J2 Retail Systems Limited is a leading specialist manufacturer of integrated PC-based touchscreen point-of-sale hardware to the retail, hospitality and leisure industries. Through the control of its own design and manufacture, J2 is building an unrivalled reputation for innovation, reliability and low cost of ownership. To find out how, The Grocery Trader spoke to J2’s Moray Boyd (Managing Director) and Richard Heitmann (UK Sales Director).
J2 has turned the manufacture of retail IT technology on its head over the past eight years, as Moray Boyd explains: “The success of our unique products is due to a highly-creative new product development strategy. Larger corporates such as IBM and Toshiba TEC perpetuate the traditional product-oriented approach to manufacture in so much as they design and build terminals and take them to market, resulting in a largely undifferentiated product range across the board. At J2, we think differently and our product development strategy is a complete reversal of the old approach. Our in-house design team begins in collaboration with customers, investigating emerging technologies to find innovative solutions, resulting in a unique product range designed to satisfy industry-specific needs.
Richard Heitmann adds: “This strategy gives us the opportunity to work with talented IT professionals across a range of specific industries. For example, in a recent project with Greggs PLC, the UK’s leading retail baker, Greggs identified the requirement for a Solid State terminal to provide increased reliability and reduce the cost of ownership. By combining J2’s technical ability and Greggs’ retail experience, our designers were able to develop a new style of fully Solid State point-of-sale terminal using compact flash cards. To reduce deployment costs, the units were built to enable Greggs to fit the new terminal onto existing counter brackets”.
Vue Entertainment, one of the UK’s leading cinema chains, is another J2 customer. Vue wanted a terminal that could enable customers to select their own seats. J2’s ‘all in the head’ design technology allowed Vue to place its EPoS terminals on poles so that the terminal could be turned to face the customer. The use of poles also increased the sales space on the counter.
The Challenge for Grocery Retailers
Richard believes the biggest IT challenge that J2’s grocery clients face is the race into multi-channel retailing: “It’s not just about having the right point-of-sale terminal on the counter: more retailers are installing self-checkout kiosks and tills linked with weighing scales. The problem is deciding how best to use the available technology to implement a multi-channel sales strategy to remain competitive. For example, many of our bakery clients are now looking at how to incorporate mobile POS devices to cater for the very busy times to reduce long queues at the checkout. Another example is mobile counters that incorporate the point-of-sale so the shop layout can be easily changed to increase visibility for promotions etc. Capabilities like these will be incorporated into more and more retailers’ IT strategies to allow them to remain competitive and fresh. It will become increasingly common to walk into a c-store and find these units in action, instead of people at a fixed till.”
Richard is confident that J2 will continue to lead the field in this type of innovation: “Our approach is to split our sales effort into very clear verticals and address each of the markets in succession. In UK cinemas, 50% of venues currently use J2 terminals. In bakery, J2 is the number one point-of-sale supplier. J2 is now working in collaboration with IT professionals and retailers in quick-service restaurants and convenience grocery to enable them to increase efficiency and reduce costs. In convenience grocery, we confidently expect market leadership within two to three years.”
The J2 Story
J2 began in 2002, when Moray Boyd, together with three other directors, led a management buy-out from Aspeon Inc, the American touchscreen POS manufacturer. Moray Boyd explains: “My vision was for a proactive, innovative organisation that could challenge the old approach to manufacture and I think we’ve achieved that. I don’t believe in telling customers how to run their business, but I do believe that sharing knowledge, expertise and experience produces the best solutions.”
J2 is still privately owned, and through a period of steady growth and internationalisation has retained the dynamic team culture that facilitates creativity. Moray continues: “Of course, J2’s success is due to the strength of our team. Our key personnel have all been with us from the start and it’s been a very exciting journey.”
With subsidiaries in America and Australia and distributors in 15 other countries, J2 is a worldwide player, but the UK is still very important, as Richard Heitmann confirms: “The UK still accounts for over forty percent of our business, but Continental Europe in particular is growing, as is Africa. Franprix, the French supermarket chain, is our latest Continental customer.”
J2’s current turnover is around £12million, and the company employs 30 staff. The UK base is in Birchwood, Warrington, central to the rest of mainland UK, and where J2’s warehousing and technology development take place. J2 also has a number of field-based staff, handling sales around the country, particularly in London and the South.
J2 has earned a worldwide reputation for innovation, reliability and low cost of ownership. Moray expounds: “Our capability to design and develop our own product is highly significant. We manufacture to our own specification in the Far East and retain Intellectual Property throughout. It’s an important issue, because consistency and quality of build is the major factor affecting reliability and overall cost of maintenance for our customers.”
Leading the R&D team and working closely with the partners’ factories from his base in Singapore is Norman Campbell, recognised in the industry as one of the world’s top PC-based hardware designers. Moray continues: “Working with Norman, we have unrivalled experience in designing integrated point-of-sale products. We have handpicked our manufacturing partners, two in Taiwan and one in China, for their high quality production.”
