NRF 2017 Wrap Up: Augmented Reality In The Supply Chain

There were plenty of supply chain-centric solutions that caught our eye at the recently wrapped NRF (National Retail Federation) BIG Show in NYC, and a couple of them hold the potential to transform the way omni-channel merchants execute their fulfillment strategies.

Two of the more interesting technologies that are poised for penetration are virtual reality (VR) and augmented reality (AR). Bolstered by consumer-facing gaming applications, VR and AR are making their way into retail to support the concept of “experiential” retailing. Consumers are encouraged to don VR headsets, for instance, to experience merchandise in the context of its intended use—to envision a certain piece of furniture in their own living room, or feel the action of a new fishing rod in a more lifelike fishing situation than a store aisle, for instance.

While these consumer-facing applications for VR are exciting, their developers aren’t quite ready to stake any claims to the topline sales benefit they might drive. They don’t, therefore, have any immediate, measurable impact on the supply chain.

Augmented reality, well that’s a different story. Multiple solution providers—from little-known startups to enterprise-class software providers like SAS and Intel—were demonstrating AR solutions geared not toward a snazzy in-store experience for consumers, but an optimized back-office experience for line-of-business managers. Many of those AR solutions offer the potential to drive measurable efficiency gains in DC and supply chain operations. Combined with product tracking technologies (i.e. UPC codes, RFID tags) and analytics software, store managers and merchandisers can, for instance, walk store floors and make hands-free reorder, merchandising, and allocation decisions that directly impact the upstream supply chain.

More close to home, AR holds great potential to penetrate the DC itself as an order picking enabler. With an AR headset, DC operations associates can work through a pick list seen on a heads-up display while maintaining full use of both hands. In goods-to-person environments, such a display might offer directions in a more efficient and ergonomic manner than a traditional workstation. That same headset might read bar codes and/or RFID tags to record and validate the movement of merchandise, automating a previously manual task.

Investment in AR and VR is scorching hot right now. CB Insights reports that 126 AR/VR equity financing deals in 2015 raised $658 million for AR/VR startups. Goldman Sachs has gone so far as to state the combined technologies hold the potential to top the annual revenue of the TV market by 2025. But while those early predictions are banking on consumer adoption of the technologies, emerging business benefits might just give the technologies an unexpected shot in the arm.
 

Our team of project managers, engineers, and analysts can assist and support you through your DC automation evaluation and implementation process from start to finish. Contact us today via phone (+1 856.727.1100) or online to learn more.   

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