Since July in Lithuanian shopping malls plastic bags are no longer free-of-charge. The move aims to reduce the plastic waste generated by the retail sector. However, retail still generates a sizable amount of paper waste. Price labels, which are frequently changed during sales promotions, is one of the sources for paper waste in retail. Moves toward sustainable operations, better shopper experience, as well as growing labor costs drive retailers to adopt electronic shelf labels.
“You might not even notice it – yet two of the largest Lithuanian grocery retailers have already switched to electronic shelf labels. We predict that in the next year all major grocers will move to electronic price labeling, with specialized retailers to follow suit”, says the CEO of retail technology solutions provider Neto Baltic Rokas Budvilaitis.
Electronic shelf labels (ESL) are hard to distinguish with a naked eye. Built using high-definition e.ink displays, in appearance they are nearly identical to paper. However, ESL solutions provide additional benefits for retailers, as well as shoppers.
“Larger stories carry over 40.000 products in stock. Once a month price labels for 3000-5000 products are replaced, with sales promotion or happy hour posters also printed. On one hand, you have a lot of paper waste generated each month. Additionally, shelf label management is a labor intensive manual task. Instead of printing and replacing shelf labels, they can be updated with a single click of a button”, – tells R. Budvilaitis.
ESL adoption is driven to improve shopping experience.
“Every shopper has experienced an unpleasant situation, when one price is indicated on the shelf, and a different one is called at the checkout. Shelf label management is a mundane task, prone to human errors. Although these incidents are unintentional and accidental, they irritate shoppers. Accidental mislabeling may lead to lost sales, when the shopper will decide to shop elsewhere. These are invisible losses, which are nearly impossible to measure effectively”, ads R. Budvilaitis.
ESL growth in popularity is also a result of technological improvements. ESL got less expensive. They can be managed via a wireless network. Due to improvements in battery technology, ESLs offer up to 10 years of continuous service. They can be installed in freezers, on small products – like cosmetics or eyewear. Special ESL models are offered for fashion retail. They can be used in outdoor retail locations or warehousing, where they can aid order collection.
With buttons installed in the ESLs, shoppers can get more information about the product (e.g. see the shoe sizes available in store) or call the store assistant.
Paper shelf labels are part of the problem relating to retail food waste, specifically products nearing their expiry date. Countries in the European Union generate 89 million tonnes of food waste per year. Retail is responsible for 7% of this number. The European Commission has issued a recommendation to member states to reduce food waste by 30% by 2030.
“Supply chain digitization is the best way to achieve this goal. Today a store employee ‘hunts’ for expiring products and manually labels them with price promotions – a labor intensive and expensive task. By utilizing such solutions as RFID for fresh products to monitor expiry dates, as well as ESLs, RFID enabled packaging could automatically communicate with price labels and automatically reduce the price when nearing expiration”, says R. Budvilaitis.
