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Microsoft and Lakeba unveil Shelfie – an Australian robotic innovation enabling operational excellence among the global retail community

A group of Australian innovators are on the cusp of launching the retail sector’s latest digital transformation, helping optimise profit margins through the power of robotics. The intelligent technology – available now – is a world-first and represents a significant step-up from simply using self-checkout technology to automate day-to-day operations and enable operational excellence.

Despite the rise of online shopping in the last decade, research shows consumers still prefer shopping in-store – driven by a preference to check quality, and seek inspiration[1]. With this in mind, it is critical all retailers, from supermarkets through to fashion brands, can effectively manage stock levels to satisfy consumer demand.

A study from IHL Group suggests this is not happening, however. Overstocks and out of stocks result in $1.1 trillion lost revenue globally, per year[2]. That is, retailers are ordering too much stock and not able to sell it, or not ordering enough meaning consumers are driven to rival brands for alternative products.

Whatever the situation, the outcomes are the same: reduced profit margins. And in an increasingly saturated and competitive industry, inefficient stock management is a risk retailers cannot afford to make.

Step forward – or should I say roll or fly forward – Shelfie. A new innovation from Microsoft Australia partner Lakeba combining the latest robotic technologies with intelligent image capturing and data analytic solutions running in the cloud, empowering retailers to grow sales revenue through improved stock management. Shelfie is an in-store robot with the ability to automatically travel around stores scanning shelves, enabling real-time stock reporting via the Shelfie Dashboard which is built on Microsoft Power BI to help identify sales trends and provide intelligent insights to optimise merchandise layouts.

The unit is available as a robot, drone, or hand-held device, and depending on store size can undertake a complete inventory check of a supermarket within three hours.

Shelfie Air unit in action

With an initial focus on the retail grocery sector – the Shelfie solution will soon be piloted at UK-based supermarket Co-Op – Darren Younger, Shelfie CEO and non-executive director at Lakeba says Shelfie differs from other retail-focused robots due to the increased visibility it enables around stock and day-to-day operations.

“Shelfie equips retailers with a new KPI around how quickly stock gaps are addressed, or new merchandise planograms and ticketing are rolled out – something that until now stores have been unable to measure. Ultimately, Sheflie optimises in-store sales opportunities – preventing missed ones, and promoting the best,” said Younger.

“For example, once a gap or discrepancy is located, an alert is sent out to ensure it is quickly fixed so that the sales opportunity is not missed. Similarly, it streamlines reporting around sales trends providing retailers with intelligent insights enabling localised special offers,” said Younger.

“At Lakeba, we’ve labelled the retail industry’s newest KPI the Shelfie Index – a 0-100 score based on store stock, and layout. We forecast that beyond optimising existing revenue chains, Shelfie can deliver cost savings of up to $300,000 per store per year – for a grocery retailer operating hundreds of stores it can quickly equate to a sizeable saving, freeing up time and resource to be invested in other operational areas.”

Australian Retailers Association Executive Director Russell Zimmerman stated that the Shelfie robot will revolutionise retailer’s ability to review stock levels, ensure that out of stocks are kept to an absolute minimum, ensuring that retailers are able to meet customer demands by understanding what products are the premium selling products, thereby ensuring that retailers have stock as and when required.

“The Shelfie robot is an innovation developed by Australians that will revolutionise supermarkets ability to forecast stock requirements both in Australia and overseas retailers.”

Microsoft Surface capturing photos for use with Shelfie

Shelfie is a true Australian innovation, with Microsoft engaging Lakeba in June 2016 to develop a concept solving three common retail challenges: in-sufficient stock levels, incorrect product ticketing, and the regular implementation of new store layouts. From these beginnings Shelfie was born, with Lakeba’s dedicated seven-person team working with Sydney-based firms Design + Industry and Marathon Targets on finalising the design and robotics, respectively.

For increased stock visibility and subsequent data analysis to be Shelfie’s market differentiator, Lakeba needed the back-end technology underpinning it to be scalable, able to capture, process, and present visual data, and report in real-time. Equally important was the technology platform aligned with Lakeba’s product roadmap for Shelfie, with plans to integrate supply chain management, and introduce cognitive service to further unlock operational excellence.

“Considering the retail industry’s constant transformation, Shelfie needs to be able to change and grow with it. The breadth of Microsoft’s intelligent cloud applications and services equips us with the capabilities we need to future-proof Shelfie beyond the launch unit,” said Younger.

“Microsoft Azure is the cornerstone of Shelfie, with services such as Active Directory, SQL Database and Content Delivery Network providing automated capabilities  enabling image capturing and data analysis be actioned and presented in real-time. Looking to the future, we’re exploring integration with Microsoft Dynamics 365 to help automate the ordering of stock when levels are low, and investigating the potential of machine learning and cognitive services running in Azure,” Younger add.

The future of the retail industry is more automation – both consumer facing and in day-to-day operations. Shelfie represents an important chapter in this transformation and with its foundations in Microsoft’s trusted cloud – ensuring it can grow with evolving industry trends – retailers can be confident that an investment in the technology is an investment in their current and ongoing success.

Shelfie is currently being showcased at the National Retail Federation’s BIG Show in New York by Microsoft and Lakeba. Interested attendees can visit the Microsoft booth to see Shelfie in action (#2803).

[1] Total Retail Survey 2015. PwC. 2015.

[2] We Lost Australia! Retail’s $1.1 Trillion Inventory Distortion Problem. IHL Group. June 2015