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Report: Supermarkets to Spend Big on Self-Checkout, POS, and Mobile

FRANKLIN, Tenn. - Supermarkets with annual sales of more than $1 billion are going to be spending heavily in the next two years on new point-of-sale hardware, self-checkout systems. and a new class of retail mobile devices, according to a new report from IHL Consulting Group, a leading retail analyst and consultancy firm.

"Retailers have been delaying store-level technology purchases for the last three years," said IHL president Greg Buzek. "A great deal of this equipment is now is 12 to 14 years old. There still remain more than 200,000 POS terminals installed in North American supermarkets that are running x286- and x386-class processors. The point has come where retailers are being forced to replace their equipment and plan to do so at an accelerated pace."

Released today, the 113-page report, "IT and the North American Supermarket," reveals how technology can be used to meet the challenges currently facing grocers. Some of the report's findings include:

- Between 25 percent and 40 percent of transactions now take place via self-checkout systems in the stores that use them.

- Self-checkout systems continue to grow in interest among retailers that currently use IBM POS terminals, which represent approximately 70 percent of retailers with more than $1 billion in sales. IBM's recent purchase of Productivity Solutions, Inc. should help spur continued growth of the technology.

- A new class of retail mobile devices that offers integrated, real-time information exchange with in-store POS systems is of high interest to retailers. These devices allow store managers to perform functions traditionally handled from a desk on a mobile device as they walk the floor interacting with employees and customers.

- The top 30 percent of customers account for 75 percent or more of grocery sales. The bottom 30 percent of customers account for just 3 percent of sales.

- Wal-Mart, Kroger, Safeway, Albertsons, and Ahold USA are North America's top five supermarkets, representing over $180 billion in grocery sales each year.

The report also includes detailed technical summaries of the top 20 retailers. Summaries include retailer competitive comparisons and specific technologies, including hardware, software, commerce, data warehouse, distribution and supply chain, financial, head office, knowledge management, sales, and service.

"These technical profiles on each retailer provide a wealth of information for analysts, vendors, and other retailers," Buzek said. "Each profile reviews the financial performance of each retailer against their competition, as well as the hardware and software systems that they use to maintain and increase that performance."
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