ICT and Supermarkets

Supermarkets today
Think of a journey through the modern supermarket. You enter a brightly lit, welcoming store, each
shelf laden with the widest choice of food and goods for you to buy.
A typical outlet will have about 20,000 different items. ach with its own price and !special deals! "
#buy one get one free$#, #half price# ... how is all this tracked and kept up to date%
Barcodes
Almost every item that you purchase in a shop has a barcode on it. These look like a series of
thick and thin black lines with a series of numbers below.
&nce the barcode is scanned using a
barcode reader, the database can find
the product details that the barcode
relates to. ach type of product will
have its own barcode, for e'ample
small cans of baked beans will have
one barcode, medium cans another
and large cans another. These will differ from the
barcodes on cans of spaghetti and ravioli.
The barcode contains data about the type of product, si(e,
manufacturer and the country of origin.
)t also contains a check digit, so that the computer can validate that the data has been read in
correctly.
The barcode does not contain price. The price is held in the database instead. This makes it easy
to change if there are special offers or prices go up. )magine if the price was part of the barcode.
very time the price changed, you would have to replace all of the packaging.
&nce the barcode has been recognised by the database and the price found, the data is sent from
the central computer to the till *lectronic +oint of ,ale " +&,-.
Stock control
After the item has been scanned, the barcode is passed to the stock database in the central
computer.
&ne of the fields in the database contains the amount of stock of that particular item which are
currently in the supermarket.
ach time the barcode is scanned, the computer reduces the level of stock for
that product by one.
.hen stocks fall to a certain level, called the re"order level, an order for more
stock is automatically sent to the warehouse. The items will be delivered by lorry the ne't day.
This system gives the manager an accurate and up"to"date record of the current stock levels at
any time.
Barcode reader
)t also enables them to keep a close eye on what is and isn!t selling. This means that they can
hold stocks at the right level, and order their delivery just in time.
The stock level isn!t always /000 accurate. )f a customer steals an item then it won!t get scanned
and the stock control system will still think the item is in the store. A cashier might accidentally
scan an item twice or not scan one at all. That would also result in the numbers in the database
being incorrect.
EFTPOS
+&, tills allow their customers to pay for their shopping using a debit or credit card instead of
cash. *+&, 1 lectronic +oint &f ,ale-
The money has to be taken electronically from the customer!s bank account and paid to the
supermarket!s account. This process of moving money is called
lectronic 2unds Transfer at the +oint of ,ale or 2T+&,.
&n the back of a debit card, you will see a black magnetic stripe.
This contains the electronic details needed to allow money to be
transferred from your account. The card is swiped through the
magnetic reader on the till, which allows it to pick up the
information. At that point, an automated re3uest for approval is sent
to the bank computer via the telephone network.
The bank computer checks that there is enough money in the account to complete the purchase.
)n order to improve security, the bank 4 credit card computer also checks to see if the card has
been reported as stolen. )t will also check for unusual spending behaviour when using that
particular card to spot possible fraudsters. 2or e'ample, if that card is used /000 of the time in
5eeds and now it is being used heavily in 5ondon, it may ask the customer to prove their identity at
the shop.
)f everything is fine, a message is sent back to the +&, unit to authorise the purchase and funds
are transferred from your account to the merchant account.
The supermarket needs to be sure that the card does belong to the customer and the customer
wants to be sure that no one else is using their card. ,o in order to authorise the money being
taken from the card, the customer has to enter a four digit code. This system is called !6hip and
+)7!.

Loyalty cards
,ome large shops such as supermarkets run loyalty card
schemes.
.hen a customer applies for a loyalty card, they have to fill in an
application form which asks for personal details such as name,
home address, email and so on.
)n return, they are issued with a 5oyalty card that resembles a credit card in si(e and appearance.
The loyalty card only contains their customer membership number.
The card is swiped when the customer buys something and they are rewarded! with a discount,
typically /p for every 8/ spent.
This would only seem to benefit the customer as the entire scheme is free of charge. 9owever,
supermarkets also benefit in other ways.
)ncrease the amount customers spend as they are keen to get their loyalty points
:uild up a profile of their typical customer e.g. age, gender, average spend etc.
Track customer spending habits
&ffer special promotions in partnership with other companies e.g. hotel discounts
;easure the results of special offer campaigns
,o the loyalty card allows the supermarket to build up a very accurate picture their
customers.
Internet shopping
;any supermarkets are now encouraging customers to visit their web
site and purchase from there rather than visiting the shop. <oods are
usually delivered by mail for things like 6= and =>=!s, whilst food is
normally delivered by truck at an agreed time slot.
6ustomers log onto the company web site, browse through the
categories of food available and choose the products they re3uire.
They can search for goods, look at product pictures and even add special notes to their order, for
e'ample !the lamb joint must be large enough to feed four people!.
As each item is selected, it goes into the !>irtual Trolley! and helpfully, the running total cost of the
goods is displayed.
