What facilities service providers can learn from retail point-of-sale

The barcode transformed retail point-of-sale 45 years ago

The very first UPC barcode scan, in June 1974, made at a checkout counter of Marsh’s Supermarket in the town of Troy, Ohio, changed the retail point of sale forever.  Barcodes have reduced costs, lowered prices, improved inventory management and boosted operational efficiency across the ($23 Trillion global) retail industry, giving those that adopted technology early a clear competitive advantage in the market.

Source: 123RF.com

At this retail checkout, waving a box of corn flakes above the laser scanner bed records a product purchase transaction in less than a second, by reading a  barcode printed on the bottom of the box.

The barcode scanner captures product and price details allowing systems to update inventory, capture product/customer purchase history, and account for revenues and costs within financial reporting system.    Prior to scanner technology, the cashier would manually enter only the purchase price of each item at the cash register, leaving store owner without the data required to manage product sales or inventory information.

Within a few years barcodes were rapidly adopted, with 30% of retailers implementing within ten years.  Today digital checkouts and scanners are ubiquitous?

How much productivity gain for retailers?

Source: Wikipedia

In Raising the Barcode Scanner: Technology and Productivity in the Retail Sector, Emel Basker found an average of 4.5% annual productivity improvement from using the barcode scanner at the point of sale.  Larger stores gained more, and entry/exits in the industry skewed the results towards those that adopt.  Retail payroll is about 30% of retail income so this equates to about $310 Billion in annual savings across the entire retail sector (including non-adopters).

These efficiency gains, went far beyond a relatively modest productivity gain at the point of sale when the enabling POS technology also integrated systems across the supply chain.   The result, technology enabled innovators like Amazon and Walmart to digitize their supply chains, more effectively manage inventory, drive down operating and administrative costs, push down consumer prices, grab market share and rapidly increase revenues, all based on a small striped rectangle printed on every product.

Photo: R.Rolston

Why facilities service providers should adopt similar technology now

In contrast to retail, today construction and facilities services (a $14 Trillion global industry) remains almost entirely offline…without digital supply chains or any direct digital connection at the point of service, between the service provider and  end-customer.

Like the pre-scanner days in retail, service transactions in facilities services exchange minimal data, little more than the total invoice cost.   To achieve similar operational efficiency improvement across facilities, these point-of-service processes must change.

Mobile scanners now available for everybody

Only in the past ten years have mobile scanners arrived on every smart phone, making field service scanning more affordable and practical than expensive retail POS scanners.   Whereas the cost of retail POS provided advantage to large enterprises,  now mobile technology levels the playing field, available to both large and small facilities operators and service providers.

Many specialized services (HVAC, electrical, plumbing, security, automation, cleaning, landscaping, IT, etc.), including entirely new specialties to manage technology in buildings, have created the need for collaboration across the entire facilities supply and service chain.   A shared (by invitation) QR code provides access to a common digital asset service record and documentation for each asset.

Facilities stakeholders working together within an online digital ecosystem will generate significant savings.  Using retail’s 4.5% estimated techno-productivity gain, this will be at least $315 billion on the table within the global construction & facilities sector, possibly a lot more…

Productivity gains of 30-50% or more available to innovators

In facility services, the barcode (now a modern QR code) tags  the equipment or space (connecting the point-of-service) to access the asset’s “digital twin”, a storage and workspace for all documents and data related to the asset.  Scanning the QR allows the user to identify safety hazards and discover operational procedures for the equipment and related  systems.   Integrated service procedures provide accurate, repeatable real-time condition and cost data as the technician steps away from each asset.

At BuiltSpace we’ve seen up to 70% measurable improvement in productivity, over traditional paper work orders, for a number of common use cases, especially in areas like safety compliance and preventative maintenance inspections.

Help us make the global built environment more sustainable