How much do Electronic Shelf Labels cost?
This is one of the first questions most interested retailers ask themselves as they begin to explore whether electronic pricing is the right investment for them. There are several factors which will influence the required investment of an electronic pricing system, in this article I will break them down to give you a better indication of costing and how you can save money along the way.
Electronic price tag options
Sizes: Generally speaking, the larger the label the more expensive the investment. A good way to work out which size you need is to tell your provider what information you require on the label (e.g. price, product information, barcode etc..); the last thing that you want to do is have a label so small that customers cannot read the information. It is also worth clarifying the type of products you sell, and the size of their product facing. If they are in a densely packed area (e.g. spices in a supermarket), larger labels will not be feasible. One option that many customers are choosing in these scenarios, is to split the screen on a larger label, this can halve the number of labels required for a store, saving costs and space.
Size S, M, L and XXL epaper electronic shelf labels in both black/white and red/black/white.
Colours: Newer labels allow for red or yellow to be added to standard black and white screens. Whilst red is great at allowing specials to stand out, it does increase the cost slightly. It is important to ask yourself why the labels are right for your business. If you’re simply looking to maintain product margins and decrease operational costs, black and white labels may be the solution for you, but if promotions, discounts and/or bulk buys are key to your pricing strategy, then colour labels would be the way to go.
The technology in the label: Older LCD or e-paper labels might be cheaper initially for retailers interested in electronic shelf labels. One must be very careful however, when choosing to move ahead with a cheaper label, after all, they are cheaper for a reason. Cheaper labels are generally less reliable. My advice would be to choose between a reliable proven technology or sticking with an existing paper price system; instead of moving ahead with a cheaper electronic pricing system. Ensure that any investment you make comes with a one-year warranty, this is the best way to protect yourself.
Even if the technology is reliable, cheaper labels often lose functionality which might be important for your business. For example, a label not having the ability to produce a barcode on the screen, means that you have to manually print off paper barcodes to stick onto the labels; or enter in the product ID every time you want to match an electronic shelf label with a given product.
Quantity: Like with most investments, the higher the quantity the lower the price per label. One approach that works for most retailers is to pilot the technology in one store (or part of a store if you have a lot of SKUs), then if successful, purchase electronic shelf labels for the remaining stores in one order.
Fixing attachments
A crucial part of the process, getting the labels connected to a shop’s shelving system. A general rule is the more custom the fitting, the more expensive the attachments. Attachments will generally cost 5-10% of the value of the electronic shelf labels.
Different fixing attachments and accessories - electronic shelf label holder, clamp and waterproof casing.
Integration
Connecting the electronic shelf labels to your pricing system. The most cost-effective way to do this is to involve your IT department early in the process. Get them to work with your supplier’s IT team to figure out exactly what needs to be done to integrate the systems. That way, there will be no unexpected surprises once your sleek new system is installed.
Installation
If you have handy people in your team, you may be able to do a lot of the installation yourselves. About 30% of our clients choose to self-install. Depending on the complexity of your installation, this may be a great way to save money on your electronic shelf label system. If you pay for installation, most suppliers will charge per hour; meaning that the bigger the shop, the higher the costs.
Tax rebates
Electronic shelf labels are eligible for the new coronavirus government stimulus aimed at encouraging businesses to continue to invest. Tax rebates mean many businesses could take 27.5% off their initial investment from day 1. Check with your accountant for more details.
In summary: Electronic shelf labels can transform a business. Be sure to consider all the advantages that the new system can bring and balance that with the cash outlay. Shelf labels can be added onto a company’s asset sheet, making it more attractive to potential buyers if a business decides to sell. So, whilst there are many ways you can save money on a system, do not risk-taking shortcuts which will prevent your business from enjoying the new system’s key advantages.
Author: Lyall Sundel, Head of Customer Success
