Efficiently and actively safeguard store processes - Fujitsu profit protection

Retail Challenge

“Shrinkage” — stock that goes missing for various reasons, including scanning errors, theft and fraud — costs US retailers nearly $100 billion annually, according to the NRF. The problem is likely to get worse. Faced with a shortage of employees, most retailers are still accelerating plans for self-service checkouts, where shrinkage levels are at their highest. Theft is also on the rise as the cost-of-living crisis grows. UK stores, for example, recorded an 18% increase in retail theft in the year to June 2022, according to the Office of National Statistics (ONS), with even worse likely to come with UK grocery price inflation hitting a record 14.7% in October 2022. In discussions with Fujitsu since the end of 2022, all retailers confirmed their challenges with the increase in inventory discrepancies, particularly through the use of SCO (self-check-outs).

At NRF 2023, the AI enabled solution extension "merge & match" was successfully presented to the public, which automatically cross-references transactions and video information and matches them for anomalies. For example, if a customer fails to scan items or if barcodes are switched in the scanning process, merge & match automatically detects discrepancies (mismatch) between what happened in the video and the transactions that were actually scanned at the SCO - and immediately informs the person responsible in the store.

Approximately one-third of shrinkage is usually attributed to employees, making that a $30 billion annual issue in the US. Transactions where errors and fraud are known to be high include deposit return schemes, price mark-downs and price-check scans. Barcodes that fail to scan are another problem for retailers. When staff cannot get a barcode to scan, they book items manually – but often just to a top-level category or to the wrong line. These accumulated errors create significant inventory differences and incorrect replenishment data.