OK Corporation, who run discount supermarkets, began to collaborate with Scandit to reduce the load on their store associates and improve the efficiency of store operations. As a first step, a smartphone app equipped with Scandit Smart Data Capture was introduced in order to improve the efficiency of in-product picking operations for a new online supermarket service. As a result, it became possible to carry out product picking more quickly and accurately, while also reducing the burden on the store associates assigned to such tasks.
“Scandit’s technology is highly advanced. Their scan engines demonstrate speed and accuracy that are incomparable with those of other scan engines.”
Satoru Tanaka, Executive Officer and General Manager of Information Technology (IT) at OK
OK Corporation operates 135 discount supermarkets in the Tokyo Metropolitan Area and three other prefectures. With a motto of ‘High Quality, Everyday Low Price,’ OK sells valuable, delicious, fresh, healthy and convenient products that have been carefully selected for their high quality.
OK’s business policy is characterized by competition against rival stores on price reduction and an ‘Honest Card.’ Regarding competitive price reduction, OK puts up posters in stores saying “If you find a product that is cheaper elsewhere, please let us know. We will reduce its price.” The aim is to be the store that can offer the lowest prices in the region for national brand products. And through its Honest Cards, OK shares accurate and transparent product information with customers. For example, if the price of a certain product is found to be increasing, OK will honestly announce this to customers and recommend substitute products.
Satoru Tanaka, Executive Officer and General Manager of Information Technology at OK, explains: “Information regarding competition against rival stores and our Honest Card must be quickly updated so as to be reflected on the POP (price tag) when there are changes in product prices or contents. Also, to carry out our responsibility as a retailer, it is necessary to check store shelves and manage inventory to prevent items from going out of stock. We are promoting digital transformation (DX) in various ways to streamline and automate these store operations, increase productivity, and reduce the burden on our store staff.”
Challenge
As part of such efforts toward DX, OK decided to introduce smartphones and utilize an app to reduce manual work related to store operations and promote a paperless environment. When doing so, however, they faced a problem connected with the performance of the barcode scanning engine installed in the smartphone app. Mr. Tanaka comments: “In-store operation includes scanning of an enormous number of barcodes on products. However, some types of packages don’t allow staff to scan their barcodes easily. Even when they can be scanned somehow, if it takes more than a few seconds just to scan one barcode, this will cause stress for our staff.”
While examining various scanning technologies and solutions, Mr. Tanaka came across Scandit, which had just entered the Japanese market. Surprised by Scandit’s technology, which could instantly recognize small or distorted barcodes that were extremely difficult to read with a normal scan engine, he decided to adopt Scandit after testing and confirming its performance.
Mr. Tanaka explains why Scandit was chosen, saying: “Scandit’s technology is highly advanced. Their scan engines demonstrate speed and accuracy that are incomparable with those of other scan engines.” He also adds that adopting Scandit allowed OK “to utilize smartphones instead of expensive hardware dedicated to barcode scanning, which made it possible to reduce hardware costs.”
Aiming to improve store associate satisfaction and achieve cost reduction and streamlining of store operations, OK announced in February 2021 that they would collaborate with Scandit and distribute smartphones equipped with Scandit Smart Data Capture technology to all stores with the aim of reducing the burden on store staff and improving the efficiency of operations.
Solution
In planning the introduction of smartphones at all stores, Scandit was first introduced for picking work at OK’s online supermarket, which opened in October 2021.
Regarding the operations of the online supermarket, OK initially planned to carry out picking work manually by visually checking paper lists. However, a demonstration experiment showed that since it was difficult to visually discern products having many similar package designs, such as dairy products and wine, picking work took a long time and errors such as mixing up products were likely to occur. Therefore, they decided to switch their product identification method in picking work from visual checking to barcode scanning, and to develop a picking app incorporating Scandit.
In order to make the picking app available in time for the start of the online supermarket service, OK proceeded with the development at a rapid pace, and with the cooperation of Mind Isle Co., Ltd. A picking system for barcode scanning was completed in about 3 months.
After conducting further tests and training staff for picking work, the picking app equipped with Scandit came into service in October 2021.
“The picking app that incorporates Scandit is comparable to a dedicated barcode scanning machine, and it exceeded the expectations of the picking staff in terms of its speed and accuracy.”
Satoru Tanaka, Executive Officer and General Manager of Information Technology (IT) at OK
By using smartphones as high-performance and high-precision barcode scanners, it will become possible to reduce the cost of introducing hardware such as dedicated barcode scanners, significantly shorten the time for picking work, and reduce picking errors.
Results
One of the major benefits of introducing Scandit is the reduction of picking time. When picking work was carried out manually by visually checking paper lists, it took about 5 seconds per item, but using the picking app loaded with Scandit reduced this to 2 seconds.
However, Mr. Tanaka noted that the most significant achievement was that the picking error rate, which used to be about 6%, was successfully reduced to almost 0%. Mr. Tanaka continues, saying: “After store associates finish the picking work, other staff cross-check the products. If they notice a mistake during the picking work, they only have to do it again. However, if they notice a mistake during the packing, they need to go back to the picking stage and redo a series of processes. Also, if they do not notice a picking mistake and allow an incorrect item to be delivered, this would cause trouble to a customer and damage the store’s reputation. Therefore, eliminating picking errors has had a profound effect on our work.” In fact, no picking errors have occurred since the opening of the online supermarket.
Homogenization of work quality is listed as another of the achievements. Mr. Tanaka notes: “It’s a great achievement that now even new staff can carry out picking work with the same efficiency and accuracy as skilled staff.”
Another benefit of using Scandit is that in just 3 months it became possible to scan barcodes with previously purchased smartphones instead of spending on additional hardware. Introduction of readily available smartphone apps is also expected to facilitate future extension.
To start with, OK opened four online supermarkets with a plan to expand more in the future
Future prospects: Aiming to further utilize Scandit to improve operational efficiency and reduce the workload of staff
In addition to improving picking work for the online supermarkets, OK is making efforts to reduce the burden on their store associates by using Scandit. As one such initiative, OK is improving the efficiency of its POP (price tag) management work.
OK’s notation contents on POP are strictly controlled, and if it is necessary to make changes, the POP contents must be replaced at just the right time. However, since each store has an enormous number of products and the prices and comments displayed on the POP differ depending on the store, it is not easy to check them.
Therefore, says Mr. Tanaka. “We decided to put QR codes on the POP and scan them with a smartphone app equipped with Scandit. By checking version information included in the QR codes, our staff can instantly determine whether or not the contents of the POP shown to customers are correct. Until now, the staff visually checked the contents of the POP, but this initiative will greatly improve work efficiency and prevent checks from being overlooked.”
Mr. Tanaka also talked about the future prospects, saying: “Since mistakes are not tolerated in picking work and error checks on the POP, which causes a lot of stress for our staff, using Scandit was found to improve work efficiency and reduce the burden on our store staff. We will continue to further promote DX utilizing Scandit with the aim of reducing the burden on staff and streamlining operations.”