March 16, 2003

Eldat has developed an infrared two-way remote electronic shelf label communications system, which includes a processor, and liquid crystal display. The bane of any supermarket worker or manager is the repetitive task of updating sticker prices on shelves.

More than 20 years ago, experts predicted that supermarkets and other stores would be soon be changing radically. Instead of the tedious and arduous manual chore, they said, every product on display would have ESLs – Electronic Shelf Labels that could be updated with the touch of a button.

It has taken much longer than expected for this technology to become more widespread. Until a few years ago, the high cost prevented their being distributed to stores. Today new wireless communications developments, combined with the ability to link the communications chips to store databases and software have helped ESL gain popularity and may soon make them affordable enough for widespread use in the U.S. market.

An Israeli company, Eldat Communication is the leading company in the retail market, for ESL (Electronic Shelf Labels). With over 3,500,000 labels sold to leading chains in Europe and Japan, Eldat is one of the fastest growing companies in the Retail Market.

Eldat has developed a hi-tech infrared two-way remote electronic shelf label communications system, which includes a processor, and liquid crystal display. Wireless transmitters in the store’s ceiling make it possible to automatically update the prices displayed on the tags through wireless transmission.

The prices can also be updated on “smart tags” placed on each individual product, completely eliminating the need for bar codes. The electronic wizardry also provides storeowners to obtain an immediate update when products are sold (taken out of the store), so they can replace their inventory.

The Eldat technology is grabbing hold in Europe and heading to the United States. The price of an individual tag has fallen from $12 five years ago to about $5-6 at present. Managers at major US stores estimate that a $2-3 price will constitute a real incentive for retail chains to adopt this technology, since at that price, the return on investment in the systems will come quickly.

Last month, Eldat signed an agreement to supply electronic price tags to French supermarket chain Casino. Casino is one of the largest marketing chains in Europe, with 115 hypermarkets and 433 supermarkets in France, and over 1,000 stores in the U.S., Poland, South American, Taiwan and Thailand.

The value of the contract, Eldat’s largest since the company was founded in 1994, is estimated at over $12 million, Eldat is scheduled to supply two million price tags by June of this year. In South-Eastern France, an entire region of another 34-branch supermarket chain, Lecasud, has committed to the system.

“During the past few months, our presence in the French market is getting more dominant” said Yossi Smoler, Eldat’s president and CEO. “The independent retailers understand that what is being selected by the leading integrated chains will be a good choice for them as well, and are willing to pay a small premium for a better solution.”

When European countries switched to the Euro currency last year, the stores with the ESL system in place made the switch easily. In Portugal, the Jeronimo Martins chain converted more than one million labels to the Euro in its 130 stores remotely from the company’s head office in Lisbon. The entire process took less than five hours.

“We are impressed with these performances” said Jose Silva Ferreira, JMR’s Director of Information. “In stores that do not have ESL yet this conversion was a tough task that involves a lot of preparations and manpower.”

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Jason Harris

Jason Harris

Executive Director