Leading the market in innovation and reliability
J2 has customers across the retail sector, including hospitality, leisure, hotels, stadia and the on-trade. The range starts with low-end options, which are easy to upgrade. A major advantage for J2’s customers is that the level of reliability is so high that J2 terminals can be maintained without the need for formal maintenance contracts, making cost of ownership much lower than other competitive point-of-sale equipment.
J2 takes credit for many key innovations that have redefined the integrated touchscreen computer market. For example:
• J2 introduced the first fanless point-of-sale terminal running Windows OS.
• J2 launched the world’s most powerful touchscreen point- of-sale device – J2 650.
• J2 is the first manufacturer to offer a switchable ‘green mode’ on a standard production terminal – J2 650.
• J2 pioneered ‘all in the head’ design and is the first manufacturer to pole-mount the whole system above counter level.
• J2 is the first to offer multi-fix options for all terminals ie: wall-mount, pole-mount, stand-mount.
• J2 is the first to introduce Solid State Drives as standard.
• J2 has led the development of on-board Health Monitoring for terminals that now alert the customer before they break down.
• J2 Wave Handheld terminal is the first to offer battery life of up to 12 hours.
The J2 unique ‘all in the head’ design offers fully-integrated touchscreen point-of-sale terminals that can be stand-mounted, wall-mounted or pole-mounted, with secondary displays on screens from 8” to 15”. J2’s best-selling J2 650 terminal is “almost a series in itself”, in Moray’s words. The entry-level models can be switched into ‘green mode’ so will shut down the internal fans but still offer very powerful processing: A simple upgrade of the processor, (Core® 2 Duo) is ideal for running power-hungry software such as advertising on remote displays. The J2 650 is capable of running RAID and can also act as a server. The latest terminal is the J2 615 integrated touchscreen computer. Launched at end 2009, the J2 615 uses the latest Intel Atom processor and is also fanless, with low power consumption. J2 is the first manufacturer to offer a Solid State Drive rather than the normal hard drive to increase life and reliability.
Continuing the company’s tradition for innovation, J2’s latest launch is a new handheld device, the J2 Wave. Moray Boyd outlines the proposition: “We decided it was time to move into mobile computing, hence the Wave is a ruggedised handheld with wireless capability and 802.11G Bluetooth capability for mobile printing.” The new J2 Wave has a 4.3” screen and up to 12 hours’ battery life, unlike most handhelds, so it can go through a full trading period with one charge. A tough machine all round, it has a drop test spec of 1.2m. J2 also offers the option of a magnetic stripe reader and scanner, particularly relevant in the US. “The Wave is priced considerably below its competitors,” says Moray. “It’s not a PDA, it’s a proper portable computer for retail use.” The Wave is available in the UK through J2’s integrated sales channel – distributors, resellers, software partners and direct sales to the end user.
A rolling record of success
Since 2002, over 70,000 J2 terminals have been installed in UK stores. Among the major retail contracts, as well as the previously-mentioned special models developed for Greggs, Haldanes supermarkets have rolled out J2 equipment across their estate, and early adopters Birds, the Derby-based confectioners, and Vue cinemas are currently on their second round of installations.
In a crowded retail IT market, J2’s proposition is clear and different. Richard explains: “J2 owns and design its own products which guarantee feature-rich, reliable terminals with very low cost of ownership. J2 offers ‘all-in-the-head’ integrated design, which is neat with minimal cabling, freeing important counter space. Retailers can choose from a range of products to suit their business need and can upgrade existing systems easily and economically. Other POS manufacturers push their maintenance contracts because they are a major source of revenue. That’s something we’ve never done. Also, because we own and control the design and production, we can ensure consistent componentry over the life of the product.”
Other companies can take years to come to market with new machines. At the time of writing this interview, J2 had just completed a prototype specified only four weeks before. Moray Boyd elaborates: “We can come to market with new products within four months or, for a variant on an existing product, even sooner. We carried out a project in South Africa that required a change of technology, we had a prototype ready in under a month, and achieved sign off in six weeks with roll-out shortly after that. We only design and manufacture point-of-service devices and we do it better than anyone else.”
J2 terminals are smart. They can self-diagnose faults, and have on-board diagnostics to track resource usage and key voltages through the machine. The terminals have the ability to send email alerts if any of the set parameters go out of specification. “This is shown to dramatically reduce cost of ownership because customers only pay when something goes wrong. It’s a unique strength that J2 will continue to develop.” For the new Wave handheld, J2 offers the option to upgrade to a three-year, no-quibble, replacement warranty.
“We now find that customers considering changing or upgrading their applications frequently approach J2 for advice. Our extensive experience with a variety of software providers enables J2 to recommend appropriate software partners.” Moray elucidates: “This is new territory for J2 and shows that customers recognise our different approach to the manufacture and supply of point-of-sale hardware.”
J2 Retail Systems Limited Tel: 01925 817003 www.j2retailsystems.com