Omron and Watts to Promote Advanced Store Layouts

Omron Corporation (Headquarters: Shimogyo-ku, Kyoto; President and CEO: Shunta Tsuji, hereinafter Omron) has, as part of its data service business "M&S Business," a focus area in the mid-term roadmap "SF 2nd Stage" of its long-term vision "SF2030," commenced a joint initiative with Watts Co., Ltd. (Headquarters: Osaka City; President and CEO: Fumio Hiraoka, hereinafter Watts) to advance in-store store layout optimization through data utilization in chain stores.

This initiative aims to maximize sales opportunities and increase revenue by classifying stores into multiple types based on differences in location, scale, and customer demographics, and then implementing product compositions and store layouts tailored to each type's characteristics.

Background and Objectives

In recent years, the retail industry has faced challenges such as labor shortages and an increase in the number of stores, making it difficult to secure sufficient resources for revising store layouts and product compositions according to the situation of each store. As a result, there are cases where potential sales opportunities are not fully leveraged, hindering sales expansion. Furthermore, while data utilization is crucial for streamlining store operations, in franchise-style stores, detailed data such as sales by store section and product often remains at the individual store level. Headquarters cannot grasp this data, leading to stockouts of popular items and overstocking of unsold goods. Consequently, many operations are not yet fully optimizing ordering and streamlining store operations based on data.

In light of this situation, this initiative will leverage the insights and technologies in data analysis held by JMDC Inc., an Omron group company, to visualize store-specific characteristics and sales trends that are not fully understood by headquarters, and to improve store sales by designing optimal product compositions and operational rules for each store.

Initiative Details

This initiative aims to establish a system that can continuously implement store measures leading to sales expansion, even in environments where data such as sales and inventory levels are difficult for headquarters to grasp centrally.

Utilizing AI based on diverse store data such as location conditions and a store characteristic diagnostic questionnaire designed by Omron to classify stores into multiple types.

Predicting the expected sales for each product by store type and visualizing these trends.

Designing product lineups suitable for each store type and deploying them to the field in a way that can be seamlessly integrated into conventional ordering processes.

Designing store layouts to maximize the potential sales for each store.

This will enable the creation of store layouts that leverage the sales characteristics of each store, even in locations with data acquisition constraints.

Roles of Each Company

Watts Co., Ltd.

Providing operational knowledge regarding in-store sales operations and product composition.

Practical classification and concretization of product composition and operational rules based on store types.

On-site implementation, verification, and sales-oriented improvements.

Omron Corporation

Designing analytical methods applicable even in environments with limited data, and designing store type classification logic.

Designing product compositions and operational rules that lead to sales expansion, and supporting the establishment of reproducible operational methods in the field.

Supporting operational design with a view to continuous improvement and company-wide deployment.

Future Outlook

Omron is strengthening investment in 13 focus businesses that will drive future growth through portfolio restructuring, as outlined in the mid-term roadmap "SF 2nd Stage" of its long-term vision "SF2030." This initiative is positioned as one of the efforts within the data service business. In the data service business, Omron aims to create new value that contributes to solving customer issues by leveraging the diverse data and on-site knowledge accumulated through its various businesses. This initiative serves as a concrete implementation example of optimizing store operations through data utilization in the retail industry. Moving forward, based on the data and insights gained through this initiative, both companies will further promote the advancement of product composition and store layout creation, explore the possibility of expansion to other store and sales format types, and aim to expand the value of the data service business.

<Related Links>

Mid-term Roadmap SF 2nd Stage https://www.omron.com/jp/ja/vision/sf2ndstage/

Omron Smart M&S Business Division https://datasolutions.omron.com/jp/ja/business/sms/

Watts Co., Ltd. https://www.watts-jp.com/

<About Omron Corporation>

Omron Corporation is a leading company in automation centered on its proprietary "Sensing & Control + Think" technology, developing control equipment, healthcare, social systems, electronic components, and a data service business utilizing the diverse data acquired through these businesses. Founded in 1933, Omron currently employs approximately 26,000 employees worldwide and provides products and services in over 130 countries, contributing to the creation of a better society. For more details, please visit https://www.omron.com/jp/ja/.