Everseen, the retail security AI company, has secured funding from MARCOL and other investors, to tackle the growing problem of product loss and shrinkage in the global retail industry.
Everseen uses advanced video analysis and artificial intelligence to reduce non-scans at the checkout by up to 90 per cent, a problem that costs retailers USD40 billion a year globally according to the Centre for Retail Research.
When goods are not scanned at the checkout, retailers’ supply chain systems do not see that a particular item has left the inventory. It’s only when stock checks happen that this loss is discovered. By then, it’s too late to see where it occurred and retailers have mistakenly assumed this loss is through customers or staff stealing from the shelves. UK and US retailers alone invested $15bn in 2014 in measures to deter theft in-store (outside of the checkout) but some of this investment is misplaced.
“Retailers are losing $40bn a year through shrinkage at the point of sale. Products non-scanned are not only impacting profits but also creating supply chain issues leading to out-of-stock products. Non-scans can be intentional or unintentional and are generated by customers, employees through operational errors and process non-compliance,” said Professor Joshua Bamfield from the independent research group, Centre for Retail Research. “At the moment, retailers are almost certainly haemorrhaging revenue through their POS and are probably completely unaware of how it is happening, how they prevent it and the scale of the problem.”
Everseen, which works with five of the top 10 global retailers, has proven that 95 per cent of the issues at the checkout are non-scans. The problem is more acute at self-scan checkouts with up to 10 times more non-scans when compared to manned checkouts. The company estimates that 90 per cent of all non-scans at the checkout can be identified by using its video analysis and artificial intelligence system approach. By visually recognising such events using existing CCTV feeds and linking them to checkout transaction data, Everseen can identify precisely when, where and why the activity took place. A video of the incident can then be shared with store staff in real-time.
Current measures to prevent non-scanning are rudimentary at best, with CCTV systems only being checked when suspicions are raised, which means the bulk of non-scanning activity is missed. By some estimates only 5 per cent of irregular activity at the checkout is captured through traditional point of sale analysis systems.
“The majority of retailers simply don’t know where these losses are coming from. Because of this they’re acting blind – trying to prevent losses but without any real direction. By understanding how these losses are occurring, and how to prevent them, retailers can improve their profits by 5-15 per cent,” says Alan O’Herlihy, founder and chief executive, Everseen. “We’ve spent a number of years developing the technology and uncovering what is tantamount to the DNA of a non-scanning event. With growing interest from retailers across the globe, over the next few months we are looking to partner with leading IT companies to service our retail customers worldwide. This investment and MARCOL’s resources and support in general will help us accelerate our global expansion.”
“In today’s highly competitive world, profit margins in the retail industry are tight and shrinkage is a serious problem,” says Pii Ketvel, CEO MARCOL Capital Europe, who led the MARCOL investment. “For retailers, this solution can have an immediate, positive uplift on profitability. Our due diligence has shown that this solution has the potential to completely transform the market. Everseen allows retailers to move more quickly to self-service check-outs by making the user experience better, whilst helping the retailers to reduce their losses. By combining Everseen’s very impressive technology with MARCOL’s financial and other resources, we’re giving Everseen the tools necessary to bring this remarkable technology to a global audience and to change the face of retailing.
