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5 Ways IoT is Changing Small and Medium-Sized Businesses

By Ian Slack - May 03, 2019

Do you like wine? What if the next time you shopped for it you could enter your taste preferences in a mobile point of sale device and digital shelves then lit up to show you bottles matching the types of wine you like? That's exactly what BASF built into its "Smart Wine Shelf."

How about the next time you're trying on clothes in a store, the mirror in the dressing room can read the RFID tags on the clothing you bring in and can ask a sales associate to bring you another size or color if you want it? Rebecca Minkoff stores do that.

Changing with the Times

As brick-and-mortar retailers compete with online sellers, they're using technology like the two above examples, which leverage the Internet of Things (IoT) to create awesome user experiences. What is IoT? Think of devices that connect and interact over the internet such as fitness trackers and "smart" doorknobs. Here are some of the ways IoT is transforming all businesses, both big and small:


Ever had this experience? You go into a store to buy a specific product. A sales associate looks it up in a computer and believes it's in stock. You then wait around for 20 minutes while the clerk rummages on shelves or in a back room until it's found – or sometimes not found. The majority of computerized inventory systems in use today are very old technology. When it comes to pinpointing exactly where items are, they leave a lot to be desired.

Right now, the broadest use-case example for IoT and small to medium-sized businesses (SMBs) lies in tracking and the related data gathered. IoT sensors can follow the specific location of items in real time all the way from production, packaging, shipment, to retail sale with inexpensive radio-frequency tags. It solves the aforementioned clerk-searching-for-inventory problem, and means hyper-accurate accounting, radically improved speeds, and super-easy automated stock replenishment, etc. Once primarily used by big businesses, the costs of such IoT solutions have now dropped to the range of affordability for smaller companies.

Moreover, it's not just goods. GPS trackers are used in service scenarios to chart fleet and employee movements to evaluate workflows, boost efficiencies, and improve customer experiences. When was the last time you had a cable guy out to your home? Chances are you knew exactly when he was going to arrive thanks to an automated notification system that sent a text alert to your phone.


IoT has just about as many monitoring uses as you can imagine. Farmers use it to watch moisture levels in their fields and remotely activate irrigation systems. Manufacturers use IoT to keep tabs on each stage of the fabrication process to ensure quality control. The healthcare industry can use IoT wearables and other connected devices to follow a patient's vital signs or chronic conditions.


Tracking and monitoring improve business productivity. After all, if you know where something is, you're not going to waste time looking for it. If a farmer can automate irrigation, then he's not spending time driving from field to field. Less money is lost to wasteful mistakes if a manufacturing process is closely monitored for defects.

Modern offices now use IoT to dramatically improve employee collaboration and productivity. For example, studies show that people who work from home are more productive. Meeting rooms outfitted with IoT solutions like smart monitors, easy-to-use communication, and occupancy schedules facilitate collaboration with remote workers and make workflows seamless.

Innovations in smart furniture mean desks that remember a user's preferences and IoT-enabled collaboration centers that can be continuously evaluated to see how effective they are based on collected data.

IoT is also used to regulate lighting and environmental systems to improve worker comfort, which increases productivity and also cuts energy costs.

In customer service, artificial intelligence devices like AlexaTM and SiriTM have the potential to improve efficiency and productivity by automating some communications with consumers.


Some of the first uses in IoT for business were in the realm of security. From cameras, sensors, and building access, IoT has revolutionized security systems and significantly reduced the number of human resources needed.


Companies are very aware of the power of data in today's business environment, and IoT brings an avalanche of it. The challenge lies in how to parse and exploit the information you gather. Many are realizing that advanced number crunching and data gathering requires improvements in digital infrastructure.

Use examples in retail include using IoT sensors to track store foot traffic to evaluate interest in displays or quickly flag sales trends that can be taken advantage of.

The bottom line is a better understanding of your customers and employees, and that drives better business decisions.

It's all about the user experience

Whether it's an office, retail, or service business, customer and employee experiences are everything to gain a competitive edge.

Take retail for example. What's the great differentiator between brick-and-mortar and online? It's "tactile shopping." For items like clothing, many customers want to touch, feel, and try on certain products. In the Rebecca Minkoff example, IoT smart mirrors take that advantage and put it on steroids.

IoT-improved user experiences make a difference in all kinds of businesses. Offices that leverage IoT solutions to improve productivity and worker satisfaction are better placed to lead in today's competitive hiring environment.

You need a plan

So, it's clear that if IoT isn't already impacting your business in a big way it soon will. Still, many companies are sitting on the sidelines when it comes to implementing IoT solutions for good reasons.

In retail, a good IoT strategy should include a mobile point of sale solution. What if they don't have your size in stock? With IoT and mobile POS, so-called "endless aisles" are now possible where a sales associate armed with a tablet can transform the old answer of "sorry," or the indeterminate "We can order it for you," to the definite "We can have that delivered to your home Wednesday." The consumer gets tactile shopping linked to an experience similar to online. The store gets additional sales.

IoT does bring security concerns. After all, anything plugged into your network that connects with the internet needs careful vetting. Some businesses simply don't have the technical expertise to handle IoT and have no idea where to start. IoT is often complex.

One thing you don't want to do is buy something because it's cool with no consideration of what substantive contribution it's going to make to your bottom line. Yes, the cost of many IoT solutions is coming down, but you still need to get value for money.

If you don't have the internal expertise, then this might be a good time to partner with a small business digital expert that can help you evaluate technologies, help you figure out where they fit in your business model, and then implement them for you, giving you the business value you expect.

It's clear that IoT will be a major competitive differentiator for businesses, but it has to be done right.




Future-pathing Your Business

The pace of new technology and innovation seems to get faster every year. According to several predictions, 2018 was a big year for small and medium businesses (SMBs) to adopt new capabilities like cloud computing.
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