A source of improved profits

Of the many technological developments offering benefits to FMCG companies and retailers, one practice proving particularly key is source tagging.

Put simply, source tagging involves security tags being applied to a product’s packaging during the manufacturing process. The advantages this offers retailers are less easily summarised, extending to everything from an improved shopper experience to increased security.

Firstly, source tagging improves efficiency in a way that can enhance customer service and boost profits. Because items arrive shelf-ready, store staff are able to spend time serving customers rather than applying labels to items. For today’s time-poor consumer, having a readily available member of staff offering assistance is crucial. If staff members are unable to offer assistance because they’re busy applying security tags, there’s ever chance this will result in lost sales.

Additionally, source tagging is important from a branding perspective, helping to ensure labels are placed in the correct place on products. The importance of this can’t be overstated – the reason significant sums are invested in packaging design is because effective branding is a strong driver of profits. Source tagging can help ensure an expensive pack design isn’t obscured as a result of a misplaced label. It also helps guard against misplaced label obscuring allergy warnings, which could result in legal ramifications.

Taking all of this into consideration, it shouldn’t be a surprise that source tagging has been shown to increase sales by up to 30 per cent and reduce shrinkage by more than 60 per cent.

If, as these figures suggest, source tagging proves vitally important to retailers, some credit should also be given to complementary developments, including more advanced labels and alarm technology. For instance, 3-Alarm technology notifies staff when an item is being tampered with, sets off store alarms if a tagged item is stolen and sounds an alarm on the tag itself if the item leaves the store.

Such developments present retailers with the opportunity to make complete 360º improvements – from the efficiency of their tagging process to the effectiveness of the tags themselves.

Improving security, efficiency, product display and customer service can have a significant impact on profits – there’s little doubt that real gains can be made through adopting advanced tagging technology.