Trax takes digital tools into bricks and mortar stores

Sue Mitchell
July 9, 2019
AFR

Australian grocery retailers may soon be using digital tools such as image recognition and artificial intelligence to boost sales by monitoring supermarket shelves for out-of-stocks and compliance with shelf-space plans.

Trax Retail, a Singapore/Israeli technology company which uses computer vision technology and artificial intelligence to monitor and analyse supermarket shelves, is conducting pilot programs with 25 global retailers, including a major Australian grocery chain.

The retailers are installing hundreds of tiny wireless cameras to monitor shelves across the store and using Trax’s cloud-based image recognition technology to measure factors such as on-shelf availability and compliance with planograms and promotions.

Trax is digitising bricks and mortar stores by using image recognition technology and AI to monitor and analyse products on supermarket shelves.  Supplied

Trax is also working with several Australian food and grocery suppliers, including Coca-Cola Amatil, who are using hand-held devices such as phones and tablets to take images of shelves and using Trax technology to analyse in real time how their products are faring compared with rival brands and checking compliance with planograms, promotions and merchandising.

“Trax is all about digitising the physical world of retail,” says co-founder and chief executive Joel Bar-El, who founded the company nine years ago with Dror Feldheim.

“We have different solutions but all of them rely on computer vision technology where images are taken of shelf space and we identify in real time all the products located on the shelves,” he said.

“Once they identify all the products in the store there are multiple use cases and [ways] to use the data to gain benefits.”

Trax says the technology helps suppliers increase sales and reduce costs by ensuring compliance with commercial terms, such as how much shelf space they are entitled to and where on the shelf their products are placed, and check that price-based promotions are being properly executed.

Coca-Cola Amatil, which has been using Trax tools to do audits in convenience stores and food outlets, increased store-level sales by 5 per cent and gained 1.3 per cent market share within months of implementing Trax.

Trax tools enabled the bottler’s field agents to make changes to ranges within minutes, rather than waiting days for manual audits to be analysed.

“There are thousands of products in every category from hundreds of suppliers – doing it manually is less accurate and takes a long time so costs are high,” said Mr Bar-El.

“With this technology companies can do it a far more cost effective way, [measuring] more KPIs [key performance indicators] than a human can do and getting it in a more accurate way.

“We are identifying about 1 billion SKUs [stock keeping units] a month and digitising 1.5 million stores every month and we have about 5000 classes of algorithms and 100 different KPIs are being measured in real time.”

Mr Bar-El declined to name Trax’s local clients, with the exception of Coca-Cola Amatil, which was one of the firm’s first recurring customers in Australia and features on the Trax website.

He also declined to say whether Trax was conducting the pilot with Woolworths or Coles. Woolworths said it was not involved in the pilot, while Coles, which this week signed a long-term strategic partnership with Microsoft, said it had spoken to Trax in the past but was not currently working with them.

Global clients include Coca-Cola, Nestle, AB InBev, Diageo, Molson Coors, Heineken and Mars and international retailers Tesco, Carrefour and Shufersal.

The company has raised $US250 million ($360 million) from investors including Warburg Pincus and the Singapore government and is planning an initial public offering, most likely in the US, in 12 to 18 months.

Trax also plans to open an office in Australia to better serve its growing list of customers.

Mr Bar-El said retailers were not worried suppliers were using Trax tools to level the playing field and check they were getting what they paid for in terms of shelf space and promotions.

“Retailers and suppliers have some conflicts of interest but mostly they are collaborating – they’re servicing the same client base, they’re all trying to sell their goods in a better way and create a better experience, so for the most part I think they see eye to eye,” he said.