Case Studies – ASDA

VMC has earned praise from retail giant Asda as a major store roll-out programme nears completion.

ASDA, the UK's number two supermarket retailer, relies on an army of over 130,000 colleagues to maintain its position at the forefront of the UK's highly competitive supermarket industry based on an ethos of quality, value, convenience and service.

It's an environment where innovation and product development flourish – you don't become part of the largest retailer in the world by chance.

When ASDA's UK management team decided to upgrade their cashless technology facilities used by colleagues to make all on-site food and refreshment purchases - it was a mammoth task which required careful consideration and an in-depth market analysis.

ASDA, “Britain's best value retailer*”, became part of the Wal-Mart family in June 1999 and has 265 stores and over 20 distribution depots across the UK - so any fundamental changes have an obvious big impact.

ASDA colleagues use cashless card technology to make purchases in their restaurants and at vending machines with an innovative system from VMC now installed at the majority of sites, as part of an on-going roll-out programme.

Head of ASDA's Commercial Department, Jim Murphy, played an instrumental role in introducing the VMC technology which first went live in September 2002, following almost a year of background research and an extensive tender process.

“It was my role to identify a supplier and the suitable equipment. The main reason for changing from the previous system - from a different manufacturer - was that it was up to seven years old and we felt it was time for a more modern approach.”

“There was a thorough tender process and various reviews which took almost a year to complete. Due to the complexity of the product there was quite a lot to check out and essentially it was vital we made the correct decision. We had to get it right.”

Colleagues load a cash value onto their cards to build up an ‘electronic purse’ to make purchases and since the VMC system was launched, vending machine downtime has been reduced significantly because the new technology by definition is more reliable and also there is a quick-fix solution if a card reader develops a problem.

Jim explained: The thing that switched me onto VMC was that I could see a big reduction in maintenance costs. We can pull out a card reader and replace it in minutes if a problem occurs. Therefore downtime is kept to an absolute minimum. The previous process involved sending an engineer out which would normally take hours, not minutes.

“Now the reader can be replaced extremely quickly which is vital for stores and depots which trade 24 hours a day. It really comes into its own when the hot food restaurant service has closed through the night.”

He declared: “We really liked the plug and play concept and could see the immediate advantages. The other main attraction about VMC was that whatever problems and issues we threw at them, each time their technical guys came back with innovative solutions.”

Although the VMC system may appear complex, it is very easy to use, reliable and offers great potential for future developments. A touch pad catering till system, which is easy to clean and change prices - and different from customer restaurants - also earned Jim's praise.

“Even if a catering till goes down you can use a separate mini till which can be taken from back of house so there is flexibility and a contingency plan in place,” he explained.

“This is an extra benefit which VMC introduced. It is vital in keeping the catering operation going even if a till goes down. VMC is solution focused and this was very apparent throughout the tender process. They view problems as opportunities.”

A trial of the equipment took place at Sutton in Ashfield and was judged a resounding success.

“The site was chosen as part of a store adopter programme - this was my adopted store, so it made sense to start off there. I wanted to make sure that VMC would deliver what they said they would. The trial lasted about eight weeks and after just a couple of weeks I knew the system was going to be right for us. There were no real issues.”

Jim continued: “As well as assessing the new technology it was important for us to discover how well VMC could work with our vending operator of eight years and they were also very positive about the company. For me, I wanted one point of contact and that has now been achieved, if a problem occurs it is dealt with efficiently and very cost effectively.”

“The readers really grab hold of the cards and appear to register the values much better. Our sites are nationwide and have local delicacies. What we needed was a flexible system which we feel we now have.”

ASDA's Colleague Catering Manager, Iain Widlöf, says the new system provides the ideal platform to run each site much more efficiently.

“We are looking to exploit the system's potential, particularly on the data management and back of house side of things to provide more central visibility and control. For example, a lot of our product is bought from the shop floor which potentially can leave gaps in supply. By introducing VMC's EPoS system, forward planning will be much easier. The platform is in place to glean more information to run the business more efficiently.” All colleagues carry a card which is combined with access control. Some sites have integrated a time and attendance function whilst several depots also use the cards to operate fork lift trucks. Warwickshire-based VMC has also developed a photo id system which has been introduced at a couple of locations.

Colleagues benefit from a subsidised meal and refreshment service as part of a high priority colleague benefits package.

“It is a very heavily subsidised service, the most heavily subsidised of any supermarket chain that I am aware of. An army marches on its stomach and it is very important for us to provide colleagues with a high quality, modern and efficient meal and refreshment service,” said Iain. The VMC system also provides the ability for visitors to be issued with their own dedicated cards which operate on higher priced tariffs.

Whilst system reliability is described as 'very good' it is staff training where VMC really shines.

Jim revealed: “The feedback from the colleagues was very positive about the VMC training. Understandably there was a little apprehension at first, a bit of the fear of the unknown, but the thorough training was very beneficial and after a couple of days people were using the system as if they had been doing so for years.”

ASDA have found training manuals very helpful, and the company is in the process of developing an intranet version, from its UK headquarters in Leeds, for even more ease of use.

Overall both Jim and Iain are delighted by VMC as a company and its products and services. Jim concluded: “We have found VMC to be both understanding and flexible. It is very reassuring to know you are dealing with a company that really cares about its customers. I am very happy with VMC but the real proof is the store feedback which has been equally impressive.”

* Grocer 33 - weekly survey of price baskets of all main supermarket retailers, has named ASDA as Britain's best value supermarket for the last 7 years.

This case study is available for download (PDF)