Case Studies

Auchan Hypermarkets Eliminates Empty Shelves with New ADC System

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The introduction of Intermec’s handheld computers in Auchan’s 35 hypermarkets has produced a marked improvement in the order/ delivery flow, cutting working times and eliminating the possibilities of error.

Drawing up “products to be restocked” lists, inputting orders and sending them to the depot: these three operations are now carried out by the head of department using a single gesture: just pointing the scanner at the product. Using this simple action, the operator can obtain all the necessary information and can transmit the order directly to the warehouse, reducing work times and the possibility of error during input.

After becoming part of the Rinascente Group in 1997 and taking over the Citta’ Mercato retail outlets, the Auchan trademark now includes 35 hypermarkets spread throughout the country.

The commercial agreement, which saw Auchan, one of the largest retailers in France, acquire a 49 per cent stake in the company, was followed by a process of operational unification leading to the integration of commercial, administrative and IT resources in the hypermarkets.

Labeling

The first approach between Intermec and Auchan dates precisely from this time, following the supply of Barcode printers in 2000: before being put on sale, incoming goods must be catalogued with a barcode label.

“Between 2000 and 2001,” explained Marino Vignati, head of IT systems for the Hypermarket Division, “we felt the need to convert all the systems used in the outlets; the two companies had to become integrated and we had to standardize our way of working, the terminology and the system of calculating margins. The IT system helped us to unify the company. The first problem to be tackled was that of re-labeling, and it was at this point that we contacted Intermec.”

Data Collection Using Intermec 2415 Handheld Computers

After the successful experience of the barcode printers, Auchan tackled the problem of data collection. Until then, operations inside the retail outlet had been carried out in a semi-manual fashion, using several individuals to monitor the shelf situation, deliver this information to the central office and then, from the central office to the warehouse.

“Before introducing our wireless systems,” said Walter Roffinoli, Sales Manager of Intermec Technologies, “we used what we technically define as a Batch system: information is collected from the shelf and stored on a portable computer, and then you return to the office to carry out data collection, which are then uploaded into the IT system. There are plenty of ‘downtimes’ during this process, caused by the necessary movements to realign this information.”

Auchan therefore decided to accept Intermec’s proposal and to use wireless methodology to make its retail outlets more efficient.

A total of some 400 2415 handheld computers were supplied, about a dozen in each site; moreover, two 2101 Access Points were installed in each outlet so that the main areas of the store could be constantly connected to the IT system. This new technology has allowed Auchan to make constant savings in terms of management costs, and above all to optimize resources.

“This technology,” said Marino Vignati, “has allowed us to bring the company’s IT system to the front of the shelf. This ensures consistent and effective updating, with more precise information in real time.”

Work Organization Advantages

Changes never occur simply, but pass through information reorganization processes: the introduction of radio frequency changes the methods and the way people work. Some operations can be carried out at shorter intervals, thereby making information more reliable (e.g. consistency between label price and till price). It takes considerably less time to obtain information or to alter it and some operations which previously required several persons, can now be carried out by just one.

Information collection has been considerably simplified: the operator checks the shelf, points the handheld device at the product and detects reduced stocks; he can immediately see how many orders have already been sent to the warehouse, as well as the delivery schedule, and if necessary he can make a correction which is immediately transmitted online to the warehouse.

The barcode displays the “product status” and any correction is sent to the warehouse without using a middleman and with no possibility of error.

This technology produces radical changes in the organization of work: on average this activity previously took 9 hours a day, but it is now reduced to 2, with significantly fewer errors.

“Intermec works with Auchan,” continued Vignati, “as a partner and not just as a supplier, therefore it presents itself as a company that can help to resolve the problems of reorganizing data collection. We are now tackling the problem of the inventory, which is not an easy undertaking. We would like to cut the number of hours spent working on this activity. Closing down the store to take the inventory means loosing sales, while still incurring personnel costs.”

Radio frequency and the efficiency of this technology can be used to achieve a number of goals: lower costs to the company, more time available to dedicate to other operations, drastic reduction in the margin of error.

The operators have reacted well to the introduction of this new technology and, in particular, have welcomed the aspects concerning its manual handling, namely the ergonomics, the visibility and the weight of the handheld computer, making it suitable for extended use during several hours’ work.