with the biggest prizes ever. The promotion which run from late last November to February 2013 was the first of its kind in which thousands of shoppers constantly won instant prizes at all Khetia’s outlets while over 200 shoppers won huge prizes in the grand draw. The 1st prize winner of a Toyota Probox, Mrs. Everlyne Mukunzi, a teacher at Kolongolo Primary School, in Trans Nzoia County could not hide her joy while receiving her car keys from Khetia’s Director Mr. Ashok Khetia. For over five year, Mrs. Mukunzi has been a regular shopper at Khetia’s Gigamart, Kitale where she has previously won small prizes during other promotions. Sister Celestine Kalunge of St. Domiano Mission Hospital, Bungoma County was the 2nd winner of a Piaggio Tuk Tuk. Other prizes including motorbikes, refrigerators, television sets, and school fees vouchers were also won by customers from within and as far as Lodwar and Nakuru.
Over 200 shoppers won huge prizes in the grand draw. The 1st prize was a Toyota Probox.
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According to Mr. Fred Ochieng, the supermarket’s marketing manager, most shoppers in the region appreciate the services and range of products that Khetia’s continues to offer and thanks to their confidence, the supermarket’s growth is evident. SUPPORT & PARTNERSHIPS Over the years, Khetia’s has continued to support the local community. Recently, the company partnered with several local based stakeholders such as Ace Africa, Kibabii Diploma Training College and Red Cross Kenya amongst
others in initiating several health care activities for residents of Bungoma County. The chain also works closely with the Ministry of Education in promoting education among schools in Western and North Rift regions by rewarding some of the best students during their education days. The supermarket supports needy and brighter students from some of the less privileged families by giving them a chance to pursue their secondary education through the Hamburg Foundation, a brainchild of Mr. Ashok Khetia. On environment, Khetia’s works closely with educational institutions, National Environment Management Authority (NEMA) and the municipal councils within the region, participating in town clean ups and tree planting initiatives. With the advancement of technology, Khetia’s rolled out its unique loyalty programme enabling its customers sign up to ‘Supercard’ and enjoy the endless benefits throughout their shopping. “We have a wider range of products for super card holders to redeem in our outlets,” Mr. Ochieng adds. In July 2013, Khetia’s supermarket plans to open its sixth branch in Eldoret town. Mr. Ochieng says the new branch will guarantee its customers a wide range of quality and affordable products coupled with first class services.
RETRAK to roll out massive recruitment campaign
KShs. 3 billion annually to shoplifters among other shrinkage avenues. “We want to lobby the government to pass punitive laws to discourage shoplifting,” Mr. Gadhia reveals. At the same time, RETRAK seeks to pass a motion that will see members share their employees’ database aimed at discouraging ‘recycling’ of employees blacklisted with vices such as shoplifting.
ewly formed Retail Traders Association of Kenya (RETRAK) is set to roll out a massive recruitment program as it seeks to bring on board more stakeholders to sign up with the association. Bobby Gadhia, the Chairman of RETRAK says the association has hit the ground running and has already signed up membership from the supermarkets’ fraternity. He says the campaign will target stakeholders drawn from those operating in the wider retail arena including; those operating and employed in shops and supermarkets, those in telecommunication and electronic consumer goods’ businesses, airtime dealers as well as those in the clothing and other related accessories but not only limited to these. Also on its agenda is how to tackle pilferage or stock shrinkage. According to industry insiders, with the formal retail trade market estimated to be worth more than KShs. 200 billion, it could well be losing more than
Peter Mulei focuses on product variety
n its bid to take advantage of the real estate boom while offering a one stop service, fast rising chain Peter Mulei Supermarkets plans to venture into furniture in its Mlolongo branch. The supermarket says such products are as a result of the demand by its clientele some who have invested in the real estate sector in Mlolongo and the nearby towns-Athi River, Kitengela as well as the Lukenya–Daystar University areas among other residential areas that the supermarket serves. Located near Solomon School, Mlolongo town, along the busy Nairobi-
Meanwhile, Ms. Hasina Ismail of Hippora/ Retail Management Solutions has joined its Executive Committee to work with Mr. Willy Kimani (Naivas) in handling the association’s public relations issues.
