How digital price tags helped a SPAR owner keep customers and be profitable

30 Mar, 2022
Tertius Nortje, the Group CEO of Christiana, Douglas, and Hartswater SPAR & TOPS

There is a reason SPAR Group’s wholesale turnover for the core food business grew by R5 billion from 2019 to 2020.

Besides SPAR’s brand power, store owners like Tertius Nortje quietly move the needle forward based on their everyday, real-life challenges. And customers take note.

“In 2009, people were abandoning their trolleys at my tills,” he says. “Because they couldn’t find prices for the products on the shelves, or there was a discrepancy between the shelf and till. That’s lost sales.”

His merchandisers, he says, weren’t placing the price labels on the shelves, or they would fall off, or customers would sometimes go and take them off the shelf to show the clerk that there was a discrepancy. It was hard to manage with between 14,000 and 16,000 labels in each of his three SPAR and TOPS stores.

Besides lost sales, his range would also diminish over time as products were purchased by customers, not restocked, but the space filled with other products. It was very hard to manage stock and inventory without firm accountability.

Then Tertius, the Group CEO of Christiana, Douglas, and Hartswater SPAR & TOPS, noticed digital price tags at a SPAR trade show.

“They cost a lot of money. I had to close my eyes and just put it in. But the money I paid, I have it back now, no two ways about it,” he says. “Besides the small tax benefit, what’s your reputation worth, and the reputation of SPAR, especially when there’s competitors knocking on your door?”

“People like Tertius understand that retail never stands still, and you can never be complacent. He’s not alone because 21% of all South African SPAR owners agree that it’s worth it,” says Hendrik Bredenkamp, MD of NEC XON Retail.

Digital price tags are so good he bought them three times

In 2018 Tertius added Christiana and Hartswater SPAR and TOPS to his existing stores in Douglas.

“I had the same problems at the other two stores, so I put the labels in there as well,” he says. “Now there’s no problem.”

Customers like the flashing lights on the labels. It draws their attention to the promotional offers, which helps Tertius increase his rate of sale.

It is an important metric that can help to improve revenues, GP, and profitability.

“You have a remote that fits in your pocket and you can use it to show the rate of sale on the actual price tag itself,” he says. “I can also make the labels flash if there’s low stock or no stock. Together with the rate of sale, I can see what’s performing and what’s not, where I could improve revenues and customer experiences, and rearrange my shelves accordingly.” All without reams of paper records and immediately revealing stock room inventories. Customers love it.

Benefits

The digital price tags offer numerous benefits. They help save time with automatic price updates by doing 90,000 price updates per hour automatically. They ensure you have accurate prices for all products on your shelves. The labels cannot be easily removed or replaced, so prices are always visible, and you never lose range. It’s more cost-efficient than paper and improves your customers’ experience with accurate, reliable pricing. The shelf labels have a 10-year battery life. Promotional flashing calls attention for promotional offers or stock and inventory management.

When the VAT rate changed in 2018, Tertius’ system updated the entire store within 5 minutes.

“Other stores took two weeks,” he says. Besides being disruptive and costly, paper labels don’t enable progressive digital capabilities such as click and collect, online shopping, and replenishment routing.

“It’s neat, tidy and the only negative is the price. It seems expensive,” he says. “But it’s worth it.”

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