.hen shopping is complete, the !trolley! is moved to the !+ay for <oods! area of the web site which
is the e3uivalent of the cash till.
&nce payment has been approved *normally by credit or debit card-, the order is transmitted to the
order fulfilment warehouse or local store where pickers pack your order ready for delivery in the
agreed time slot.
.
ICT and customers
6ustomers have benefited enormously from the integration of )6T into the modern
supermarket. ,ome of the benefits are?
" The customer doesn!t need to carry cash with them, they can pay for everything
electronically
" There is less chance of being wrongly charged or given the incorrect change as
the till calculates this for the cashier
" An itemised receipt is given so it is easy to check that you have been charged correctly for your
purchases
" @ueuing times at the checkouts are reduced as it is faster to scan items than to find the price and
type it into the till
" :ecause of the stock control systems, most goods will be in stock for the customer
" 6ustomers have a choice whether to visit the shop or purchase using the internet.
ICT and the supermarket
The use of )6T in supermarkets has brought about many benefits for the company. ,ome of them
are listed below?
There is much less chance of human error because the till
calculates the total amount due and also calculates the
amount of change to be given
6ash is rarely used to pay for items so this reduces the
opportunity for theft
6ashiers can process customers more 3uickly and keep
3ueues down
,pecial modelling software can be used to work out how many cashiers are needed on the
tills at any given time. This cuts 3ueues down but also means that cashiers aren!t sat doing
nothing
The price of an item can be altered in a matter of second simply by entering the new price
in the database
There is no need to pay staff to price goods or to order stock
<oods are only ordered as needed so there is less chance of
stock going out of date
)t is easy to analyse sales to find out which are the best sellers
and which items are hardly selling
+revious trends can be analysed. 2or e'ample, if they know the temperature is going to be
2A degrees today they can run software that will tell them how many e'tra ice creams and
barbe3ue items they are likely to sell
5oyalty card schemes make it easy to track customer purchases and spending habits
Technology can be used to maintain the correct temperatures in the shop and also for
chiller cabinets
)n summary, )6T allows the company to understand their customers better, it allows for easier
stock and money control as well as making it easy to try out new ideas and promotions.
ICT and supermarket employees
.hen )6T was first introduced into supermarkets, there was a
huge impact upon employees.
7o longer did items need to be individually priced. This reduced
the need for so many staff.
6ashiers at the tills became /A0 more efficient due to the
increased speed of scanning rather than looking for the price and
typing it in. 9owever, they can be monitored to check how many
items they are scanning per minute and mistakes are easy to spot.
2ewer staff were needed and those that remained needed to be retrained to use the new
technology. There was often resistance at first due to fear of the computerised tills and worry
about possible redundancy.
Although some staff lost their jobs, many new jobs were created. 2or e'ample in larger stores a
network technician may be needed to help look after the computers and data.
The future
Technology is continuing to change the way that supermarkets
operate.
" ;any supermarkets are beginning to introduce self scanning.
The customer can either scan the price of their items as they walk
around the shop or they can scan them when they reach the
checkouts. This can lead to some customers cheating and not
scanning everything but generally the supermarkets feel that the
saving in staff wages will offset any losses.
" ,mall computers integrated into the trolley can help customers to find their way around the store
and to locate items more 3uickly. .ant some ice cream but don!t know where to find it% Type #ice
cream# on the touch screen and you are directed to the correct aisle " floor plan included. Begular
purchases show up on a favourites list, with price and location. ,pecial offers are flagged up as
you move from section to section. .rite your shopping list online " at home or work and soon it will
be automatically downloaded to the trolley!s computer.
,elf ,canning ,ystem
" )ntelligent weighing scales are now available. They contain a
digital camera which can recognise an item such as apples,
weigh it and print a bar"coded price tag.
" Badio 2re3uency )= tags *B2)=- are being used on more
products in the supermarket.
They are tracking devices which can be used to tell the
supermarket e'actly where a product such as a 6= is at any time
whilst in the shop. They can be used to identify if the 6= has
been put back on the wrong shelf or dumped in a different part of
the shop by a customer who has changed their mind.
They can also be used to spot whether an item is being stolen.
Assignment questions:
1. Give four details that are stored on a barcode.
2. Does barcode contain price? If not, why?
3. Where do you find the price of a product?
. !a"e an input device used to read barcodes at the tills.
#. !a"e three applications that "a$e use of barcode.
%. Describe how auto"atic stoc$ update is carried out at tills or &''() usin* barcodes.
+. Give two "erits and two de"erits of auto"ated stoc$ control.
,. Describe the process ta$in* place at &-.'().
/. What are loyalty cards?
10. Give three benefits of issuin* loyalty cards to the custo"ers.
11. Give three advanta*es of usin* I1. in &'() 2&lectronic 'oint of )ale3 has over
a3 1usto"ers.
b3 1o"pany
c3 &"ployees.