clock menu more-arrow no yes

Filed under:

7-Eleven adopting wireless computer technology

ROCKWALL, Texas — Sherry Neal walked over to the refrigerated shelves of her 7-Eleven store, consulted a small handheld computer and instantly got everything she wanted to know about her store's supply of turkey sandwiches.

With a couple of taps on the wireless device, the store manager placed an order for the next day's sandwiches without ever leaving the aisle.

Neal is helping test a wireless NEC Corp. computer that 7-Eleven — the nation's largest convenience-store chain — has put in the hands of supervisors in 10 Dallas-area stores with an eye toward outfitting all its 5,300 U.S. locations next year.

Officials say the devices will reduce excess inventory and dramatically boost sales by eliminating one of retailing's oldest curses: running out of hot-selling items.

Retailers in general and convenience stores in particular have been slow to adopt new technology, analysts say. They depend so heavily on vendors of soda, cigarettes and chips for stocking that they often don't know which items sell best in their own stores.

Now, prompted by the example of Wal-Mart Stores Inc. and helped by the falling price of technology, they are playing catch-up.

"Retailers are trying to get back to where they were in 1905," said Cathy Hotka, a retail consultant in Arlington, Va. "Back then they knew you, knew your credit, knew what you wanted to buy and how to stock it."

The latest demand for right-now information is driving Wal-Mart and Target Corp. to push suppliers to put radio-frequency identification tags — a kind of souped-up bar code — on case and pallet shipments. Stores routinely use software that tells them the optimal price for each product they sell.

Many retailers already use point-of-sale technology that automatically deducts items scanned at the checkout counter from the inventory. 7-Eleven officials believe the handheld computer takes that process one step further.

The NEC device is loaded with software that helps managers predict demand for perishable food — from hot dogs to whipping cream — by taking factors such as the weather forecast into account. Hot weather helps Slurpee sales. Rain is a killer.

Striking the right balance between supply and demand is critical in the thin-margin world of food stores. A widely quoted 2002 study by Emory University estimated that stores lose 4 percent of potential sales because they run out of items customers want.

Neal, the 7-Eleven manager in Rockwall, used the machine to get an instant recommendation of how many bags of potato chips to order for delivery overnight. She could go along with the computer's suggestion or override it.

"It brings the computer out here on the floor," Neal said, adding that it is light years removed from the ordering system in place when she started working at 7-Elevens in 1979.

In those days, she carried a big book around the store and wrote how many of each item remained and how many to order. She would tear out a perforated piece of paper for each one, and hand the stack to her supervisor. The slips would be used to fill orders at a local warehouse.

Dallas-based 7-Eleven borrows many ideas about technology from Japan, where parent company Ito-Yokado Co. — which owns 73 percent of 7-Eleven stock — also operates as its licensee. 7-Eleven stores in Japan have used a rudimentary version of the handheld computers for several years, although they aren't wireless.