GEISSLER'S IMPLEMENTS INFRARED ESL SYSTEM 2004-08-09 (2)

JULIE GALLAGHER

EAST WINDSOR, Conn. -- Geissler's Supermarket here has completed a month-long implementation of an electronic shelf labeling (ESL) system from Pricer, Sollentuna, Sweden.

The installation leverages an advantage from Connecticut law that exempts retailers from individual item pricing if they use ESL.

The five-store independent is currently rolling the solution out to three additional Connecticut stores.

While many ESL solutions communicate price changes via radio frequency (RF), Pricer's system is powered by infrared technology.

Jim Nilsson, Geissler's president, said the infrared feature influenced his decision to implement the wireless technology. "Infrared technology is a little cleaner than [RF] because it requires no wiring or antennas," he explained.

The Pricer system works with a transceiver device that both transmits and receives data. "Since the system is communicating two ways, the need for placing different antennas throughout the store is eliminated," said Pontus Lundqvist, sales manager, Pricer.

Pete Abell is a senior partner at ePC Group, Boston, and acts as a consultant on radio frequency identification systems. Abell pointed out some of the pros and cons of infrared systems.

"Infrared can be faster and better at locating targets within a much smaller area than RF," he said. "Also, the amount of battery power that infrared requires is less than RF, so infrared might be cheaper to maintain and better for the environment."

However, Abell disagreed with some who say that infrared is preferable to RF systems. "Ten years ago, I might have said that infrared technology is a better choice than RF [for use with an ESL system]. But as long as ESL manufacturers work to implement RF standards, retailers looking to invest in it will get multiple bangs for their buck." He stressed that as use of RFID technologies by retailers grows, their cost will drop.

Implementation of the ESL system began with the installation of LCD pricing and information modules at the shelf edge. Color coding and font size requirements for LCD labels used with ESL systems are set forth in guidelines issued by the state of Connecticut.

Retailers operating in Connecticut must apply to the state in order to gain certification for use of an ESL system. During the process, users describe how the system will work. Users also outline price-changing contingency plans that will be put into practice in case the system fails.

Certification is issued if the retailer passes an in-store review that occurs within a few weeks of the system's going live, said Ray Carlin, president and chief executive officer, StoreNext, Plano, Texas.

Geissler's purchased the Pricer system through StoreNext, which established a marketing agreement with Pricer a year ago.

The retailer integrated the Pricer software with its existing Retalix ISS45 POS system. Subsequently, price integrity checks were made.

Price changes at the retailer's East Windsor location are executed via a handshake protocol between the food retailer's POS system and the Pricer system, stated Lundqvist.

Each item's Universal Product Code is associated with a corresponding electronic shelf label's serial number for identification purposes. Once a label is sent a price, its receipt is acknowledged via a response communication sent from the label to the transceiver.

"The Pricer system will automatically search for labels it cannot find at the correct shelf location by performing a roaming task," said Lundqvist. "This allows the store to easily re-merchandise products without performing any move process with the ESL application."

Pages of data contained within each of Geissler's electronic shelf labels can be accessed directly through the label with an infrared pen.

"The information can contain any number of data streams depending on which applications the system is interfaced to, such as planograms and inventory information," clarified Lundqvist.

The system eliminates the need to manually change labels at the shelf and item level. Nilsson projected the East Windsor store will pay for its investment in a year with the labor savings it realizes. He did not provide specifics about Geissler's investment in the system.

Typically, each label costs $7.50. Independent retailers often use about 10,000 labels, Carlin said. "Infrared [ESL systems] have lower implementation costs, and do not require as many infrastructure changes [as those using RF]," he noted.

"Infrared technology has the capability to update 50,000 labels per hour," said Lundqvist. "Whereas a radio system might be lucky to accomplish one-tenth of that."

Many states require the pricing of individual items, even when ESL systems are used.

Geissler's Massachusetts location will not use ESL because its return on investment would not justify implementation in a state that requires individual pricing of items, said Nilsson.