BOBBY GADHIA Chairman, RETRAK
Mombasa highway, the expansive branch offers shoppers an unforgettable one stop shopping experience. Shoppers have the opportunity to sample the branch’s deli, café and bakery services as well as M-PESA and Agency banking. During the last Easter festivities, the chain’s shoppers were treated to a unique offer as the branches sold high breed “live goats” to their shoppers. Peter Mulei Supermarket operates two other branches both within Machakos Town with plans to venture into the counties especially those located in the lower and upper parts of Eastern Province. A 4th branch is set for
losing more than KShs. 3 billion annually to shoplifters among other shrinkage avenues
Machakos town before the end of the year located around the town’s Sokoni area. This will be a smaller branch than all the other branches in terms of size. Based on the recent increased interests among many an investor, to invest in Machakos county the Supermarket is casting its net wider on the expected opportunties. In May 2013, the county received a commitment of KShs. 56.3 billion from investors. In addition, the developemnt of the Konza Techno City, a sustainable, world-class technology hub and a major economic driver for Kenya further presents Peter Mulei Supermarkets with more business opportunties.
INSIGHT RETAIL | ISSUE 03
QR Codes in Retail
R codes can be a really easy to use and beneficial tool in the world of retail. A great way to use QR codes in retail is to place a mobile barcode on the tag of every item in the store. Integrating QR codes into the design of shop window displays redefines the concept of window shopping as shoppers will be able to pull up a whole host of product information such as product reviews, product videos and product range information. Another way QR codes are used in retail is by mobilizing online retail sites and using the codes to drive potential customers to the site to hopefully make a purchase. These QR codes can be placed around towns and cities and can also be placed online on social media profiles such as Twitter and Facebook. The more the QR code is seen, the more it will be scanned, and the more sales a company will make. Utilizing QR codes to enhance promotional materials such as magazine adverts and billboards - up until recently, arriving at a full page advert of a brand’s latest and greatest new product when browsing through a magazine was a fairly one dimensional experience. However, by placing QR codes onto a magazine ad or feature the promotion is essentially expanding brandto-consumer engagement, increasing the time the consumer is interacting with your promotional materials, and more importantly, your brand. This presents to brands when thinking about their promotional materials is limitless. Much in the same way that Lacoste utilized its store displays, the same level or interaction can also be applied to integrating QR codes as part of a magazine or billboard advert. The code really can link to wherever the brand would like the consumer to go, be it an interactive video, a product web page, or a competition within Facebook. Factor in a link from the QR code to the launch of a brand’s latest smartphone app and you have a campaign immediately brought to life. The key will always be in integrating this effectively with other social media, PR and marketing activities via an imaginative narrative that takes the consumer on a journey with the brand. Essentially, what once was a fairly one-dimensional experience within a printed magazine now becomes something as multi-dimensional as the brand’s creative department would like to make it.
Touch POS system in East Africa A first of its kind in Kenya
hoppers at the newly opened Nakumatt Thika Road are enjoying world class point of sale services thanks to the supermarket’s implementation of the Touch POS system.
The system, a first of its kind in East Africa integrates Touch Panel PC with an integrated Magnetic Card, Smart Card and Finger Print Reader. The intuitive touch interface is designed to increase the speed of check out as the cashier does not have to move between the screen, keyboard, mouse and other devices. A single unit made up of the integrated cards and fingerprint readers enable users to swipe magnetic card based debit, credit and loyalty cards, scan finger prints of users and supervisors which replace passwords, and also read smart card based loyalty cards, and in future EMV enabled Visa/ Master cards all in a single neatly designed unit. In addition, the system removes the clutter of cables and other peripherals that are visible in traditional non-touch PC based POS units. The software is designed to run both on touch and non-touch systems by a single key change over while the touch interface has been intuitively designed to reduce keystrokes for every transaction and function thereby increasing speed of operation and transaction.
26 | INSIGHT RETAIL
| ISSUE 03
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ISSUE 03 < June-Aug 2013 >