September 30, 2004, 12:00 AM

POS will never be the same

(Page 3 of 4)

But a web-based system makes these functions available in a multi-tasking environment while also making them faster and more universally accessible, Ehlers says. "It`s easier with persistent high bandwidth and a connection to work off a central server," he says. Not only does the web-based system make information available in real time, but it can also give field and headquarters managers as well store personnel universal browser access to information.

Just as important, Ehlers adds, such connectivity won`t interrupt other vital operations. Dialing up to a central server to check cross-store inventory levels, he notes, would interrupt a store`s ability to process credit card transactions. "Once we have persistent bandwidth, we`re capable of multi-tasking," he says.

Pacific Sunwear is developing its POS system on IBM`s iSeries application platform, which supports integration of POS with inventory management, merchandising management, and the e-commerce platform of the retailer`s web site, PacSun.com. It`s working with Park City Group and Vanguard Managed Services on network integration, and with Cicat Networks to line up DSL connections to its stores.

Talking turkey at Sheetz

At Sheetz, the web-based system of tying POS data to inventory management coincides with the chain`s strategy of using self-service kiosks to speed lines and give customers the option to pre-order meals before continuing to shop for other items. With 300 locations in Pennsylvania and four other states, Sheetz has about three kiosks per store, providing customers with an efficient ordering system that frees up store clerks to focus more on preparing sandwiches, Moulton says. For each order, the kiosks print out a receipt with a barcode. The customer can continue to shop throughout the store, then pay for all items including the kiosk order as they`re scanned at the POS counter.

Once the customer completes payment, the POS system records the transaction and forwards information regarding the value and identity of purchased products to a central web server on Sheetz`s corporate intranet, which uses IBM`s Websphere platform. Although Radiant can configure the system to constantly stream POS data, Sheetz chooses to receive it once every hour. The store manager or executives at headquarters uses a web browser from any Internet-connected terminal to access reports on POS activity.

Under Sheetz` older system, which it still uses in many stores, store managers conduct physical counts of inventory levels without the benefit of near-real POS transaction data to determine replenishment needs. "Under the new system, if a customer orders a six-inch turkey sub, I`ll know that we need to replenish a six-inch set of turkey," Moulton says.

The system is also set up with a method of generating purchase orders based on current levels of inventory. Managers review purchase orders that the system automatically generates once POS data indicate that particular materials like sliced sandwich turkey have dwindled to levels set by Sheetz. After reviewing and, if necessary, modifying the purchase orders to reflect special needs such as extra supplies for a coming holiday weekend, managers click a button on a web page to forward the purchase order to a supplier.

Tighter inventory

The integrated inventory management system also monitors POS data for the other products sold throughout the c-store. "The system can be configured so that when cigarettes get below a certain number, it says it`s time to re-order," Moulton says. "This will allow us to operate with tighter inventory levels."

In addition to controlling inventory levels, the web connection to the combined order management and POS system lets managers access a web browser from any location to perk up the menu with promotions and hot items. They can modify the options appearing on the touch-screen menu, including recipes and product images, pricing, and even the appearance of screen icons and the method of navigating the screen, so that it will present more cross-selling opportunities as well as more varieties for customers. "We can change the menu faster," Moulton says. He adds that Sheetz is careful to work out processes with store managers, to assure that they prepare stores with signage and food materials to support menu changes.

Sheetz declines to give the cost of its Radiant POS system, but Radiant notes that a typical configuration for a c-store with two POS terminals, product scanning capability and a web-based administration tool would range from $12,000-$15,000 per store, depending on the number of stores.

Reaching to the customer

As web-based POS continues to evolve, retailers will use such systems to support more interactive merchandising and marketing efforts to better communicate with customers. Some of these new efforts are already underway in early projects, says Mark Indermaur, software marketing manager for the Retail Store Solutions group at IBM Corp.

Grocery chain Stop and Shop is beginning to use IBM`s Personal Shopping Assistants, which are web-based tablets in shopping carts that let shoppers scan items as they shop, and see a running price total on the tablet screen. And because the device connects with applications that store and analyze POS transaction data, including data for particular shoppers identified by loyalty or credit card accounts, it will display special promotions likely to be of interest to the shopper. The web device also lets shoppers place orders to a store`s deli section while shopping in other parts of the store, alerting them with a beep once their deli order is ready.

Another IBM-supported product, Sign and Go, is designed to reduce the likelihood of credit card fraud at POS counters. To use the system, cardholders must record six live samples of their signature, allowing the system to monitor multiple attributes of how the person signs his name, including the speed and pen movement at multiple points. When a customer signs for credit card purchase, the system matches the actual hand movement with the recorded signings through a real-time web connection. Customers don`t even need to show their cards or other identification. "Shoppers can just sign and leave, they don`t even need their wallets," Indermaur says.

At Pacific Sunwear, Ehlers has his eye on more conventional near-term uses of web-based POS, as the retailer rolls it out to more stores as well as integrates POS data with back-end applications like inventory and CRM. "It opens up a lot of possibilities," he says. "We may use it for distributing streaming video marketing messages to stores."

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