Retail Executive

JAN-FEB 2018

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form shelf audits, because complex object recognition video systems are not required. Firms operating in this space include MetraLabs' TORY, Keonn Technologies' AdvanRobot, Fetch Robotics' Robi, and Pal Robotics' StockBot. According to MetraLabs, TORY is the first permanently installed RFID robot worldwide at AD- LER Modemärkte in Germany. THE TOP EMERGING APPLICATION The robots discussed above operate semi-autonomously. For instance, they can guide a customer to a shelf, but the customer must then retrieve the product. The next wave of robots in retail are fully autonomous, where the ro- bot can manipulate merchandise, such as retrieving the product for a customer or stocking store shelves. While stocking a store shelf, for example as in a grocery store, may seem simple for us humans, such fetch-and-place tasks are complex, requiring extensive extended percep- tion and reasoning capabilities. Nevertheless, advance- ments in technology are making this possible. Due to the complicated environment of a store and the complexity associated with matching human dex- terity, robots are arriving late to the retail industry. Notwithstanding, advances in cognitive abilities are improving their ability to effectively function in retail environments. The result: Robots will soon be arriving at a store near you. R ▶ Simbe Robotics' Tally: like Bossa Nova, Tally uses image-recognition technology to audit shelves to determine out-of-stock, low stock, misplaced items, and pricing errors. Grocer Schnuck Markets ran a six-week pilot with Tally over the summer. THE NUMBER-ONE ROBOTIC APPLICATION The use of autonomous navigating robots that track inventory via RFID is, in our view, the most important robotic application for retailers to consider. This allows for the continuous measurement of inventory accuracy and item location for omni-channel fulfillment, as ro- bots navigate a store multiple times a day. The benefits of RFID technology have been well-doc- umented. For example, in a 15-month study at Macy's, monthly cycle counts taken by hand scanners result- ed in gross unit variance being maintained in a 2 to 4.5 percent rate, versus a 20 to 30 percent annual distortion due to only once-a-year physical counts. Omni-channel fulfillment is another major benefit associated with RFID, by making single merchandise units visible systemwide due to the ability to locate RFID-enabled merchandise. 7 Yet, the benefits of RFID are still muted, to some ex- tent, in that staff must manually scan merchandise. Due to the associated labor costs, this may occur only monthly. Fixed reader systems, which are capable of more frequent tracking, on the other hand, are expen- sive to install. In contrast, a robot that wanders a store can take multiple cycle counts during a day, greatly enhancing the value of RFID. Interestingly, in a test of handheld reader versus robot-read accuracy, the robot handily outperformed the handheld scanner (perhaps due to human error, i.e., forgetting to scan an area). The researchers found, for example, in the menswear department of a store that the robot achieved a read accuracy of 99.8 percent versus the handheld read ac- curacy of 77.9 percent. 8 The elimination of labor costs associated with scan- ning inventory, the robots' ability to take multiple cycle counts daily, and increased accuracy all should encourage savvy retailers to stay on top of this trend. While, of course, RFID-based inventory robots come at a cost, they are less complicated than those that per- 1 The International Organization for Standardization defines a robot to be an "actuated mechanism programmable in two or more axes with a degree of autonomy, moving within its environment, to perform intended tasks." 2 Economic Report of the President, together with the Annual Report of the Council of Economic Advisers, 2016, p. 231. 3 See: "As Amazon Pushes Forward with Robots, Workers Find New Roles," New York Times, 10 September 2017. 4 Published by the International Federation of Robotics. 5 A variant on this, that is still a way off, is robot agents that shop with you and make product suggestions based on your purchase behavior. 6 Available at: https://blog.walmart.com/innovation/20171026/thats-smart- see-the-tech-helping-us-serve-you-better. 7 See: "Quantifiable Benefits and Analytical Application of RFID Data," PRI Working Paper, January 2017. 8 "Development of an RFID Inventory Robot," Robot Operating System, 2017, p. 387. The next wave of robots in retail are fully autonomous, where the robot can manipulate merchandise, such as retrieving the product for a customer or stocking store shelves. S T E V E N K E I T H P L AT T is director and research fellow at Platt Retail Institute, an international consulting and research firm that focuses on the use of technology to impact the customer experience. He also serves as research director at the Retail Analytics Council, an initiative between Northwestern University and PRI. RETAILEXECUTIVE.COM JANUARY/FEBRUARY 2018 29

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