Samuel Mueller, CEO & Cofounder at Scandit.
Retailers across the globe are hemorrhaging revenue due to inventory distortion. In fact, the IHL Group—a research and advisory firm specializing in retail—notes the industry loses a staggering $1.7 trillion annually because of stock mismanagement. A striking 67.5% of these losses stem from out-of-stocks, while 32.5% come from overstocks. But this issue isn’t just about numbers—it’s about lost sales, customer dissatisfaction and operational inefficiencies.
Nowhere is the problem more acute than in grocery retail. With thousands of stock-keeping units (SKUs) moving at breakneck speed, grocers struggle with limited visibility into what’s happening on their shelves. They know what arrives at the store and what leaves through the checkout, but what happens in between remains largely a mystery due to theft, misplacement and other factors.
For decades, retailers have relied on manual stock checks by store associates to identify empty shelves or misplaced products. But these outdated methods are a slow and difficult way to capture this information—no match for today’s fast-paced grocery environment. Customers demand seamless shopping experiences, and every empty placement is a missed sales opportunity.
Worse still, 30% of U.S. consumers who experience regular out-of-stocks at a grocer say they would question their loyalty to that chain, according to Retail Insights. That’s a major blow to both sales and long-term customer loyalty. Additionally, frequent stockouts force customers to shop elsewhere, chipping away at repeat business and undermining brand trust.
One solution is real-time shelf intelligence that provides store associates with actionable insights into on-shelf availability, helping them replenish shelves faster, reduce lost sales and boost customer loyalty.
The Advantages Of Smarter Shelf Management
Through AI-powered product recognition and machine learning, store associates can receive automated, prioritized alerts directly on their handheld smart devices. These real-time insights enable them to restock shelves faster, minimize out-of-stock scenarios and maintain inventory accuracy. Empowering store associates with actionable insights is a key benefit of shelf intelligence solutions.
Instead of spending hours manually checking shelves, employees can focus on high-value tasks like customer engagement. Real-time alerts, with high accuracy levels, ensure they can reorder inventory and prevent stockouts before they occur—without the need for guesswork or unnecessary manual audits.
A well-stocked, well-managed shelf improves the shopper experience, reduces frustration and increases customer loyalty, while grocers have seen sales uplifts of up to 2.5%, according to our experiences with customers. This is significant, especially given their scale and razor-thin margins.
Empowering store associates with such actionable insights relies on having a smart data capture strategy in place and equipping them with either smartphones or handheld computers, which already exist in most grocers’ technology infrastructure. This enables them to ensure that the right products, shelf modules and aisles are monitored at the right frequency and precision.
However, to unlock further efficiency and automation benefits that can contribute to retailers seeing on-shelf availability accuracy levels exceed 95%, fixed cameras and robots can be used in conjunction. This combination, or hybrid data capture approach, brings amplified benefits in a cost-effective manner.
The Route To Adoption: Embracing Hybrid Data Capture
For many retailers, transitioning from manual stock checks to AI-powered shelf intelligence may seem daunting. But the shift doesn’t need to happen overnight. A phased approach allows grocers to test and scale their solutions while maximizing ROI and avoiding any unnecessary risk.
Leveraging mobile data capture on existing devices is a low-stakes first step that immediately provides better shelf visibility—without the need for significant upfront investment. Once retailers see the benefits of mobile data capture, they can explore further automation.
Where higher frequency updates are required, automation can be increased via fixed cameras or autonomous robots to provide continuous monitoring, flagging stockouts or pricing discrepancies before they impact sales. These solutions ensure that even the busiest store sections remain well-stocked and operationally efficient without adding to employee workload.
Smaller store formats can see significant improvements using mobile data capture alone, while larger ones may choose to combine mobile, fixed and robotic solutions to cover all SKUs efficiently and avoid labor-intensive manual processes. This flexible approach ensures that the technology investment is aligned with the size of operations, ensuring scalability without unnecessary costs.
This gradual and practical route to adoption ensures that retailers can transition to AI-powered shelf intelligence without disrupting existing store operations. By starting small and scaling over time, grocers can maximize ROI and drive long-term efficiency gains.
The Role Of AI-Powered Shelf Intelligence In The Future
The debate is no longer about whether grocery retailers need better inventory visibility; it’s about how quickly they can implement it.
Retailers that continue relying on manual stock checks risk falling behind. Real-time, AI-powered solutions are now readily available, allowing grocers to automate shelf management, reduce inefficiencies and enhance customer experiences. With this kind of enhanced efficiency, smart data capture technology eliminates the guesswork, allowing employees to focus on strategic, high-value tasks instead of wasting time on manual checks.
A hybrid approach—combining mobile data capture with fixed cameras and autonomous robotics—enables the flexibility to be tailored to any store format and size. Ultimately, shelf intelligence isn’t just about keeping products in stock; it’s about unlocking revenue potential, improving fulfillment accuracy and ensuring long-term profitability.
The retailers that embrace this transformation today will be the ones who can sleep easily knowing they have a solution to tackle the inventory distortion nightmare and that they’re maximizing that oh-so-valuable shelf real estate to the best of their ability.
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